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

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

Zoonotic diseases account for half of
livestock losses due to diseases
Non-zoonoses
50% 50% Zoonoses
Total loss: Source: SAFOSO
762‘212 LSUs
3

IMPACT ON HUMANS - SELECT ZOONOTIC DISEASES
DISEASE PERIOD Reported Reported
cases fatalities
SARS 2002-3 7,918 761
HPAI 2004-present 584 345
West Nile 1999-2008 28,975 1,124
Rift Valley 2006-7 1,062 315
Fever
HIV/AIDS 2009 2.6 m/year 1.8 m/year
(25m since 1981)
Flu Pandemic of 1918/19: 50 million to 100 million died

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

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

Costs of selected zoonotic disease outbreaks
SARS (Asia, Canada, rest
50 of the world), 2002
45
40
35
30
US $ billion
HPAI (Asia), 2004
25
BSE (UK), 1986
20
15 BSE (USA), 2004
10
Plague (India), Nipah virus
5 1994 (Malaysia),
1998 HPAI (Europe), 2005 RVF
WNV, 1999 (Kenya, Somalia, Tanzani
0 a), 2006
1980 1985 1990 1995 2000 2005 2010
7

“Indirect” economic costs: Tourist arrivals
in China and Thailand
8

Adding it up: costs of zoonotic diseases
(select outbreaks, US$ billion)
Costs (conservative Annual
Period estimates) average
6 outbreaks other than SARS
-Nipah virus (Malaysia),
-West Nile fever (USA),
-HPAI (Asia, Europe), 1998-2009 38.7
-BSE (US),
-Rift Valley Fever (Tanzania, Kenya, Somalia)
- BSE (UK) costs in 1997-09 only
SARS 2002-2004 41.5
Total in 12 year 80.2
period (1998-2009) 6.7
9

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

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

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

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

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

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 (the price of greater health security
and protection of incomes)
15

Annual costs of prevention vs
Annual expected benefits of
40 prevention of pandemic and non-
35 pandemic outbreaks 6.7b
30
25
$ billion per year
20 6.7 b
15
10
5
0
Costs of prevention Benefits from averted Benefits from averted
(investments in animal mild pandemic severe pandemic
and human health
systems)
16

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

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

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

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

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

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 $3.8 billion (no pandemics) and
$33.8 billion (1 pandemic/100 years)
22

Thank you.
www.worldbank.org/flu
23