I was fortunate to attend Sci Foo Camp last month, run by O'reilly and Nature, at the Googleplex in Santa Clara.  The camp was full of remarkable people; I definitely felt like a small fish.  (I have a brief contribution to the Nature Podcast from Sci Foo; text, mp3.)  There were a great many big, new ideas floating around during the weekend.  Alas, because the meeting was held under the Chatham House Rule, I cannot share all the cool conversations I had.

However, at the airport on the way to San Jose I bumped into Greg Bear, who also attended Sci Foo, and our chat reminded me of an idea I've been meaning to write about.

In an essay published last year, Synthetic Biology 1.0, I touched briefly on the economic costs of disease as a motivation for developing cheaper drugs.  Building synthetic biological systems to produce those drugs is an excellent example of the potential rewards of improved biological technologies.

But a drug is a response to disease, whereas vaccines are far and away recognized as "the most effective medical intervention" for preventing disease and reducing the cost and impacts of pathogens.  While an inexpensive drug for a disease like malaria would, of course, be a boon to affected countries, drugs do not provide lasting protection.  In contrast, immunization requires less contact with the population to suppress a disease.  Inexpensive and effective vaccines, therefore, would provide even greater human and economic benefit.

How much benefit?  It is extremely hard to measure this sort of thing, because to calculate the economic effect of a disease on any given country you have to find a similar country free of the disease to use as a control.  A report released in 2000 by Harvard and the WHO found that, "malaria slows economic growth in Africa by up to 1.3% each year."  The cumulative effect of that hit to GDP growth is mind-blowing:

...Sub-Saharan Africa's GDP would be up to 32% greater this year if malaria had been eliminated 35 years ago. This would represent up to $100 billion added to sub-Saharan Africa's current GDP of $300 billion. This extra $100 billion would be, by comparison, nearly five times greater than all development aid provided to Africa last year.

The last sentence tells us all we need to know about the value of a malaria vaccine; it could advance the state of the population and economy so far as to swamp the effects of existing foreign aid.  And it would provide a lasting improvement to be built upon by future generations of healthy children.

The economic valuation of vaccines is fraught with uncertainty, but Rappuoli, et al., suggest in Science that if, "policymakers were to include in the calculation the appropriate factors for avoiding disease altogether, the value currently attributed to vaccines would be seen to underestimate their contribution by a factor of 10 to 100."  This is, admittedly, a big uncertainty, but it all lies on the side of underestimation.  And the point is that there is some $20 Billion annually spent on aid, where a fraction of it might be better directed towards western vaccine manufacturers to produce long term solutions.

Vaccine incentives are usually discussed in terms of guaranteeing a certain purchase volume (PDF warning for a long paper here discussing the relevant economics).  But I wonder if we shouldn't re-think government sponsored prizes.  This strategy was recently used in the private sector to great effect and publicity for the X-Prize, and its success had led to considering other applications of the prize incentive structure.

Alas, this isn't generally considered the best way to incentivize vaccine manufacturers.  The Wikipedia entry for "Vaccine" makes only passing reference to prizes for vaccine development.  A 2001 paper in the Bulletin of the World Health Organization, for which a number of experts and pharmaceutical companies were interviewed about ways to improve AIDS vaccine development, concluded, "It was felt that a prize for the development of an AIDS vaccine would have little impact. Pharmaceutical firms were in business to develop and sell products, not to win prizes."

But perhaps the problem is not that prizes are the wrong way to entice Big Pharma, but rather that Big Pharma may not be the right way develop vaccines.  Perhaps we should find a way to encourage a business model that aims to produce a working, safe vaccine at a cost that maximizes profit given the prize value.

So how much would developing a vaccine cost?  According to a recent short article in Nature, funds devoted to developing a malaria vaccine amounted to a whopping measly $65 million in 2003.  The authors go on to to note that, "At current levels, however, if a candidate in phase II clinical trials demonstrated sufficient efficacy, there would be insufficient funding available to proceed to phase III trials."

It may be that The Gates Foundation, a major funder of the malaria work, would step in to provide sufficient funds, but this dependency doesn't strike me as a viable long-term strategy for developing vaccines.  (The Gates Foundation may not be around forever, but we can be certain that infectious disease will.)  Instead, governments, and perhaps large foundations like The Gates, should set aside funds to be paid as a prize.  What size prize?  Of the ~$1-1.5 Billion it supposedly costs to develop a new drug, ~$250 million goes to marketing.  Eliminating the need for marketing with a prize value of $1.5 Billion would provide a reasonable one time windfall, with continued sales providing more profit down the road.

Setting aside as much as $200 million a year would be a small fraction of the U.S. foreign aid budget and would rapidly accumulate into a large cash payout.  Alternatively, we could set it up as a yearly payment to the winning organization.  Spread the $200 million over multiple governments (Europe, Japan, perhaps China), and suddenly it doesn't look so expensive.  In any event, we're talking about a big payoff in both saving lives and improving general quality of life, so a sizable prize is warranted.  I expect $2 Billion is probably the minimum to get international collaborations to seriously compete for the prize.

The foreign policy aspects of this strategy fit perfectly with the goals of the U.S. Department of State to improve national security by reducing poverty abroad.  Here is Gen. Colin Powell, reprinted from Foreign Policy Magazine in 2005 ("No Country Left Behind"):

We see development, democracy, and security as inextricably linked. We recognize that poverty alleviation cannot succeed without sustained economic growth, which requires that policymakers take seriously the challenge of good governance. At the same time, new and often fragile democracies cannot be reliably sustained, and democratic values cannot be spread further, unless we work hard and wisely at economic development. And no nation, no matter how powerful, can assure the safety of its people as long as economic desperation and injustice can mingle with tyranny and fanaticism.

Development is not a "soft" policy issue, but a core national security issue. [emphasis added]  Although we see a link between terrorism and poverty, we do not believe that poverty directly causes terrorism. Few terrorists are poor. The leaders of the September 11 group were all well-educated men, far from the bottom rungs of their societies. Poverty breeds frustration and resentment, which ideological entrepreneurs can turn into support for--or acquiescence to--terrorism, particularly in those countries in which poverty is coupled with a lack of political rights and basic freedoms.

Dr. Condoleezza Rice, in opening remarks to the Senate Foreign Relations Committee (PDF warning) during her confirmation hearings, plainly stated, "...We will strengthen the community of democracies to fight the threats to our common security and alleviate the hopelessness that feeds terror."

Over any time period you might care to examine, it will probably cost vastly less to produce a working malaria vaccine than to continue dribbling out foreign aid.  Even just promoting the prize would bolster the U.S. image abroad in exactly those countries where we are hurting the most, and successful development would have profound consequences for national security through the elimination of human suffering.  Seems like a good bargain.  The longer we wait, the worse it gets.