1. Economics of One Health Presentation to the One Health Summit 2012 Davos, February 19-23, 2012 Olga Jonas, Economic Adviser, World Bank Report by Jimmy Smith, Cornelis de Haan and Sarah Stephenson

2. OUTLINE Impact on livestock, people, economies How can One Health approaches help reduce these costs? –Effectiveness gains –Efficiency gains (within increased investments and recurrent expenditures, esp. in developing countries) Return on investment in One Health systems 2

3. 3 Zoonotic diseases account for half of livestock losses due to diseases Total loss: 762‘212 LSUs Source: SAFOSO

4. IMPACT ON HUMANS - SELECT ZOONOTIC DISEASES Flu Pandemic of 1918/19: 50 million to 100 million died DISEASEPERIOD Reported cases Reported fatalities SARS 2002-3 7,918761 HPAI 2004-present584345 West Nile 1999-200828,9751,124Rift Valley Fever 2006-71,062315 HIV/AIDS20092.6 m/year1.8 m/year ( 25m since 1981 )

5. What is the burden (total cost) of diseases and what are its components? Only partial information, but better data are increasingly needed (and will become even more necessary) To assess total cost, useful to look at components of costs of outbreaks in animals and in humans Costs of selected major outbreaks in 1986-2009 5

6. Components of economic costs due to zoonotic disease outbreaks 6 Deaths from disease & control measures Medical costs Illness and absenteeism Avoidance behaviors Spill-over effects in other sectors (tourism, transport, retail, etc) 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Direct impact Indirect impact Control measures Outbreak in animals Outbreak in humans Lower Productivity Ripple effects: -- Reduced demand -- Complementary products Consequential on-farm losses- Mortality

7. 7 Costs of selected zoonotic disease outbreaks

8. 8 Example of “indirect” economic costs: Tourist arrivals in China and Thailand

9. Adding it up: costs of zoonotic diseases (select outbreaks, US$ billion) Period Costs (conservative estimates) Annual average 6 outbreaks other than SARS -Nipah virus (Malaysia), -West Nile fever (USA), -HPAI (Asia, Europe), -BSE (US), -Rift Valley Fever (Tanzania, Kenya, Somalia) - BSE (UK) costs in 1997-09 only 1998-200938.7 SARS2002-200441.5 Total in 12 year period (1998-2009) 80.2 6.7 9

10. Poor households hardest hit – household income effect of backyard poultry sales ban

11. Significant negative impacts …. but only partially monitored and documented What could One Health approaches contribute to reduce negative impacts? 11

12. One Health approach – an integrated response to “what needs to be done?” - - as opposed to the classical approach based on “what can I do?” 12

13. One Health approaches can increase: EFFECTIVENESS –doing the right thing, getting the desired results: prevention, accurate and timely diagnostics, effective control measures EFFICIENCY –doing the thing right, achieving results at least cost 13

14. Delays increase costs Adapted from IOM (2009) Exposure in animals Clinical signs in animals Exposure in humans Clinical signs in humans Humans seek medical care Cost of control outbreak 14

15. Funding requirements for “One Health” efficient prevention and control system Total for 139 low- and middle-income countries –$ 1.9 b – 3.4 b per year »Note: actual losses in 1998-2008 were >US$ 6.7b/year (i.e., double) –About 7x more than current effort, which is waning due to “flu fatigue” –Equivalent to $1.90 - $3.40 per person per year in OECD countries (low price to pay for greater health security and protection of incomes) 15

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17. 17 Case 1 : Mild Influenza Pandemic* Annual Expected Rate of Return on Investments in Prevention low preventive effort high preventive effort Reduction in expected disease outbreak impact 20%31%14% 50%65%44% 100%97%71% * Impact $600 b (1% of GDP), probability 2.5%, expected benefit of prevention $15 b/year

18. 18 Case 2: Severe Influenza Pandemic Annual Expected Rate of Return on Investments in Prevention low preventive effort high preventive effort Reduction in expected disease outbreak impact 20%49%25% 50%88%57% 100%123%86% * Impact $3 trillion (4.8% of GDP), probability 1%, expected benefit of prevention $30 b/year

19. 17 9 4 8 0 4 8 12 16 20 24 28 32 36 0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 Beijing (Jan '06) Bamako (Dec '06) Delhi (Dec '07) Sharm El- Sheikh (Oct '08) After SES, 2009 Number of donors pledging $ million Financing gapPledges Number of donors pledging Loans Grants 35 Avian & Pandemic Influenzas - Donor Interest Has Vanished 19

20. Characteristics of financing for One Health systems Constant over time, medium- to long-term, and reliably assured (not emergency response financing) Reach countries with greatest gaps in veterinary and human health systems Should be on grant basis (global public good) … and also include contribution from sector/livestock product consumers Encourage prompt and complete reporting of outbreaks at national, regional and international levels 20

21. Some options for mobilizing resources for One Health systems Official Development Assistance -- insufficient and unreliable, prevention typically not a priority. World Bank, AsDB, AfDB etc – time-bound loans (good in emergencies, as last resort). Could “blend” with grants for leverage. Dedicated funding from donors (with fair burdensharing) plus a levy on livestock products and/or contributions from consumers wishing to lower their pandemic risk. Governance of fund could include livestock producer associations, official and scientific representatives, civil society. Private sector – international and domestic 21

22. Value Added of One Health Approaches 1.support poverty alleviation and economic growth in developing countries 2.reduce pandemic risk globally 3.improve public health globally 4.help build effective animal and human health systems without weak links; “effective” means early detection and rapid response; delays result in less effective disease control and higher risks at the animal-human- environment interface 5.help build efficient animal and human health systems; “efficient” because of shared capacities and information, reduction of duplication, economies of scope, economies of scale 6.net expected annual benefit between $4 billion (no pandemic threat) and $35 billion (1 severe pandemic/100 years); with higher probability of pandemics, benefits even greater. 22

23. Thank you. www.worldbank.org/flu 23