GAVI's Chief Executive Officer says decision to place donor contributions for the Advance Market Commitment (AMC) on the World Bank's balance sheet brings implementation of pilot AMC project closer
Geneva, 6 April 2009 - GAVI Alliance Chief Executive Officer Dr. Julian Lob-Levyt has welcomed the April 3rd decision by the World Bank to provide a financial platform for the Alliance's Advance Market Commitment (AMC).
The decision takes us one step closer to a pilot AMC, which will get life-saving pneumococcal vaccines to the children who need them most. We look forward to implementing this pilot over the coming months.
Julian Lob-Levyt, GAVI CEO
The AMC initiative aims to stimulate the development and manufacture of affordable vaccines tailored to the needs of developing countries. The Governments of Italy, the United Kingdom, Canada, Norway, and Russia, as well as the Bill & Melinda Gates Foundation, have committed US$1.5 billion to a pilot AMC against pneumococcal disease.
A major cause of pneumonia and meningitis, pneumococcal kills approximately 1.6 million people every year.
"The World Bank's financial backing is a major contribution to the AMC effort," said Dr. Lob-Levyt. "The decision by the Board of Executive Directors takes us one step closer to a pilot AMC, which will get life-saving pneumococcal vaccines to the children who need them most. We look forward to implementing this pilot over the coming months."
The decision means donor contributions for the pilot AMC will be placed on the balance sheet of the Bank's International Bank for Reconstruction and Development (IBRD). The IBRD will provide standard financial management and administrative services regarding donor contributions, AMC commitments, and disbursements.
Through the AMC mechanism, donors commit money to guarantee the price of vaccines once they have been developed, thus creating the potential for a viable future market. These commitments provide vaccine makers with the incentive to invest the considerable sums required to conduct research and build manufacturing capacity.
Companies that participate in an AMC make legally binding commitments to supply the vaccines at lower and sustainable prices after donor funds made available for the initial fixed price are spent. The donor funds are not provided until the proposed vaccines have met stringent, pre-agreed technical criteria and developing countries request them.
"The AMC pilot represents the first step in an historic effort to create a market for life-saving vaccines for children in the world's poorest countries," said Dr. Lob-Levyt. "Without the innovative thinking by donors and the flexibility of the World Bank to place the funding on its balance sheet, we would not be able to launch this innovative and new way to save lives."
Ultimately through the AMC, developing country governments will be able to budget and plan for their immunisation programmes knowing that vaccines will be available in sufficient quantity at a price they can afford for the long term.