On Friday, June 25^th, the Center for Strategic and International Studies (CSIS), assisted by a team from R4D, hosted a panel of top U.S. experts on development assistance and innovative financing for health.  Nearly 100 persons attended the event and another 100 followed the proceedings via webcast.  Panelists included Deputy Assistant Administrator Amie Batson of USAID; John Hurley, Director of International Development Policy at the U.S. Treasury; Susan McAdams, Director of Multilateral and Innovative Finance at the World Bank; and R4D Managing Director Robert Hecht. Lisa Carty from CSIS moderated the session.

Robert Hecht kicked off the session with an overview of innovative financing mechanisms and posed a series of questions for the panelists (slides are available below).

With the launch of President Obama’s Global Health Initiative (GHI) and a renewed interest in innovative financing within the Administration, the panelists stressed that such innovative mechanisms can be useful tools for helping to meet the Millennium Development Goals and the objectives of the GHI. 

Amie Batson noted “A dollar is not a dollar” -- if innovative tools can link funding to results, improve the predictability and sustainability of financing and solve key challenges in global health programs, then a dollar can go much further.

Over the past six years, political and administrative challenges (including some connected with the U.S. government’s budget systems and the way in which multi-year commitments are “scored”) have left the U.S. mostly  on the sidelines of innovative financing, as European countries have charged forward with initiatives such as the International Financing Facility, the Advance Market Commitment, and UNITAID. 

Will the Obama Administration engage more fully in innovative financing discussions and find ways to join international efforts? 

The response from the panel was largely positive.  Under Administrator Raj Shah’s, Amie Batson explained, USAID has a stronger interest in innovative financing.  A full time USAID advisor is being hired to focus on the topic.  The Office of Science and Technology Policy in the White House is also eager to support experimentation with prizes and other incentives for health R&D.

Panelists agreed that the quest for innovative financing should start not with the innovative tools but with the problem to be solved with them, such as insufficient funding for health services or for R&D; lack of incentives for new products for neglected diseases; low manufacturing capacity for new drugs and vaccines; and weak linkages between funding and efficient health  performance by governments and health facilities.  Susan McAdams stressed the importance of new financing mechanisms being able to solve these problems and to do so without requiring a lot of additional start up and operating costs.

Amie Batson and John Hurley pointed out that some innovative mechanisms might not add strategic value from the U.S. perspective or be the least expensive alternative.  For example, although the International Finance Facility for Immunization (IFFIm) has obtained low interest rates on the international bond market, the U.S. Treasury can borrow at least as cheaply and with fewer transaction costs by issuing its own sovereign bonds.

The panelists did agree on one thing: there is tremendous potential for different US government agencies to learn about innovative financing from one another and other organizations.  It would therefore be worthwhile to bring these groups together regularly and sustain dialogue with them as the U.S. considers new ways to participate in and leverage innovative financing to advance its goals in global health.

Watch the recording of the event.

This event was grounded inR4D’s technical paper “Innovative Financing for Global Health A Moment for Expanded U.S. Engagement?” prepared for the CSIS Commission on Smart Power for Global Health. 

Attached File(s): 

R4D CSIS Presentation 25 June 2010.pdf