ASEAN Regional Vaccine Manufacturing and Development Regional Synthesis Report Report No: AUS0003264 April 18 | 2023 Authors: Ronald Mutasa, Ramana Gandham, Giles Newmarch, Andreas Seiter, Marco Schaeferhoff, Erin Sowers, Michael Schunk, Ridhi Gupta, Lucky Slamet, Stephane Guichard, and Pandu Harimurti © 2023 The World Bank 1818 H Street NW, Washington DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved This work is a product of the staff of The World Bank. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Rights and Permissions The material in this work is subject to copyright. Because The World Bank encourages dissemination of its knowledge, this work may be reproduced, in whole or in part, for noncommercial purposes as long as full attribution to this work is given. Attribution—Please cite the work as follows: “World Bank. 2023. ASEAN Regional Vaccine Manufacturing and Development: Regional Synthesis Report. © World Bank.” All queries on rights and licenses, including subsidiary rights, should be addressed to World Bank Publications, The World Bank Group, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2625; e-mail: pubrights@worldbank.org. 2 TABLE OF CONTENTS ACKNOWLEDGEMENTS ..............................................................................................................................................4 ACRONYMS .................................................................................................................................................................5 EXECUTIVE SUMMARY................................................................................................................................................6 ....................................................................................................................................................................................6 Chapter 1: Introduction ..............................................................................................................................................8 Chapter 2: Vaccine Security Coordination............................................................................................................... 16 Chapter 3: ASEAN Vaccine Value Chain................................................................................................................... 22 Chapter 4: Developing a Regional Eco-system ........................................................................................................ 31 Chapter 5: Economic Benefits of Investing in ASEAN Vaccine Development, Manufacture, and Regulatory Strengthening .......................................................................................................................................................... 35 Chapter 6: Way Forward ......................................................................................................................................... 47 APPENDICES............................................................................................................................................................. 51 Appendix 1: Focus Country SWOT Analyses of Domestic Vaccine System ......................................................... 51 Appendix 2: Model Specification and Equations with Data Sources................................................................... 54 Appendix 3: Incremental Manufacturing Scenario ............................................................................................. 61 Appendix 4: Productivity Gains ........................................................................................................................... 62 Appendix 5: 5.0% Discount Rate ......................................................................................................................... 63 Appendix 6: Lower Phase III Clinical Trial Costs .................................................................................................. 64 Appendix 7: Two-year Duration Between Vaccine Launch and Market Entry .................................................... 65 Appendix 8: Disease Incidence, Deaths, and DALYs in ASEAN Countries............................................................ 66 Appendix 9: Detailed Overview of Economic Benefits ........................................................................................ 69 Appendix 10: Breakdown of Clinical Trial, Manufacturing, and Regulation Costs by Scenario .......................... 70 Appendix 11: Domestic General Government Health Expenditure (GGHE-D) of ASEAN Countries ................... 75 3 ACKNOWLEDGEMENTS This ASEAN Vaccine Development and Manufacturing Research Project was executed by a joint team from the World Bank and the International Finance Corporation. The study was a collaborative effort between the World Bank Group and the Government of Indonesia, the Government of Malaysia, the Government of the Philippines, the Government of the Kingdom of Thailand, and the Govenrment of Vietnam represented by health sector and economic sector agencies, and the ASEAN Secretariat. While the study supported a deep-dive analysis of the five countries with advanced vaccine manufacture potential, it is intended to benefit the entire region. The study benefited from the partnership and co-financing of the UK Foreign Commonwealth Development Office, the Global Financing Facility, and the Indonesia Multi-donor Trust Fund for Health. The partnership of the World Health Organization Regulation and Prequalification Department and the Coalition for Epidemic Preparedness Innovations (CEPI) is deeply appreciated. The study built on the World Bank’s support to ASEAN countries’ responses to the COVID-19 pandemic. The technical contributions of Achim Schmillen (Practice Leader, Indonesia), Christophe Lemiere (Practice Leader and Study Lead for Vietnam), Anh Thuy Nguyen (Senior Operations Officer), Zinaida Korableva (Operations Analyst), Smita Kuriakoe (Senior Economist), Melissa Guerrero (Health Specialist), Mei Ling Tan (Senior Country Officer, Malaysia), Kwanpand Sudhi-Dhamak, (Country Strategy Officer, Thailand), and Julia Long (Knowledge Management Consultant) are duly acknowledged. The team also gratefully acknowledges the technical leadership and authorship of the country case studies by Professor Azizi Ayob (Malaysia), Professor Le Thi Phuong Mai (Vietnam), Dr. Rose Capeding (Philippines), and Stephane Guichard (Thailand). The team additionally appreciates the administrative and management support of Nia Damayanti Wirya (Senior Program Assitant, Indonesia), Inge Sutardi Tan (Program Assistant, Indonesia), Rosalinda Birdinia Rudangta (Team Assistant, Indonesia), Alexandre Bazerji (Operations Analyst, Indonesia), Ruzita Binti Ahmad (Program Assistant, Malaysia), Marl Jinno Gooc (Team Assistant, Philippines), Pimon Iamsripong (Program Assistant, Thailand) and Nga Thi Anh Hoang (Program Assistant, Vietnam). The regional level administrative support and cooridnation of Mae Myat Moe (Program Assistant, Myanmar) is gratefully acknowledged. The team acknowledges the guidance of Aparnaa Somanathan (Practice Manager) and Zeynep Kantur (Global Manger, Health, IFC), as well as the senior management guidance and support provided by Daniel Dulitzky (Regional Director for Human Development, EAP), Ndiame Diop (Country Director), Farid Fezuoa (Global Director, Health and Education, IFC), and Juan Pablo Uribe (Global Director for Health, Nutrition and Population). The high level guidancence and inputs from Country Directors Ndiame Diop (Malaysia, Philippines and Thailand), Satu Kahkonen (Indonesia) and Carolyn Turk (Vietnam) was critical for the regional dialogue and analytical work to advance. The team could not have completed this analysis without the leadership and ownership demonstrated by the Thailand National Vaccine Institute (regional focal agency for vaccine security), Dr. Radzi (Deputy Director General, MOH Malaysia), Professor Mohd Ghows (Director, Malaysia Vaccine Project), Dr. Lucia Rizka Andalucia (Director General, MOH Indonesia), Roy Himawan (MOH, Indonesia), Dr. Oscar Guiterez (Deputy Director General, Philippines, FDA), and Undersecretary Kenneth Ronquillo (Department of Health, Philippines). The regional leadership and support of the ASEAN Secerariat is gratefully acknowledged, with special mention to Dr. Fernando Ferdinal and Ms. Jennifer dela Rosa. The team gratefully acknowledges external partners who provided data and made time for interviews, including: the the World Health Organization; CEPI; the World Economic Forum; and private sector companies. The study benefited immensely from technical peer review comments by Dr. Lombe Kasonde (Senior Health Specialist, Africa Region, World Bank); Dr. Matthew Downham (Director, Manufacturing & Supply Chain Networks, CEPI); Dr. Kayla Laserson (Deputy Director, Infectious Diseases Cluster, India Country Office, Bill and Melinda Gates Foundation); and Ms. Zeynep Kantur (Global Manager, Health, IFC). 4 ACRONYMS ACCSQ-PPWG ASEAN Consultative Committee for Standard and Quality - Pharmaceutical Product Working Group AFTA ASEAN Free Trade Area ASEAN The Association of Southeast Asian Nations AVSSR ASEAN Vaccine Security and Self-Reliance BCG Bacille Calmette-Guerin BCR Benefit-Cost Ratio CEPI Coalition for Epidemic Preparedness Innovations COMESA Common Market for Eastern and Southern Africa CRO Contact Research Organization DALY Disability Adjusted Life Year DCVMN Developing Countries Vaccine Manufacturers’ Network DTP Diphtheria-Tetanus-Pertussis EPI Expanded Program of Immunization EUA Emergency Use Authorization EUL Emergency Use Listing FDA Food and Drug Administration GMP Good Manufacturing Practice GPO Group Purchasing Organization Hep Hepatitis Hib Haemophilus Influenzae Type B HIC High-Income Country IDP Institutional Development Plan IFC International Finance Corporation IHME Institute for Health Metrics and Evaluation IVI International Vaccine Institute JACG Joint Assessment Coordinating Group JE Japanese Encephalitis LMIC Low- and Middle-Income Country MMR Measles, Mumps, and Rubella NIP National Immunization Program NITAG National Immunization Technical Advisory Group NRA National Regulatory Authority NVDR National Vaccine Development Roadmap NVI National Vaccine Institute OPV Oral Polio Vaccine PAHO Pan American Health Organization PCV Pneumococcal Conjugate Vaccine R&D Research and Development SADC Southern Africa Development Community TB Tuberculosis UNICEF United Nations International Children’s Emergency Fund WHO World Health Organization WLA WHO-Listed Authority YLD Years Lived with Disability YLL Years of Life Lost 5 EXECUTIVE SUMMARY Over the years, Association of Southeast Asian Nations ASEAN region with new options to strengthen public (ASEAN) member countries have built considerable health preparedness and economic resilience. vaccine development assets, ranging from research and development (R&D), to manufacturing, to fill and finish The five countries engaged in the deep-dive situation and delivery protocols. The ASEAN Vaccine Security Self- analysis offer a full-spectrum of expertise and know-how, Reliance (AVSSR) initiative, launched prior to the COVID- from vaccine development including clinical trials, to 19 pandemic, convened ASEAN countries to develop manufacturing and large-scale production, with some vaccine security strategies to reduce barriers to access for established strategic partnerships for technology equitable, affordable, and quality-assured vaccines. transfer. Each country brings unique strengths to the However, the sudden need to procure and deliver high regional vaccine value chain. volume, quality vaccines to contain the COVID-19 pandemic revealed even greater systemic vulnerabilities There are costs to building regional eco-systems. and dependencies. The region lacked self-reliant vaccine Countries need to achieve or maintain NRAs at maturity production for pre-existing endemic diseases and level 3, which requires ongoing government investment outbreaks. and capacity building. Efforts are also required to identify and optimize regional sources for R&D and the key The regional vaccine research study, undertaken by the ingredients necessary for vaccine manufacture as ASEAN World Bank Group, in partnership with the UK foreign countries still rely on imports for such inputs. In addition, Commonwealth Development Office, and the Global prices of regionally produced vaccines could initially be Financing Facility for Women, Children and Adolescents, higher compared to those produced by established builds on the 2018 ASEAN vaccine baseline survey and global competitors. However, this added cost would be considers lessons learned from the COVID-19 response. worthwhile for ensuring regional vaccine security and The study seeks to identify viable options to enhance self-reliance in the medium- to long-term. The economic ASEAN regional vaccine manufacturing capacity including analysis undertaken in this project has shown that comprehensive and sustainable regional vaccine eco- regional investments in vaccine R&D, manufacture, and system development, and opportunities for foreign direct NRA capacity building would cost less than 1 percent of investment and private capital mobilization. The annual government expenditure on health while offering overarching goal of this work is to inform the AVSSR four-fold higher cost benefit ratios compared to initiative to build a strong, collaborative, regional vaccine investments and benefits limited to national level. eco-system that is supported by and benefits all ASEAN member states as a regional public good. Strong, consistent dialogue between economic and health clusters of governments and manufacturers is The study adds value to available knowledge by: (i) necessary to align vaccine security priorities with R&D bringing together new global developments in vaccine and human resource development, as well as to create self-sufficiency and equity applying the COVID-19 lens; (ii) or upgrade infrastructure to enable regional synthesizing country strengths and weaknesses through manufacture through new vaccine platforms with deep-dives covering wide-ranging stakeholders in five harmonized regional regulatory processes. The creation ASEAN countries; (iii) undertaking a value chain analysis of regional spokes in Indonesia and Vietnam under the including both forward and backward integration of WHO mRNA vaccine technology transfer hub is a step in vaccine development and manufacture in the ASEAN the right direction. The region could also benefit from region; and (iv) commissioning a detailed economic mentoring support by Singapore’s regulator which analysis to compare potential costs and benefits of recently achieved maturity level 4. Additional training regional and country level investments in vaccine and capacity-building efforts delivered at the regional development and manufacture. The study generates level could help meet priority needs with greater knowledge with positive spill-over benefits that cut across efficiency. Finally, the region needs a bold strategy for countries, presenting policy makers throughout the engaging the private sector as a partner in promoting vaccine self-sufficiency. This could create a mutually 6 enabling environment, especially with focus on emerging This report is organized into six chapters. The first and endemic neglected tropical diseases. The ASEAN chapter provides an introduction and presents a brief Secretariat could act as an important catalyst and situation analysis of current research and development coordinator to advance implementation of regional level and manufacturing capacities in the region based on actions towards vaccine manufacture. detailed desk review. The second chapter describes the importance of coordination in ensuring regional vaccine Beyond these infrastructure-building strategies, ASEAN security and presents different complementary pathways member countries could consider several low-hanging for achieving the AVSSR vision. The third chapter fruits. For example, pooled vaccine procurement at the comprehensively describes the vaccine value chain in the regional level improves access and reduces costs in the ASEAN region, covering both backward and forward long-term compared to national purchasing policies. In integration aspects, including logistics and delivery. The addition, regional efforts to harmonize NIP schedules, fourth chapter describes strategic priorities relevant to standardized halal certification and packaging regional vaccine eco-system development, and describes requirements, and regional human resource capacity existing strengths and weaknesses within selected building would ease the burden and additional costs for ASEAN countries that could influence such development. manufacturers. Finally, governments creating a favorable The fifth chapter summarizes findings of an economic environment will help to spur private investment in analysis of investing in late-stage clinical trials, vaccine manufacturing. Such initiatives can be manufacture, and regulatory strengthening for a limited complemented with long-term regional market set of priority diseases. A strong economic case is made guarantees to render these investments more attractive, for investing at the regional level compared to the especially considering ASEAN is the third most populous national level by using cost benefit ratios. The concluding region in the world. chapter summarizes feedback from key stakeholders in both public and private sectors, and utilizes this feedback to present a way forward by listing specific tasks for ASEAN member state governments, the Secretariat, and the World Bank Group. 7 Chapter 1: Introduction 1. In the Association of Southeast Asian Nations (ASEAN) region, the COVID-19 pandemic has devastated lives and economies, and threatened the development gains of the last three decades. Immunization is recognized as one of the most cost-effective public health measures to prevent and control severe infectious diseases. However, despite ongoing efforts to advance vaccine development for priority diseases by governments in the ASEAN region, the COVID-19 pandemic exposed gaps and vulnerabilities in the ASEAN countries’ vaccine security, a key component of pandemic preparedness and economic resilience. 2. The ten member countries of the ASEAN region, Figure 1.1. Cumulative COVID-19 cases with a population of over 650 million, reported per million population 35.61 million cases and 365,611 deaths due to COVID-19 as of March 5, 2023. Vietnam, Indonesia, Malaysia, Thailand, and the Philippines reported the highest number of COVID-19 cases in absolute numbers, while Brunei, Singapore, Malaysia, and Vietnam reported the highest number of cases per million population (Figure 1.1). The impact on the ASEAN economies was significant; International Monetary Foundation estimated a 3.3 percent decline in GDP for the ASEAN region in 2020.i 3. Despite progress made in the past decade, ASEAN member states have made limited investments in the research and development of vaccines and biologicals and are still dependent on imports. While there is an established framework for ASEAN coordination on vaccines and regulatory harmonization, deficits were discovered during the COVID-19 pandemic experience. Further, the ASEAN member states realized a need for increased attention to vaccine development with regard to locally endemic neglected tropical diseases such as dengue, Japanese encephalitis, and leishmaniasis, which disproportionately impact the poor. With an increasing role of antibody therapies for cancers and other chronic diseases, including bi-phasic antibodies and antibody conjugates, it is time for the ASEAN region to address the rapidly increasing burden of non- communicable diseases in the sub-region by augmenting investments in development and manufacture of biologicals and biosimilars in partnership with the private sector. All these factors make ASEAN vaccine research and development relevant and timely, and the stage is set with great potential for success. Impact of COVID-19 on the ASEAN Region 4. Rapid international efforts have led to the accelerated development and delivery of safe and effective COVID- 19 vaccines within a one year period, and they are estimated to have saved nearly 15 million lives.ii Still, over 6.85 million confirmed deaths were recorded as of January 2023, with more than 18 million estimated excess i World Economic Update: Gloomy and Uncertain July 2022 ii O.J. Watson, G. Barnsley, J. Toor, A.B. Hogan, P. Winskill and A.C. Ghani. Global impact of the first year of COVID-19 vaccination: a mathematical modelling study; The Lancet PP 1293-1302, 2022 8 deaths.iii While COVID-19 is estimated to have caused US$14-28 trillion in economic damage globally,iv Figure 1.2. COVID-19 vaccine doses Figure 1.3. Share of people vaccinated against administered for 100 people by income COVID-19 out of total population group inequitable vaccine access contributed to avoidable deaths and suffering, potentially prolonging the pandemic. As shown in Figure 1.2, high-income countries had 20-fold higher vaccine coverage compared to low-income countries. Despite achieving high levels of coverage for initial COVID-19 vaccination protocol, nearly a third of the ASEAN population was unable to achieve this (Figure 1.3). 5. The lack of equitable access to vaccines during a global health crisis underscores the need for strategic autonomy and self-reliance. Existing global and country systems failed to ensure sufficient, equitable access to vaccines during the pandemic and thus require regionally-based vaccine manufacturing eco-systems.v Vaccine preparedness will help minimize the risk of the vaccine nationalism prominently displayed during the COVID-19 pandemic. Why an ASEAN Regional Vaccine Research Study? 6. Despite rapid global development of COVID-19 vaccines and therapeutics, access in the ASEAN region remained constrained, with manufacturing of high-value vaccines (especially mRNA) concentrated in the West, and China and India producing traditional vaccines (i.e., inactivated, protein-sub-unit, and viral vector). Several vaccine-producing countries imposed restrictions during the pandemic. As a result, vaccine-producing countries and those with more resources were able to vaccinate their own populations sooner, while ASEAN countries had to wait to access reliable vaccines. Vast, ongoing delays in global distribution of COVID-19 vaccines resulted in deaths on a massive scale and allowed the evolution of the Omicron variant. Such vaccine inequities furthered disparities between high-income and low- and middle-income countries (LMIC), who remained dependent on vaccine imports for National Immunization Programs (NIP). The circumstances surrounding the COVID-19 pandemic demonstrated that every region of the world must become more self- reliant in vaccine production, with increased collaboration between the public and private sectors towards vaccine research and development (R&D) and manufacture. iii Source: Our World in Data iv Coalition for Epidemic Preparedness Innovations; https://endpandemics.cepi.net v Regionalized Vaccine Manufacturing Collaborative Framework Overview; The World Economic Forum, January 2023 9 Until you can vaccinate the whole world in six months instead of six years, we are going to continue with challenges like we are having right now with the variants. — Barney Graham, Vaccine Research Center, US National Institutes of Health 7. The ASEAN Vaccine Security and Self-Reliance (AVSSR) initiative launched just before COVID-19, and was endorsed by the region’s leaders during the 34th ASEAN Summit in November 2019. At the Summit, ASEAN heads of state and governments issued the ASEAN Leaders’ Declaration on AVSSR to highlight the benefits of collectively attaining AVSSR: (i) to avoid vaccine shortage; (ii) to improve the supply of affordable, quality vaccines for normal and emergency situations both at the national and regional levels; and (iii) to reduce vaccine-preventable disease burden and healthcare expenditure.vi The AVSSR initiative recognizes the overwhelming benefits and cost effectiveness of immunization, and reaffirms the ASEAN commitment to strengthen self-reliant health systems and improve access to healthcare and vaccine security. 8. New opportunities for capacity building created by the World Health Organization (WHO), the Coalition for Epidemic Preparedness Innovation (CEPI), and International Vaccine Institute (IVI) open possibilities the ASEAN region to circumvent a human resources bottleneck for moving towards new vaccine platforms. Simultaneously, the private sector is well-positioned financially and keenly interested in making investments in vaccine development and manufacture in the region. In May of 2021, following a forum on economic and health security setbacks from COVID-19, ASEAN Health Ministers made the most of these opportunities by identifying the need for stronger regional vaccine manufacturing capacity and human resource development. They adopted the AVSSR Strategic and Action Plan 2021-2025 with a vision to “ensure healthy ASEAN through timely, equitable access to affordable and quality-assured vaccines.”vii Study Motivation and Methodology 9. The strong regional leadership commitment behind the vision and action plan of AVSSR 2021-25 needed acceleration. Capitalizing on the lessons and window of new opportunities offered by COVID-19, and using it as an entry point, The World Bank Group undertook a situation analysis of ASEAN member countries’ efforts to achieve vaccine security using a combination of analytic methods and tools. The study scope did not cover the entire gamut of vaccine security. Rather, it focused on research, development, and related ecosystems required for manufacturing vaccines as a regional public good, and documented opportunities and challenges for mobilizing private capital. Building on the 2018 ASEAN baseline study and support implementation of the AVSSR Regional Strategic and Action Plan 2021-2025, this study aimed to identify: (i) viable options to achieve ASEAN regional vaccine manufacturing in the post COVID-19 situation as a regional public good contributing to vaccine security; and (ii) opportunities for foreign direct investment and partnerships. vi ASEAN Leaders’ Declaration on ASEAN Vaccine Security and Self-Reliance (AVSSR). 2019; published online Nov 2 https://asean.org/asean-leaders-declaration-on-asean-vaccine-security-and-self-reliance-avssr/. vii ASEAN Vaccine Network Consultation Meeting https://www.aseanvaccinenetwork.com/about 10 Scope of ASEAN Vaccine Research Study 10. The World Bank spearheaded the ASEAN Vaccine Research Study under the leadership and support of Governments of Indonesia, Malaysia, Philippines, Thailand, and Vietnam, and in close collaboration with ASEAN Secretariat. It aims to undertake a situation analysis of ASEAN member countries’ efforts to achieve vaccine security by utilizing a combination of tools: • Global desk review to benchmark ASEAN countries with other regions, flag known best practices, identify key bottlenecks in ASEAN access to vaccines, and highlight constraints and opportunities. • Deep-dive country case studies (Indonesia, Malaysia, Philippines, Thailand, and Vietnam) to present key opportunities and challenges. • Private sector landscape analysis (value chain analysis) to cover both backward and forward integration of vaccine development and manufacture, and identify the challenges and opportunities of private sector investment. • Economic analysis of vaccine security, to provide unprecedented and detailed benefit-cost ratios (BCR) for investing in vaccine R&D, manufacture, and regulatory strengthening in the ASEAN region. • Consultation of key stakeholders, to create an effective platform for senior policy makers and private sectors to share their perspectives on ASEAN regional vaccine security collaboration. 11. Five ASEAN region member states—Indonesia, Malaysia, Philippines, Thailand, and Vietnam—were selected for deep-dive analyses of their country’s vaccine R&D, manufacturing, and regulatory systems. These countries were selected based on their potential for contribution to the vaccine manufacturing value chain, determined by whether they met certain criteria. World Bank Group study teams in each country were organized to i) engage high-level stakeholders from government, regulatory agencies, academia, private sector, and civil society to identify relative strengths and weaknesses in each country’s technical and human resource capacity for future vaccine manufacturing needs; and ii) conduct reviews to identify and assess environmental, political, and economic factors that might affect manufacturing potential. In addition, consultant teams performed rapid benchmarking of domestic manufacturing capacity to produce vaccines using new technological platforms (i.e., mRNA, viral vector and protein sub-unit) through existing capacity or technology transfer arrangements with external strategic partners. 12. This research culminated in country profiles that describe each country’s vaccine procurement and distribution systems, manufacturing capacity (current and potential), and strength of vaccine marketing and regulatory systems. Taken together, the profiles identify critical gaps in the ASEAN region with regards to vaccine manufacture, quality control, marketing, and distribution logistics, and generate realistic opportunities for coordinated resource-sharing among ASEAN countries, thereby contributing to the regional public good. 13. This situation analysis is complemented by an economic analysis of the costs and benefits of regional vaccine manufacture, and a study of evolving lessons from other regions that embarked on similar journeys.viii Based on these analyses, the study proposes several options for promoting ASEAN regional vaccine manufacture and summarizes the potential opportunities and challenges of each. It also identifies possible areas for foreign direct investments over the medium term, including bilateral support from other governments and multilateral agencies. The World Bank and International Finance Corporation (IFC) lead this study in partnership with the UK Foreign Commonwealth Development Office, and the Global Financing Facility for Women, Children and Adolescents. viii China, Japan, India, and Republic of Korea 11 ASEAN Vaccine Situation 14. The WHO and United Nations International Children’s Emergency Fund (UNICEF) define vaccine security as sustained, uninterrupted, and timely supply of affordable vaccines of assured quality.ix The ASEAN Leaders’ Declaration on AVSSR reiterates three critical elements for assuring vaccine security in the region: (i) guaranteed procurement of vaccines through firm contracts with manufacturers; (ii) secure, multi-year allocations for vaccine financing; and (iii) long-term, accurate forecasting of vaccine requirements. The COVID-19 pandemic heightened this commitment and focused more attention on optimizing potential for regional vaccine development and manufacture. There is also increasing concern about other endemic tropical diseases such as Japanese encephalitis, dengue, and leishmaniasis, which receive limited priority for big pharma vaccine development. While AVSSR provides a basic framework, further research is required to assess the technical, operational, and financial viability to advance vaccine development and manufacture as a regional public good and an important measure for ensuring pandemic preparedness. 15. ASEAN countries in general have robust NIPs and report more than 85 percent coverage of the eligible populationx for Bacille Calmette-Guerin (BCG); diphtheria-tetanus-pertussis (DTP) containing vaccine; oral polio vaccine (OPV) 3rd dose; and Haemophiles influenza type B (Hib) 3rd dose at the regional level. Slightly lower vaccine coverage (73-75 percent) is reported for hepatitis B birth dose, pneumococcal conjugate vaccine (PCV), and measles-containing vaccines. ASEAN member states strongly support their NIPs and invest in the introduction of new or underutilized vaccinesxi in their routine immunization programs. Among the 10 ASEAN countries, seven have introduced one or two doses of scheduled HPV vaccine and six countries have introduced PCV. 16. The decision-making process to introduce a new vaccine in NIPs among the LMICs differs from country to country but always involves the National Immunization Technical Advisory Group (NITAG). Established in all ASEAN countries, the NITAG advises Ministries of Health and Governments on prioritizing introduction of new vaccines in line with recommendations of the WHO Strategic Advisory Group of Experts on Immunization. In addition, the WHO facilitates disease burden analyses and other cost studies to inform Government decision- making, and organizes annual regional NITAG meetings with immunization partners to share NIP performances, challenges, and findings from relevant studies to monitor program and discuss introduction of new vaccines. In the meantime, UNICEF and the Pan American Health Organization (PAHO) supply divisions, WHO, Gavi, the Bill and Melinda Gate Foundation and other partners hold consultations with vaccine manufacturers to support R&D and stimulate investments with advance market commitment mechanisms to ramp up production including prequalification of vaccines. This process enables UNICEF and PAHO—who undertake pooled procurement of more than 40 percent of global vaccine demand—to issue long term procurement contracts. Since 2000, this bottom-up collaborative decision- making process has been very successful to accelerate the introduction of new vaccines in the NIPs of MLICs, first with hepatitis B, then conjugate vaccines i.e.: DTP-Hep B, DPT-Hep B-Hib, measles and rubella, MMR, and more recently IPV, HPV, JE, PCV, and rota. This vaccine introduction process addressed demand and production aspects, helped lower vaccine prices of new and underutilized vaccines, stimulated new entrants from MICs and emerging economies, and could be a source of inspiration for the ASEAN region. 17. ASEAN member countries have been active in vaccine R&D. A 2018 ASEAN vaccine baseline survey on vaccine development and manufacturing capacity of ASEAN member states, undertaken by the National Vaccine Institute ix Vaccine security (who.int) x WHO/UNICEF Joint Reporting Form xi Vaccines that have not been introduced into national immunization schedules in all countries where recommended by WHO 12 (NVI), Ministry of Public Health, Thailand in preparation for a meeting on ASEAN Vaccine Security, shows that five ASEAN countries—Indonesia, Myanmar, Singapore, Thailand, and Vietnam—have varying capacities ranging from conducting clinical trials to vaccine production (Table 1.1). Indonesia, Thailand, and Vietnam have since developed and manufactured more products, including COVID-19 vaccines, through fill and finish arrangements, illustrating the dynamism of vaccine manufacturers within the ASEAN countries, a significant asset for building regional vaccine security. 18. However, despite the growing manufacturing capacities of Indonesia, Thailand, and Vietnam, existing ASEAN vaccine production is far from meeting the current ASEAN vaccine demand for NIPs and emergency response for future disease outbreaks and pandemics. Further, regional production is largely driven by the public sector. ASEAN member states still procure a large volume of their vaccine requirement from manufacturer members of the Developing Countries Vaccine Manufacturers’ Network (DCVMN), and directly from big pharma companies for new vaccines, such as PCV. Table 1.1. ASEAN country capacity for vaccine development and production Country Clinical Trials Production Capacity Upstream Down Stream Indonesia rotavirus, typhoid, IPV, MR, OPV, measles, TT, BCG, DT, HB, seasonal flu pandemic flu DTO-HB-Hib, Td, DTP-HB Myanmar HB, TT rabies Singapore bulk vaccine pneumococcal Thailand dengue, JE, DTP, BCG, JE rabies, IIV, OPV, HB, chikungunya, inactivated DTP-HB, measles, and live attenuated MMR, JE influenza, EV71, leptospirosis, house dust mite Vietnam seasonal flu, H5N1, JE HB, Hep A, JE, cholera, BCG, TT, Td, DTP, typhoid, OPV, rotavirus, measles 19. ASEAN countries have made limited investments in the R&D of vaccines and biologicals and are still dependent on imports for critical raw materials, manufacturing equipment and consumables. These gaps expose the ASEAN region to shocks in times of public health emergency, with significant impacts on lives and economies. Indonesia, Vietnam, Malaysia, Thailand, and Singapore are at various initial stages of expanding their roles on the vaccine value chain, which span from active ingredient procurement, to fill and finish production, to last mile delivery logistics. While an established framework for ASEAN vaccine collaboration exists, there has been minimal coordination between countries to collectively procure COVID-19 and other vaccines, leading to a missed opportunity to negotiate prices, stockpile, and prepare for disease outbreaks and pandemics. Despite these limitations, vaccine manufacturers and universities in five ASEAN countries have entered partnerships to develop COVID vaccines using new platforms as shown in Table 1.2. Additionally, there has been increased attention to developing vaccines for locally endemic diseases such as dengue, Japanese encephalitis, and leishmaniasis. 13 Table 1.2. ASEAN partnerships for COVID-19 vaccine development Countries Vaccine manufacturers R&D COVID-19 Partners and vaccines for NIP production Indonesia PT Bio Farma: DT, Td, TT, mRNA vaccine Vero cell inactivated • SINOVAC (fill and finish product) BCG, OPV, DTP, influenza HA, COVID-19 sub-unit vaccine sub-unit • University of Manchester for JE, MR, measles, DTP-HB-Hib, by PT Biofarma (in proficiency in mRNA seeds Hep B (recombinant), ACYW collaboration with Baylor • Baylor College of Medicine with (meningitis vaccine), varicella College of Medicine), on PT Biofarma for sub-unit COVID- inactivated COVID-19 19 vaccine Vaccine from Indonesian • Airlangga University, Indonesia seed by PT Biotis (seed formula development of Pharmaceutical Industry (in inactivated ) for the collaboration with Airlangga manufacturing by PT Biotis Pharm University), on mRNA Ind COVID-19 Vaccine by PT • Yuxi-Walfax China with PT Etana Etana Biotechnologies Biotechnologies Indonesia for Indonesia development mRNA COVID-19 vaccine in Indonesia (on-going) Malaysia N/A mRNA, COVID-19 Under development • Universiti Putra Malaysia (UPM), inactivated vaccine Universiti Malaya (UM), Partnership Chulalongkorn University Thailand 25/02/2022 • Pharmanagia Berhard, BioNet Thailand and Bio-Innova Thailand Thailand BioNet: Hib, DT, TT, Td, DTP, • Needle-free SARS-COV2 Under development • Technovalia and Pharmajet DTP-HB-Hib, aP, TdaP, DNA vaccine • Chulalongkorn University, Penn influenza, JEV, measles, COVIGEN(CT1) University (USA), TriLink rabies, OPV • mRNA vaccine (CT2/3) Biotechnologies (USA) • Chimeric live • Queen Saovabha Memorial attenuated dengue Institute, Liaoning Cheng Da vaccine Biotechnology China (rabies vaccine) Siam bioscience: COVID-19 NA Sixty-one million • Astra Zeneca Catalent Italy doses in 2021 and 60 million in 2022 finish products delivered by Astra Zeneca and local production of 700,000 doses by production cycle. GP: N/A inactivated Newcastle Under development • Icahn School of Medicine at Disease Virus COVID-19 Mount Sinai (ISMMS) – Medical vaccine CT 1/2 School New York city, the University of Texas at Austin (UTA) and PATH Vietnam Vabiotech: measles, OCV, ARCT-154 Self-Amplifying Under development • Arcturus Therapeutics Holding Inc. influenza vaccine, hepatitis A, RNA SARS-CoV-2 Vaccine in San Diego US hepatitis B, JE. Other NIP vaccines are imported Lao PDR Protein subunit • Luye Pharma vaccine Singapore Underdevelopment • BioNTech 14 20. Although challenges exist with the overall eco-system for vaccine development and manufacture in the ASEAN region, advancements continue. Singapore’s strong regulatory system rendered it the first country among ASEAN member states to achieve WHO maturity level 4, though its experience is limited to biological production. Three National Regulatory Authorities (NRA) in the ASEAN region—Indonesia, Thailand, and Vietnam—have achieved maturity level 3, the minimum required for WHO prequalification or issuing Emergency Use Listing (EUL) for vaccines, and Malaysia is making intensified efforts to reach maturity level 3. The capacities of other ASEAN NRAs are variable. 21. Regulatory harmonization efforts in the ASEAN region were initiated nearly two decades ago, but have not progressed with agility or pace, a key area the ASEAN Secretariat working with member states could possibly play a catalytic role to advance. Due to lack of progress in regulatory harmonization, separate regulatory clearances are required by each NRA for introduction of new vaccines. Such regulatory hurdles, along with a lack of standardized packaging requirements, and non-acceptance of international halal certification by some countries in the region, place additional burdens on manufacturers. Further, the commitment made by ASEAN governments to introduce multi-year contracts for vaccine procurement has also not yet materialized. Progress towards regionally pooled procurement and pricing has not made much headway so far. These factors make the region less attractive for private sector investments. 22. To ensure a sustainable supply of vaccines for NIPs, and to respond to future pandemics and locally endemic diseases, ASEAN countries need to focus on building regional capacity for R&D, strengthening regulatory capacity to ensure quality and efficacy, and scaling-up production for selected vaccine products of public health importance that are in limited supply. Such efforts must consider emerging lessons from other regions, projected trends in regional disease burden including locally endemic neglected tropical diseases, socio-economic rationale, and potential contribution of ASEAN member countries to the global vaccine value chain. 15 Chapter 2: Vaccine Security Coordination 1. Regional vaccine security requires a coordinated approach, efficient and equitable routine immunization, and effective resilience and response to new disease threats and future pandemics. Responsible coordination considers the economic rationale, and complementarity among ASEAN member countries in augmenting vaccine value chain and identifying clear achievable pathways to promote regional vaccine manufacturing. Economic Rationale for Regional Vaccine Security 2. The call to make vaccines affordable and available to everyone, everywhere—essentially to make them a global public good—is embedded in the idea of universal health coverage.xii Cost-effectiveness reviews of available evidence suggest to policy makers that vaccines in LMICs are an efficient investment.xiii However, many countries shy away from investment in vaccine development and manufacture because of the huge costs, complexities, and associated risks. Box 2.1. The challenges and costs of vaccine research 3. Vaccine development is intensively Challenges knowledge-based, costly, risky, and time • Vaccine research is reactive. Despite three decades of consuming. Industry barriers to entry are research, Ebola human trials were limited to two vaccine difficult to overcome, and failure rates candidates until the mid-2000s. are high. Fewer than one in ten vaccine • Vaccine trials notably occurred during epidemics with candidates achieve licensure. New evolving epidemiology. vaccine development is estimated to • Waning interest. By the time funding materialized to cost US$500 million to US$1 billion, combat each outbreak case prevalence fell, and including large scale clinical trials to imminent danger receded. prove efficacy and safety, and scaling up Costs of production and acquisition of • High failure rates. Only 10.7% of vaccines advance to phase 1, and 2.7% to phase 2. technology. Further, acquisition of local • Cost prohibitive. Including the risk of candidate non- products by bigger competitors limits advancement, costs per successful candidate could range the competition, rendering the vaccine from US$319-469 million. market oligopolistic.xiv However, if the • Burdensome regulations. Total cost for succesful market and governments create a candidate may reach up to US$2.5 billion by the time it favorable eco-system, such investments obtains licensing. could still be worthwhile, especially Source: Joel N Maslow. The cost and challenge of vaccine development for emerging and emergent infectious considering challenges encountered by diseases; The Lancet.com Vol 6. December 2018 LMICs to access COVID-19 vaccines. In addition, ongoing demographic and epidemiological transmissions in ASEAN countries demand a self-sufficiency in biologicals and biosimilars to handle the emerging burden of non-communicable diseases. These challenges and costs are outlined in Box 2.1. xii Are vaccines a global public good? Priya Joi; 11 September 2020, Are vaccines a global public good? | Gavi, the Vaccine Alliance xiii Ozawa S, Mirelman A, Stack ML, Walker DG, Levine OS. Cost-effectiveness and economic benefits of vaccines in low- and middle-income countries: a systematic review. Vaccine. 2012 Dec 17;31(1):96-108. doi: 10.1016/j.vaccine.2012.10.103. Epub 2012 Nov 8. PMID: 23142307. xiv India’s vaccine growth story-From Cowpox to Vaccine Maitri; Sajjan Singh Yadav 2022 ISBN 978-93-5479-523-7 (PB) 16 4. A recent studyxv assessed investing in late-stage clinical trials, trial sites, and production capacity of new health products for prevention and control of infectious diseases by improving access to vaccines, therapeutics, and diagnostics in three middle-income countries: India, Kenya, and South Africa. The study compared the BCRs of making such investments at country and regional levels. The study estimated that over a period of 15 years from 2021 to 2036, product development and manufacturing in Kenya could avert approximately 4.44 million deaths and 206.27 million DALYs in the Common Market for Eastern and Southern Africa region. In South Africa, it could prevent 5.19 million deaths and 253.83 million DALYs in the Southern African Development Community (SADC) region. In India, it could avert 9.76 million deaths and 374.42 million DALYs. Economic returns would be especially high if new tools were produced for regional markets rather than solely for domestic markets. The BCRs for the regional scenario were estimated to be 20.51 in Kenya, 33.27 in South Africa, and 66.56 in India, where the corresponding BCRs limited to the country level are 0.73, 2.85, and 27.82 respectively for Kenya, South Africa, and India. See Figure 2.1 below. 15-Year Benefit-Cost Ratios (BCR) of Regional vs. Country Marketing of Selected Vaccines Regional: COMESA, SADC, and 8 Countries in South Asia Countries: Kenya, South Africa, and India 70 60 50 40 30 20 10 0 Kenya South Africa India Regional Scenario Country Scenario Figure 2.1 Benefit-cost ratio of regional vs. country marketing Vaccine Manufacturing and Access in the ASEAN Region 5. In terms of vaccine manufacturing, ASEAN countries can be viewed under three clusters: producers, recipients, and purchasers.xvi ASEAN producers—Indonesia, Thailand, and Vietnam—constitute three major vaccine hubs in the region and have fill and finish as well as strong upstream capacities for manufacturing traditional vaccines. Malaysia recently started fill and finish for COVID-19 vaccines in partnership with CanSino, while Lao PDR recently issued Emergency Use Authorization (EUA) for a new COVID-19 vaccine, which is locally produced in partnership with Luye Pharma. ASEAN recipients—Cambodia, Lao PDR, and Myanmar—primarily xv Investing in late-stage clinical trials and manufacturing of product candidates for five major infectious diseases: a modelling study of the benefits and costs of investment in three middle income countries. Marco Schafehoff, Armand Zimmerman, Mohamed M Diab, Wenhui Mao, Vipul Chowdhary, Davinder Gill, Robert Karanja, Mziwandile Madikizela, Osondu Ogbuoujit, Gravin Yamey. www.the lancetcom/lancetgh Vol 10 July 2022 xvi ASEAN: Domestic Vaccines manufacturers, Carole Bruckler, Partner, Head of Asia Pacific at Deallus Consulting, PM LIVE December 3, 2013 17 rely on Gavi-funded vaccines procured through UNICEF and non-governmental with international organizations to facilitate implementation with Ministries of Health. ASEAN purchasers—Brunei, Malaysia, Philippines, Singapore and Thailand—buy vaccines for their governments as required by national immunization schedules and for self-financed private markets as per demand. 6. Slow progress in regulatory harmonization and inability to implement pooled procurement, lack of standardized vaccine specifications, and universal packaging practices acceptable for all countries have created barriers to access vaccines produced within the ASEAN region. In addition, some countries in the region have specific halal certification requirements that introduce additional market separation. Pathways for Achieving Vaccine and Biological Production 7. The COVID pandemic has shown the impact of underinvestment in development, production, and distribution of biologicals,xvii and the negative impact on lives and economies of too much centralization of bio- manufacturing capacity. While many ASEAN countries do have basic building blocks, they need enabling government policies that address gaps in eco-systems including improved regulatory capacity, long-term market commitments, and relevant partnerships for technology transfer and capacity building. In addition to vaccine security, with more countries graduating from Gavi support and gradual expiry of commonly used vaccine patents and UNICEF procurement facility, more business opportunities will emerge for countries and the private sector to invest in new manufacturing plants, especially as multiple production sites reduce production and transportation costs. 8. A comprehensive analytical report by Merck identified four pathways to achieve biological production by a country or region.xviii These pathways require (i) sound regulatory systems that ensure effective biosimilar approvals and meet the most stringent global standards of safety and efficacy, and (ii) strong and sustained international technical partnerships to scale, innovate, and bring in additional resources. Merck’s four pathways are presented in Figure 2.2 below. While the pathways summarize key ingredients of success, each country and region can forge its own pathway to leverage technical, policy, and other context specific factors. xvii Include a range of products including vaccines, monoclonal antibodies and gene therapies xviii Making Biologics: How and why more countries are getting into the game? Merck 18 Figure 2.2 Four pathways to achieve biological production by a country or region model with a Fill and nish of guaranteed market share of Sinovac COVID vaccine by target products in public Bio Farma procurement Fill and nish of Investment in A COVID vaccine by regulatory standards with Siam Bioscience. high a breaks to local Fill and nish of manufacturers to compete CanSino COVID vaccine in global markets romote Sta te Invest in Backward by Solu on Biologics s upported Stra tegi c Integra on Shi Cost m Euro Cost m Euro ime years ime years Sound egulatory System mee ng Strong and sustained interna onal global best prac ces in safety and technical partnerships e cacy Build on e per se E pand e is ng from other sectors knowledge base Cost m Euro Cost m Euro ime years ime years Used e is ng ransforming gene c engineering skills e is ng govt. D ins tute from Agriculture sector to biological manufacture Bio Farma Building on e is ng pharmaceu cal e per se in small molecules. Source: Author’s summary from Making Biologics: How and Why More Countries are Getting into the Game - Merck Pathway 1 – Promote State Supported Strategic Shift 9. Under Pathway 1, the government plays a critical role to rapidly build capacity of local players by establishing the entire value chain for biologicals under one grand initiative. 10. Brazil undertook a large public-private partnership initiative to overcome the challenge of spending nearly a third of its universal healthcare budget on imported biologicals. This strategy helped to rapidly build collaborations between local manufacturers and international knowledge partners, including regulators, and promoted knowledge transfer while ensuring secure and reliable market access to the knowledge partner. The government also made significant investments in development of NRA capacities to achieve WHO prequalification for exporting vaccines. This model is unique because it involves knowledge transfer between a third-party government facility and local companies which helps build expertise within the country. The initiative went to scale and helped increase domestic production of vaccines and reduce the government’s import bill for vaccines. 11. South Korea followed a different approach. Government-led investments in world-class regulatory standards, such as those of the US Food and Drug Administration (FDA) and European Medicines Authority, coupled with extensive tax breaks, helped South Korea achieve a global leadership position in biosimilar production. The government encouraged its local manufacturers to undertake contract manufacturing for global players in biologics, and it recently announced a new US$20 billion initiative to remove tariffs on inputs and equipment imported for biopharmaceuticals. 12. In India, strong government support in the past few decades has been the key driver for vaccine industry growth, along with a large population and high domestic demand for vaccines, the expansion of the Universal Immunization Program, and intentional use of public procurement to support domestic manufacturers, 19 research, funding, and regulatory facilitation. The Government of India established the Department of Biotechnology in 1986 to promote self-reliance in vaccine production, and biotech startup funding was provided by the Biotechnology Industry Research Assistance Council and Small Business Innovation Research Initiative under the Department of Biotechnology. Vaccine trial capacity was built by the Translational Health Science Technology Institute, the Indian Council of Medical Research, and the Council for Scientific and Industrial Research, and created repositories and biosafety level-4 facilities. The Government of India also facilitated industry academia collaboration through the National Biopharma Mission, and funding for vaccine manufacturing facilities technology through the development board of the Department of Science and Technology. 13. Because India entered into strategic partnerships with CEPI, and the Indian Council of Medical Research entered into a memorandum of understanding with the IVI for collaborative research in vaccinology,xix India is now estimated to meet 62 percent of worldwide demand for NIP vaccines, with more than three fourths of vaccines produced in the country exporting to more than 170 countries. India meets 90 percent of global demand for measles and 40–70 percent for DPT and BCG vaccines.xx The vaccine industry developed by India also contributed to the COVID-19 vaccine market, supplying over 60 million doses of COVID-19 vaccine to 76 countries, a little over 17.7 million doses to the COVID-19 Vaccines Global Access Initiative, and 34 million doses through commercial deals.xxi Pathway 2 – Invest in Backward Integration 14. Pathway 2 involves a government initially supporting domestic manufacturers to undertake a simpler and lower value process, and then gradually moving higher in the production value chain in partnership. The ASEAN region has excellent examples of this approach. 15. The Government of Indonesia introduced several policies and economic incentives to facilitate growth of domestic biological manufacturing capacity. Key economic incentives include a tax holiday for investment above Rp 500 billion, tax reduction for investment of Rp 100–500 billion, and super tax deduction for successful R&D,xxii including exemption from import duties for machinery, goods, and materials for industrial construction and development for a period of two years.xxiii 16. Most vaccines used by Indonesia’s NIP are being produced by PT Bio Farma, a government-owned vaccine manufacturer.xxiv PT Bio Farma has the upstream production capacity for OPV, measles, TT, BCG, DT, DTP-HB- Hib, Td, and DTP-HB vaccines, and downstream for HB and seasonal flu vaccines, and most of these vaccines are WHO prequalified. The overall production capacity is around 146 million for bacterial vaccines and around 0.8 billion for viral vaccines. PT Bio Farma is also exporting to more than 150 countries and is a large supplier of vaccines to UNICEF and PAHO. The company undertakes the fill and finish of COVID-19 inactivated vaccines in collaboration with two Chinese manufacturers, Sinovac and Sinopharm. The production capacity per year for the COVID-19 vaccine Sinovac is 250 million doses. Four new entrants of domestic vaccine manufacturing in Indonesia, in collaboration with the Airlangga University and other foreign partners, have recently manufactured COVID-19 vaccines as their starting point and plan to produce a broader set of vaccines. xix India’s vaccine growth story-From Cowpox to Vaccine Maitri; Sajjan Singh Yadav 2022 ISBN 978-93-5479-523-7 (PB) xx Pharma industry in India: Invest in Indian pharma sector. Investinida.gov.in.2022. http//ivma.in/the-Indian-vaccine- industry-a-brief-overview/ xxi Next on the list - A brief summary of India's vaccine supply to the world | The Economic Times (indiatimes.com) xxii Regulation of the Minister of Finance of the Republic of Indonesia No. 130 /PMK.010/2020 concerning Regulation of the Ministry of Finance (PMK) regarding the Provision of Corporate Income Tax Reduction Facilities. xxiii https://jdih.kemenkeu.go.id/fulltext/2015/188~PMK.010~2015Per.pdf xxiv https://www.biofarma.co.id/media/image/originals/uploads/2019/09/Riwayat-Sangkat-Perusahaan.pdf 20 Pathway 3 – Build on Expertise from Other Sectors 17. Under Pathway 3, the know-how required for biological manufacturing is borrowed from existing industries in other sectors already possessing human capital. 18. The Singapore government took advantage of existing pharmaceutical expertise in small molecules to build R&D capacity in biologicals by providing tax deductions and grants for skill development. More than 300,000 engineers and technicians were trained in biological manufacturing over the last decade which transformed Singapore into a global manufacturing hub for biologicals. 19. Argentina used existing genetic engineering skills from the agricultural sector to build a biosimilar industry. Currently, the country has more than half a dozen firms manufacturing biosimilars which helped to save about US$400 million in health care costs, and Argentina now exports products throughout Latin America and globally. 20. An evolving area under this pathway is the application of digital technology for developing new biologicals. For example, Roche recently acquired Foundation Medicine, a molecular information company focused on cancer, and bought Flatiron Health which maintains a repository of electronic health records in cancer care. In addition to existing pharma and diagnostic business, Roche started focusing on personalized healthcare. The biotech company established Solutions, an innovation center in Pune, India, and is set to unveil another innovation center in Basel, both of which are expected to collaborate on breakthrough medicines. Pathway 4 - Expand Existing Knowledge Base 21. Pathway 4 builds on the existing R&D base in biologics within a country. 22. Indonesia’s Bio Farma is an excellent example of this approach. Originally established as a government institute for R&D in 1980, the company has transformed into a successful biologics production facility, with an initial knowledge transfer partnership with Japan’s Biken Research Institute for Microbial Diseases to produce the polio vaccine, followed by contract manufacturing in partnership with India. PT Bio Farma is also making advances to produce cancer fighting monoclonal antibodies. With support from the Indonesian government and WHO,xxv PT Bio Farma is also developing a hub to produce COVID-19 vaccines using the mRNA platform. 23. The mRNA technology transfer hub program facilitated by CEPI, Gavi, UNICEF, and WHO, with support from several partners, aims to build sustainable vaccine manufacturing capacity in regions where it is limited or nonexistent, as well as support human capital for regulation and biomanufacturing in LMICs. Other potential mechanisms should also be explored. For example, the business-to-business model between domestic manufacturer and foreign partner, supported by the government, accelerates technology transfer and domestic production. 24. None of these pathways are mutually exclusive. There could be appropriate permutations and combinations to meet specific contexts. xxv Result of interview with PT Bio Farma at the end of April 2022 and internal data provided. 21 Chapter 3: ASEAN Vaccine Value Chain 1. A strong vaccine value chain is critical to a successful eco-system. It encompasses multiple elements directly related to vaccine manufacturing including raw materials, consumables, skilled and experienced human resources, infrastructure for primary manufacturing, filling and finishing, testing, and batch release after manufacturing process oversight of an NRA,xxvi including support services covering warehousing, sales, and distribution. Components of the value chain for product availability upstream of manufacturing include R&D for new vaccines, investments in clinical trials, and obtaining regulatory approvals. ASEAN Vaccine Manufacturing 2. Vaccine manufacturing capabilities and maturity vary among ASEAN countries for several reasons including government priorities and support, geo-politics, country demographics, influence of large and/or advanced countries in Asia (i.e., China, India, Japan, and South Korea), investment environment, and historical influences. Vaccine manufacturing was established in the region as early as the late 19th century, and some countries have a long history of government support for local industry manufacturing of some essential vaccines included in their NIPs. Over the years, Thailand, Vietnam, and Indonesia have developed local manufacturing capabilities, while the remaining ASEAN countries have small facilities, veterinary vaccine manufacturing only, or no current vaccine manufacturing capacity. Despite local capabilities, most countries, apart from Indonesia and Vietnam, depend on outside manufacturers for most of their NIP vaccine requirements. 3. Although the ASEAN region has producer countries (Indonesia, Thailand, and Vietnam), recipient (Gavi- funded) countries (Cambodia, Lao PDR, Myanmar), and purchaser countries (Brunei, Philippines, Malaysia, and Singapore), there are pockets of other vaccine capability, for example Myanmar has one site that produces hepatitis B vaccine and snake antivenom. Other countries such as Malaysia have some animal vaccine capabilities and recently started fill and finish of COVID-19 vaccines, and in Singapore the Economic Development Board announced a project to establish a COVID-19 vaccine production facility with support from BioNTech. Several antigens are being manufactured across the region. 4. Many of the locally-produced vaccines have been manufactured over several decades and introduced initially through technology transfers by the Pasteur Institute and others. Additional manufacturing capabilities have been introduced through technology transfers from external strategic partners, such as the measles vaccine transfer (Kitosanto) and Polyvac and influenza vaccine transfers (Sanofi) to Thai vaccine manufacturer GPO. Vaccine Development and Innovation 5. Many manufacturers in the ASEAN region are public or state-owned. Until recently, there has been a lack of innovative vaccine development in ASEAN countries except for avian influenza capability built in Thailand after outbreaks. Most vaccines manufactured in the region were developed before the 1970s. One major inhibitor to innovation in ASEAN countries is that newer products added to national immunization schedules are developed and manufactured in other regions more quickly and less expensively, although PT Bio Farma in Indonesia and BioNet Asia (Thailand) have developed multiple technical partnerships and collaborations, including to build R&D capability across a range of newer vaccines. Figures 3.1 and 3.2 provide a comprehensive but non- exhaustive look at active vaccine development and manufacture partnerships in the ASEAN region. xxvi WHO-Listed Authority 22 Figure 3.1. Production capacity of routine (childhood) EPI vaccines among vaccine producing ASEAN member states Source: The ASEAN Vaccine Baseline Survey 2019 Figure 3.2. Production capacity of non-routine EPI vaccines among vaccine producing ASEAN member states Source: The ASEAN Vaccine Baseline Survey 2019 23 Supply and Demand Tension 6. Cambodia, Indonesia, Lao PDR, Myanmar, and Vietnam are all eligible for Gavi vaccine support, but many of them are in the process of graduating out of being supported and into self-financing status. Indonesia transitioned from Gavi support in 2021, while Lao PDR and Vietnam will be transitioning out of Gavi support soon. Cambodia and Myanmar are in early transition. The supply of these essential vaccines meeting WHO prequalification is dominated by imports contributing to more than 80 percent of total doses used in the ASEAN region. Locally manufactured vaccines by ASEAN counties contributed to less than 10 percent, and of that nearly 70 percent is supplied by PT Bio Farma in Indonesia. 7. The Asia Pacific vaccine market is expected to grow by 13 percent annually. A recent CEPI survey indicated a large amount of unused capacity for vaccine production among countries in the ASEAN region. The inability to expand capacity among these facilities is either due to production of vaccines for which the markets are currently small without much growth potential, or due to older facilities needing significant upgrades to maintain or increase production capabilities. The supply of vaccines manufactured by foreign manufacturers benefits from economies of scale and years of collaboration with Gavi, UNICEF, WHO, and other government agencies including capacity building for WHO-listed authorities (WLA). These manufactures will continue to threaten the sustainability of smaller facilities in ASEAN countries which do not have diversified product lines, technology platforms, or markets that offer opportunities for regional expansion or export. Also, public procurement policies do not allow payment of a higher price for regionally manufactured vaccines. Quality Assurance and Regulatory Systems Box 3.1. The Developing Countries Vaccine Manufacturers’ Network (DCVMN) 8. Five manufacturers in the region are • A public health driven alliance consisting of 43 manufacturers currently active members of the DCVMN (Box from 14 countries including Indonesia, Thailand, and Vietnam 3.1); GPO (R&D only) and BioNet-Asia in from the ASEAN region Thailand, Vabiotec and Polyvac in Vietnam, • Provides a platform for organizations to come together and PT Bio Farma in Indonesia. Among regional regularly to share technical information, best practices, and manufacturers, only PT Bio Farma and GPO- prospects MBP (Thailand, non-DCVMN member) have • Produces over 70 WHO prequalified vaccines, accounting for WHO prequalified vaccines. Vaccine quality half of total prequalified vaccines and safety are enforced and monitored • Plays an increasingly important role in public health, supplying through NRAs participating in the WLA over 50% of vaccine doses procured by UNICEF globally capacity building program. • Collectively, members have 181 vaccine projects in R&D including dengue, chikungunya, Zika, human papilloma virus, and PCV 9. The WHO prequalification program is linked • Combining DCVMN and international stakeholder support for to UNICEF to advise the organization’s Supply HR development and transfer for novel manufacturing Division on the quality and safety of vaccines technologies (mRNA, viral vector, and bio-conjugate), and supplied primarily to LICs. Over decades, as innovative packaging methods such as blow fill-seal and two- more vaccine products were manufactured in dimensional barcodes, will be a win-win for all in ensuring vaccine equity more countries, WHO assessments of vaccine Source: Benoit Hayman, Sonia Pagliusi; Emerging vaccine manufacturers are innovating for the next products and production processes evolved decade. Science Direct www.elsevier.com/locate.jvacx into today’s vaccine prequalification process. This requires a WHO-assessed, functional NRA to achieve a maturity level 3 in the manufacturing country, assuring vaccine safety and efficacy. All three ASEAN vaccine manufacturing countries, Indonesia (National Agency of Drug and Food Control – BADAN POM), Thailand FDA, and Vietnam, have achieved maturity level 3. The Vietnam regulatory system includes four complementary institutional mechanisms: the Drug Administration of Viet Nam, the Administration of Science Technology and Training, the 24 National Institute for the Control of Vaccines and Biologics, and the General Department of Preventive Medicine. 10. While Singapore does not currently produce vaccines, the Singapore Health Sciences Authority has recently been assessed by WHO to have achieved maturity level 4 indicating “regulatory systems operating at advanced level of performance and continuous improvement.” 11. Based on experiences of companies that have succeeded in gaining marketing authorization for their products in Singapore, Japan, S. Korea, EU, US, or that first entered the WHO prequalification program, it has been shown that significant investments are needed to update systems and facilities to comply with stringent regulatory standards for marketing authorization or WHO prequalification, even where required regulatory structures are in place. Even though vaccine-producing countries in the ASEAN region have this level of regulatory agency maturity, there is still a divergence between local regulations that govern national vaccine licensure and use, and prequalification for exports. There is currently little harmonization or reciprocity between countries despite long-term efforts to address the challenge. Further, there are some variations in vaccine schedules and packaging, and financial rules have hampered long-awaited vaccine licensing procedures. Navigating these systems can be cumbersome, costly, and time-consuming for manufacturers, and some companies are looking for opportunities to move outside the region because of this real or perceived added burden. Size and Age of Facilities 12. The decline in local vaccine manufacturing seen worldwide during the latter part of the 20th century due to globalization was felt in the ASEAN region as well. 13. More recently, some of the wealthier countries have been attracting investments in advanced manufacturing methods (such as in Singapore, with Sanofi’s new manufacturing facility, and BioNTech taking over the Novartis facility to manufacture mRNA products), manufacturers in other ASEAN countries need to maintain or upgrade older technology facilities. This will continue to put pressure on the stand-alone sustainability of many current manufacturers, and burden governments for supplementary government direct or indirect support. Impact of Pricing on Manufacture 14. Vaccine manufacturing facilities have high fixed costs. However, prices for most used non-novel vaccines are low. Tendering processes are different in each county and are decentralized even within countries in some cases, layering complexity for local manufacturers. Further, continued downward pressure on pricing is expected due to increased competition from local, regional, and global players impacting new market entrants. This gets further compounded by price sensitive governments guided by public procurement laws, stretched balance sheets, limited budgets, and competing priorities. As an example, the price for pentavalent vaccines declined by 76 percent between 2001 and 2017. In Vietnam, prices are fixed by the government purchasing them, these rates do not fully consider increase in production costs. Government financial rules and regulations for procurement do not allow multi-year procurement agreements with manufacturers. At the same time the facility and quality requirements have become more stringent, requiring additional capital and investment that is difficult to fund from sales margins alone. To mitigate these external pricing pressures some manufacturers are diversifying into higher margin products, investing into a range of other technology platforms, and expanding their customer base. 25 Sources of Vaccine Inputs 15. ASEAN countries, like the rest of the world, depend to a great degree on foreign sources for their raw materials, especially from the EU, the US, and to some extent India and China. Raw materials for vaccines are generally either low-cost buffers, or small-volume materials such as media components or enzymes. They are often components manufactured for other food, pharmaceutical, or chemical industries with vaccines as a secondary market, adding to the fragility of the supply. Even the eggs used for measles vaccine manufacturing come from outside of the ASEAN region, partly to ensure the quality of the material. 16. Fill and finish materials are higher volume components common to those used in the pharmaceutical industry where some level of manufacturing capability exists within the region. The exception is consumables used in the filling process, such as filters, plastic components, and highly specialized materials such as lipid nano particles used in the mRNA vaccine manufacture. There are very few manufacturers for these kinds of materials as a global market is required to justify investments and the products are often proprietary. Human Capital and Biotechnology Infrastructure 17. Human resources skilled and experienced in vaccine manufacture are present in some ASEAN countries and the situation is improving, although many companies still have challenges in recruiting and retaining skilled staff. This remains an important impediment to growth and quality of vaccine manufacturers for some countries. 18. Science education infrastructure support is present in countries currently manufacturing vaccines. There is, however, disparity between countries on the share of skilled workforce and the ability to attract and retain skilled workers. According to the recruitment firm The Manpower Group, the level of skilled workers in Vietnam was 12 percent in 2019 and university attendance for 18- to 29-year-olds was 28 percent compared to 43 percent and 48 percent respectively for Thailand and Malaysia. There is a strong recognition of the need to support workforce education and training including backing for biotech training in other regions. Thailand, which has multiple universities offering biotechnology-related programs, ranked sixth among 52 countries studied for education and workforce support of biotech. Vietnam also has an institute offering biotechnology training to students. 19. Training specific to biotechnology in manufacturing, good manufacturing practice (GMP), and registration/qualification processes are supported internally and through partnerships with technology transfer partners, foundations or technical organizations such as WHO, CEPI, Gavi, Bill and Melinda Gates Foundation, IVI, Biomedical Advanced Research and Development Authority, and Program for Appropriate Technology in Health. All manufacturers have partnerships with universities inside and/or outside the region, and some are operating as chief marketing officers for tech transfer with other manufacturers within the country and outside as well. In addition, product technology transfers often include training that is technical but often also improves general knowledge and capabilities in vaccine manufacture including GMP. On the technical training side, the WHO and IVI support vaccine, biotech, and GMP training programs to all regions, and such trainings continue to be enhanced under the mRNA technology transfer hub initiative. In addition to GMP training, WHO supports “mock inspections” to facilitate quality improvement of manufacturers. 20. Some partnerships within the region, for example BIOTEC in Thailand (part of the National Science and Technology Development Centre), try to bridge academia and industry by awarding scholarships to researchers in neighboring countries, especially Cambodia, Lao PDR, Myanmar, and Vietnam, to spend up to six months in the BIOTEC labs. Similarly, some international players are offering fellowship programs to build technical capabilities in the ASEAN region. 26 COVID-19 Pandemic Impact 21. The COVID-19 pandemic had an accelerating impact on the development of manufacturing capabilities in the region, both in the introduction of newer technologies, such as adenovirus vectored vaccines and mRNA, and the addition of fill and finish capacity. The pandemic induced several private manufactures, often ones with pharmaceutical experience, to begin developing capabilities for manufacturing new technologies and vaccines. This includes countries that had not previously maintained a vaccine manufacturing footprint such as Malaysia and Lao PDR. 22. The pandemic also enhanced collaborations with external companies to increase research and introduce new technologies that could be developed to the region’s advantage. For example, mRNA technology is being introduced in Singapore (Arctus Therapeutics and BioNTech), Indonesia (PT Bio Farma), and Malaysia (IMR). Recombinant protein technology has been added in Vietnam (Nanogen), adenovirus dendritic vaccines in Indonesia (Aivita Bio Medical) and Thailand (AstraZeneca), and protein subunit in Thailand (Baiya PhytoPharm). 23. One of the more significant impacts of the COVID-19 pandemic was that it prompted greater collaboration between the private sector and regulators, and between regulators of different countries. It also facilitated modalities for fast-tracking EULs and fostered an unprecedented level of collaboration between NRAs worldwide and WHO to coordinate product reviews for EUL. For example, Thailand FDA participated in the WHO review process of SINOVAC vaccine for EUL. 24. There were forums to improve cooperation among ASEAN countries for regionally harmonized approaches before COVID-19 but they had little impact. There were only exceptional examples of vaccines manufactured by an ASEAN country that were distributed regionally, for e ample Inviragen’s Japanese encephalitis vaccine manufactured by Vabiotech in Vietnam was distributed within the country as well in Cambodia and Myanmar. The impact and shock of COVID-19, however, brought about a realization that there can be better opportunities for vaccine security for the region if there is greater cooperation and effective harmonization among ASEAN member states. Distribution 25. National vaccine procurement and distribution may vary from country to country. Usually in countries that have domestic production the manufacturer is responsible for distributing the vaccines, at least to regional levels where there is an airport. In countries importing vaccines, the NIP usually manages its own distribution system under cold chain, however, there are variations. In Thailand, the National Health Security Office does the procurement process and GPO oversees distribution. The AMV Group in Vietnam markets and distributes vaccines across Asia. The responsibility to register beneficiaries and deliver vaccines including reporting adverse events usually rests with the sub-national/local government health departments. 26. There are also private sector companies at the regional and country levels involved in the distribution of vaccines, for example in Myanmar, Malaysia, Singapore, and Thailand. Some other countries, for example the Philippines and Indonesia, do have significantly-sized pharmaceutical distribution companies, but they are not currently involved in the vaccine supply chain. A large portion of distribution for COVID-19 vaccines imported to the region with significant cold chain requirements was managed by a single company, Zuellig. 27 Support Services 27. Support services, for example pharmaceutical water systems, engineering, and validation support, are often provided by companies that service the entire pharmaceutical industry and are available within the ASEAN region. Procurement and Sales 28. While there have been efforts to coordinate pooled procurement through the ASEAN AVSSR, there is no current common or reciprocal regulatory approvals or pooled procurement mechanism as in Latin America and Africa coordinated by the PAHO and UNICEF respectively, but there is an emerging recognition of the advantages of moving in that direction. Research Supplies and Services 29. Singapore, Vietnam, Philippines, Thailand, Malaysia, and Indonesia have companies that make and/or sell equipment and supplies for laboratory research. However, for the most part, the focus is on distribution of equipment and supplies that are manufactured elsewhere. Clinical Trial Capability 30. Clinical trials can be performed by hospitals, public agencies, vaccine companies, and contract research organizations (CRO). Foreign companies dominate the local clinical trial CROs in some countries such as PT Prodia DiaCRO Laboratories in Indonesia, CSI Medical Research and Singapore Clinical Research Institute in Singapore, and Aclaris in Thailand. The Philippines has 84 CROs recognized by the FDA and has a formal body for clinical research professionals. Although not restricted to vaccines, clinical CROs are considered a growth opportunity though insufficient staffing and regulatory harmonization hamper advancement. Challenges for ASEAN 31. ASEAN’s geographical location between China, India, Japan, and South Korea, all of which have vertically- integrated, large-scale domestic manufacturing with massive export capacity, remains a big challenge for the growth of domestic vaccine industry. This makes it very difficult for individual countries to compete. ASEAN leaders realized their dependence on just a few sources of vaccine especially during the pandemic, and are deepening efforts for coordinated vaccine R&D and manufacture potential. 32. Except for Indonesia, most vaccine manufacturers in the region cater to the domestic market. A business scale sufficient to support a sustainable business model through secure long-term contracts has yet to evolve. This challenge needs to be mitigated to justify the long-term investment in vaccine manufacturing. 33. The disjointed regulatory environment between countries, and the lack of oversight and support in the region increase complexity, cost, and timelines that can be better managed through a regional consistent, harmonized, long-term approach. 34. There is an urgent need to continue financial supports for NRA capacity building to sustain a minimum of maturity level 3 in an ever-changing vaccine R&D and production environment. The WLA process promotes collaboration, standardization, and mutual recognition mechanisms for the review of vaccines for market authorization. A first step is achieving an understanding of the specificity of the common technical dossier for vaccines across Asian regulators to move on ASEAN collaborative procedures. This would begin to improve the 28 convergence of the assessment and issuance process of market authorization by strengthening the current Joint Assessment Coordinating Group (JACG) of the ASEAN Consultative Committee for Standard and Quality - Pharmaceutical Product Working Group (ACCSQ-PPWG). 35. Before the pandemic, ASEAN heads of state raised concerns and made progress with the endorsement of the AVSSR initiative. This carried the mandate to explore feasibility of vaccine pooled procurement mechanisms that would require agreement on vaccine supplier lists, and licensing procedures for marketing authorization, even though countries make their procurement separately. 36. A lack of pooled procurement dealing with a large volume of vaccines secured with long-term procurement agreements impacts the overall investment environment for vaccine manufacture in the region. 37. Skilled human capital is a requirement. University systems and additional support for R&D capacity that help build appropriate training systems are critical for the development of a secure vaccine eco-system, including manufacturers’ ability to retain trained individuals. Opportunities for ASEAN 38. Halal certification is needed for vaccines in large populations within the region, and it is currently a challenge to meet that requirement in line with internationally accepted norms. It has been recognized by manufacturers in several countries in the region as an opportunity for new products that could have reach beyond national borders and ensure prompt certification of new vaccines under development. 39. The region collectively has a population of over 650 million, growing at approximately 1 percent annually, which is substantial enough to support manufacturers and suppliers if government commitment to work together and support regional manufacturing is strong enough. 40. The regional regulatory collaboration, particularly in pharmaceuticals, has been common practice for more than 30 years with the existence of technical pharmaceutical working groups on standards and requirements, including technical guidelines and some mutual recognition agreements on GMPs and bioequivalent/ bioavailability reports among ASEAN member states. However, regulatory harmonization has not progressed. 41. Manufacturing industry opportunities are anticipated to grow with the continued trend towards offshoring and the Plus One strategy.xxvii This could also provide opportunities for industries that support the vaccine and biologics industry. 42. The region has several endemic neglected tropical diseases such as dengue, malaria, Nipah, tick-borne typhus, and leishmaniasis that would benefit from enhanced international partnerships of local academic institutions in vaccine R&D. Unlike other regions such as Africa and Central Asia, there is significant vaccine experience in the region, which makes it easier to introduce these vaccines. There are universities, and pharmaceutical and distribution infrastructure, all of which could help develop an eco-system for local manufacture and delivery of vaccines for these neglected locally-endemic tropical diseases. 43. Further, the research, technologies, and knowledge platforms developed for new generation vaccines for COVID-19 can also be applied to other biologics and biosimilars. This has been recognized by some companies already developing those capabilities and adding to their product range. There are also vaccines being developed and licensed for purposes other than infectious diseases. A company in Thailand has developed and xxvii Avoiding investments only in one country and diversifying business to other countries. 29 introduced to the region a vaccine against dust mite allergies and mRNA technology that can also be used to develop future products against cancers. 44. Partnerships and technology transfers are becoming more common in the region with an understanding that a collaborative model is the best approach. 45. COVID-19 demonstrated both the potential and the challenges of the region. It accelerated technology development and transfer, and shifted dynamics in manufacturing and research. It promoted collaborations with global agencies and regional regulatory cooperation, including work-sharing. The boom created by COVID-19 is currently deflating due to reduced demand, leading to the stopping of several COVID-19 dependent vaccine initiatives and hesitation among players wanting to enter the field. Governments are starting to turn their focus to other neglected priorities as the pandemic subsides. 46. Efforts in ASEAN harmonization have been ongoing since the 1990s and COVID-19 provided a strong momentum to these efforts. Several new vaccines will be introduced into the region in the next few years. Local manufacturers are looking outside of their own countries to grow their market base. However, they are faced with lengthy regulatory timeframes and regulators who are overwhelmed with added activities, products, and processes. There remains a significant opportunity to sustain and accelerate the momentum from COVID-19, and to leverage regional cooperation towards strengthened, long-term, sustainable vaccine manufacturing capability in the ASEAN region. 30 Chapter 4: Developing a Regional Eco-system 1. Gaps and complexities in regional eco-system development raise challenges for ASEAN vaccine self- sufficiency. Addressing them requires high-level political commitment, effective governance structures, adequate financing within and across countries in the ASEAN region, and sustained informal communication channels. Other factors are a matter of chance, as observed by the rapid emergence of global response and support systems at the onset of the COVID-19 pandemic. 2. Economists use the eco-systemxxviii metaphor to describe an interconnected system of positive and negative factors contributing to the likelihood of a desired outcome. Finding the most efficient mix of supply- and demand-side measures and signals induces market participants to respond to incentives. To create an optimal ASEAN vaccine-secure eco-system, various factors require consideration: • Purchasing power and demand for vaccines, and incentives for vaccine manufacturing and distribution investment • Know-how, skilled labor, and basic infrastructure (utilities, transport, communications, information technology) available at reasonable cost • Access to financing and financial services • Rule of law and absence of undue political influence or rent-seeking • A predictable and manageable regulatory framework that protects against unfair competition once compliance is assured • Upstream and downstream capacity to ensure supply of required inputs and deliver finished products to users • Access to R&D capacity for product development, process facilitation, and product improvement to maintain competitiveness 3. Optimizing these factors increases the likelihood of obtaining a more resilient and scalable supply chain for vaccines, though it takes time for the system to stabilize and find equilibrium. Factors require variable timelines, and circumstances such as election cycles may further interfere with intentions, so prioritizing and/or breaking factors into smaller steps is advisable. 4. To sustain ASEAN vaccine manufacture over the long-term, planners must address certain strategic priorities: a) Invest in human capital. From the harvesting and manufacture of raw materials to patient delivery, the value chain for vaccines is highly technical, including for less-direct players such as regulators, buyers, researchers, and academic faculty. A human resource strategy that can supply appropriate talent to the right locations at the right times can ensure a natural workforce flow that preserves knowledge and sustains adequate levels of service. b) Align regulatory requirements. ASEAN countries should work towards aligning regulatory requirements for approval of clinical trials and marketing authorizations, including tariff barriers. The Latin American “reference agency” system is built on a regional agreement where regulatory decisions in countries with more capacity for assessments allows for fast-track registration in countries with less regulatory capacity. The current mechanism on JACG in the ASEAN region should be strengthened and expanded for vaccine and biological products. Also, AVSSR should be structurally coordinated with ASEAN technical working groups such as ACCSQ-PPWG. Such a better-coordinated system would reduce the cost and effort for manufacturers interested in developing and marketing products in ASEAN countries. xxviii https://www.resilience.org/stories/2007-05-20/economy-ecosystem/ 31 c) Harmonize procurement. A policy that harmonizes the procurement process among ASEAN countries to facilitate transactions, ideally on a joint regional digital platform or e-marketplace, can consolidate demand and offer more transparency for buyers and suppliers including a better price to governments. In the event of an outbreak, harmonized procurement would garner fast transactions based on pre- negotiated conditions. d) Optimize supply chain. Shortages of certain supplies have led to manufacturing delays or reduced outputs. Careful analysis of critically-limited inputs can prevent future system breakdowns. Solutions may include stockpiling at the regional level, diversifying suppliers, pre-negotiated purchasing agreements with vendors for emergency activation, investment into regional manufacturing, or development of alternative technologies to reduce the need for certain inputs. e) Balance public–private partnerships. : In ASEAN markets, both public and private sector manufacturers compete for supplying vaccines to the same market. An appropriate level playing field will be required for both sectors to have healthy competition in the development of new products and complement each other for the wider public good. f) ASEAN markets follow a two-tier system with both public and private companies sometimes competing for the same funding sources. Unless public companies are managed entirely for profit with the state functioning as a silent investor/shareholder, the cost situation and economic incentives are different for public and private companies, which can be an obstacle for private investment in areas covered by public companies. A well-designed public-private partnership could balance the interests of both partners. g) Develop technology framework. ASEAN countries should develop a common framework for technology transfer and intellectual property protection, based on global good practices and with a focus on practicality and transparency. SWOT Analyses for ASEAN Region 5. To develop a robust regional eco-system, ASEAN leadership should build on national- and regional-level strengths and opportunities and mitigate potential threats that undermine efforts to effectively coordinate on a regional public good. Table 4.1 summarizes identified regional strengths, weaknesses, opportunities, and threats (SWOT). 32 Table 4.1. Regional SWOT Summary Table Strengths Weaknesses ▪ Wide range of vaccine manufacturing experience and ▪ Most ASEAN countries rely on imported vaccines for capacity within the region their NIPs to some extent o Production: Indonesia produces WHO-prequalified ▪ Countries are dependent on imports for key vaccines on a large scale, Vietnam meets NIP ingredients for vaccine manufacture vaccine needs, and Thailand has limited though ▪ Existing regional vaccine manufacturing capacity is expanding production capacity (BCG, pertussis, mostly concentrated in state-owned enterprises and COVID-19 vaccines) ▪ Two countries have not yet reached maturity level 3 o Export experience: Indonesia, Thailand status, indicating weaknesses in market authorization o Collaboration to support R&D: Indonesia, and registration processes Thailand, Vietnam ▪ Countries with the biggest populations—Indonesia o Fill and finish: Malaysia, Thailand and Philippines—do not offer market guarantees to o Clinical trials: Philippines encourage private-sector investments ▪ Large population: With almost 700 million population ▪ Human resource capacity varies greatly between ASEAN provides a significant market for investment in countries, with some requiring substantial training and vaccine production skill building, especially for new vaccine technologies ▪ The ASEAN AVSSR framework is already in place, reflecting high-level political commitment which was further reinforced by COVID-19 experiences ▪ Strong government commitment across ASEAN region to support NIPs and make continual improvements by introducing new, underutilized vaccines Opportunities Threats ▪ Broad support for expanding vaccine manufacturing ▪ Increasing vaccine hesitancy could sustain high industry to meet regional vaccine needs, including by coverage rates by ASEAN countries Indonesia which currently holds ASEAN presidency ▪ A diversion of resources to other pressing government ▪ Regional interest in pooled procurement of vaccines priorities that were neglected during the COVID-19 after COVID-19 pandemic ▪ Indonesia and Vietnam identified as spokes for the ▪ Unstable political and economic environments due to mRNA vaccine technology transfer hub, which will evolving geo-politics help build capacity in new vaccine platforms ▪ Inability to harmonize vaccine registration across ▪ Two COVID-19 vaccine manufacturing partnerships countries in ASEAN region recently established—Solution Biologics in Malaysia ▪ Lack of standardized vaccine specifications and (CanSino) and Siam Bioscience in Thailand universal (neutral) packaging acceptable to all ASEAN (AstraZeneca)—improving regional access to these countries increases costs for manufacturers and slows vaccines vaccine registration processes ▪ Effective technical stewardship by NVI, Thailand to ▪ Lack of regional platform for sustained dialogue operationalize the AVSSR agenda between manufacturers and national governments ▪ Demonstrated political will to augment regional ▪ Competition from other countries with established vaccine ecosystem covering R&D, incentives to private vaccine manufacturing industries sector, capacity building, and regulatory strengthening ▪ Private sector manufacturers have not been ▪ Keen interest by private sector, which is currently strategically engaged in vaccine security discussions resource rich, to invest in ASEAN region Strategic Partnerships with Neighboring Countries 6. The Comprehensive Economic Partnership in East Asia (CEPEA) opens the possibility for collaboration with a range of countries that can supply vaccines, raw materials, skilled labor, academic cooperation, technology, and other ingredients for successful vaccine manufacturing. ASEAN vaccine manufacturers with a broad supply basis might be attractive to CEPEA and other partner countries. 33 Strategic Global-Level Partnerships 7. Since the inception of the COVID-19 pandemic, new initiatives have emerged to link the ASEAN region with global markets. Indonesia and Vietnam are identified as regional spokes in WHO’s m NA vaccine technology transfer hub, for example, and the Medicines Patent Pool is able offer access to new intellectual property rights, which makes ASEAN vaccine supply to global LMIC markets within reach. However, such global partnerships should be explored only after achieving regional optimization to avoid risk of dilution of management resources and political capital. Also, global initiatives launched after catastrophic events are not always sustainable, as the initial sense of urgency may fade as soon as other events take over. 8. Given the large population and growing economic power of the ASEAN region, proactive outreach to global innovators to explore early collaboration in R&D of new vaccines could be a successful strategy. Endemic diseases like dengue render ASEAN markets attractive for companies innovating in this area. The pursuit of private company partnerships requires open dialogue, which naturally allows policy makers to learn about the strengths and weaknesses of the regional markets from a manufacturer and investor perspective. ASEAN countries may benefit from partnerships with Gavi or UNICEF for models of communications assets such as expressions of interest and/or requests for proposal. Regional Eco-system Development Considerations 9. A strong, sustainable regional eco-system requires careful attention to infrastructure development at all levels of the process. Advisable actions include: • Develop regional technical human resources capacity. Building human resource capacity in both the private and public sectors, and project demand over a 5- to 10-year period, justifies investments in higher education and postgraduate training hubs, perhaps in collaboration with private companies, and assumes simultaneous upgrades in institutional, regulatory, and manufacturing capacity. Concentration of an expertise in one location creates gravitational effect attracting additional talent. Existing hubs can be leveraged, with an eye on regional equity so that all countries can benefit from the collaborative effort. • Identify potential reference agencies. The reference agency system (Latin American model) allows medicine regulators to develop capacity-building programs tailored to the roles of national agencies. Focus may be on registration of new molecules, building a regional hub for AEFI monitoring and management, clinical trial oversight, or executing national post-marketing surveillance for a product whose registration was based on the recommendation of a reference agency. • Establish regional procurement standards. Regional procurement standards utilizing an electronic platform that harmonizes procurement for all ASEAN countries opens the possibility to progress towards pooled procurement at a later stage. • Obtain domestic financing. Domestic financing is necessary for recruitment of experts, strengthening of institutions, development of human capacity, and investment into industrial capabilities. Once the eco-system is improving, private investment will target the region. • Strengthen regional institutions. The ASEAN Secretariat, for example, can coordinate regional-level actions towards eco-system vaccine security, such as amending regional collaboration agreements. 34 Chapter 5: Economic Benefits of Investing in ASEAN Vaccine Development, Manufacture, and Regulatory Strengthening 1. Vaccine security and self-sufficiency have received increased global attention in the wake of the COVID-19 pandemic. LMIC reliance on high-income countries and international organizations for vaccines renders them vulnerable to shortages during crisis situations when there is global competition for available vaccine doses. While international and regional efforts are now underway to increase LMIC vaccine manufacturing capacity, there is a strong need to provide economic rationale to justify such investments. 2. There are several ongoing global and regional collaborative efforts to address vaccine inequality. The African Union and Africa Center for Disease Control have established the Partnership for African Vaccine Manufacturing to build capacity and self-sufficiency in vaccine research, development, and manufacturing in Africa.xxix In addition, WHO and its partners have established an mRNA vaccine technology transfer hub in South Africa— with hub “spokes” in Africa, Europe, Latin America, and Southeast Asia—to build mRNA vaccine production capacity across LMICs.xxx,xxxi LMICs in Latin America, Europe, and Southeast Asia have also started collaborations with other countries to increase vaccine manufacturing capacity in their respective regions.xxxii,xxxiii 3. Establishing vaccine security and self-sufficiency is of particular importance to Southeast Asia. Countries in the region are dependent on imports not only for COVID-19 vaccines, but also to a large extent for NIPs. Moreover, Southeast Asia has long been recognized as a hotspot for emerging infectious diseases.xxxiv Over the last two decades, the region has experienced outbreaks of avian influenza, severe acute respiratory syndrome, middle east respiratory syndrome, Nipah virus, chikungunya fever, dengue, Japanese encephalitis, leptospirosis, and extensively drug resistant tuberculosis, which have collectively resulted in substantial morbidity and mortality.xxxv Increasing vaccine development, manufacturing, and regulation capacity in the region is therefore essential to ensuring that countries can sustain their immunization programs and respond effectively and efficiently to future outbreaks and pandemics. xxix African Union and Africa CDC launches Partnerships for African Vaccine Manufacturing (PAVM), framework to achieve it and signs 2 MoUs. (Accessed January 26, 2023). https://africacdc.org/news-item/african-union-and-africa-cdc-launches- partnerships-for-african-vaccine-manufacturing-pavm-framework-to-achieve-it-and-signs-2-mous/ xxx The mRNA vaccine technology transfer hub (Accessed January 26, 2023). https://www.who.int/initiatives/the-mrna- vaccine-technology-transfer-hub xxxi Recipients of mRNA technology from the WHO mRNA technology transfer hub. (Accessed February 2, 2023). https://www.who.int/initiatives/the-mrna-vaccine-technology-transfer-hub/recipients-of-mrna-technology-from-the-who- mrna-technology-transfer-hub xxxii Zeng, W., Bajnauth, D., Jarawan, E., Ahn, H., Li, G., Cai, Y., Yang, L., & Shen, J. (2022). Strengthening pandemic preparedness: Build the vaccine manufacturing capacity in low- and middle-income countries. Public health in practice (Oxford, England), 4, 100326. https://doi.org/10.1016/j.puhip.2022.100326 xxxiii ASEAN Leaders’ Declaration on ASEAN Vaccine Security and Self-Reliance (AVSSR) (Accessed January 26, 2023). https://asean.org/asean-leaders-declaration-on-asean-vaccine-security-and-self-reliance-avssr/ xxxiv Morand, S., Jittapalapong, S., Suputtamongkol, Y., Abdullah, M. T., & Huan, T. B. (2014). Infectious diseases and their outbreaks in Asia-Pacific: biodiversity and its regulation loss matter. PloS one, 9(2), e90032. https://doi.org/10.1371/journal.pone.0090032 xxxv Coker, R. J., Hunter, B. M., Rudge, J. W., Liverani, M., & Hanvoravongchai, P. (2011). Emerging infectious diseases in southeast Asia: regional challenges to control. Lancet (London, England), 377(9765), 599–609. https://doi.org/10.1016/S0140-6736(10)62004-1 35 Economic Analysis 4. As a part of the regional research study on vaccine development and manufacture, the World Bank commissioned the economic analysis to estimate the public health and economic benefits arising from such investments in AVSSR. The economic analysis specifically focused on investments in late-stage clinical trials for vaccine development, manufacture, and regulation. The investment case modeling builds on a previous study on investing in late-stage clinical trials and manufacturing of vaccines and therapeutics, which was published in The Lancet Global Health in July 2022.xxxvi This study has two key goals: (1) to model health and economic benefits that accrue to the ASEAN region for every dollar invested in vaccine trials, building manufacturing capacity, and augmenting national regulation systems, and (2) to estimate and document the benefits of a regional investment compared to a national approach, with a focus on domestic markets. The model assumes all ASEAN countries contain functional health systems that ensure efficient and equitable procurement and delivery of NIP and underutilized vaccines, as well as adequate demand for these vaccines from citizens. Methods and Data 5. Overview of modeling approach: The study assumes that five ASEAN countries—Indonesia, Malaysia, Philippines, Thailand, and Vietnam—already make public and private investments to strengthen vaccine securityxxxvii referred as the focus countries. Detailed analyses of strengths, weaknesses, opportunities, and threats (SWO ) of each focus country’s domestic vaccine capabilities are located in Tables 5.1 through 5.5 (Appendix 1). The economic analysis uses the profiles of the five focus countries to explore four different investment case scenarios. 6. The study focuses on five diseases: dengue, HPV, malaria, pneumococcal pneumonia, and TB, which were jointly prioritized with country experts from the five focus countries. In addition to these diseases, a pandemic outbreak scenario was included, which models the benefits of investing in the local production of vaccines during a pandemic similar to the magnitude of COVID-19.xxxviii Appendix 8 provides an overview of annual cases, disability-adjusted life years (DALYs), and deaths due to each disease in the ASEAN countries. 7. The study applies a societal perspective with all costs and benefits measured at the societal level. The societal perspective seeks to answer the question: How much would society benefit for each dollar invested in vaccine development and manufacture? In the study, the societal perspective assumes that the public sector (i.e., the governments of the five focus countries) covers all incurred costs. In general, the societal perspective also allows for investments from a larger group of investors, including from the private sector, however it does not make any assumptions about profits. Modeling a private investor’s perspective would require a different approach. The societal perspective is well aligned with the vision outlined in the ASEAN Leaders’ Declaration on AVSS . It is also in line with the World Bank’s policy dialogue with the five focus countries. Scenarios Modeled: Four investment case scenarios are modeled: 8. Investment case scenario 1. In the regional scenario, it is assumed that costs would be shared among the focus countries and that these countries would benefit from the vaccine development and manufacturing efforts. Specifically, the costs for R&D, tech transfer, regulation, and manufacturing would be shared by the five xxxvi Schäferhoff M, Zimmerman A et al. Investing in late-stage clinical trials and manufacturing of product candidates for five major infectious diseases: a modelling study of the benefits and costs of investment in three middle-income countries. Lancet Glob Health 2022; 10: e1045–52. xxxvii These five countries were pre-selected by the World Bank team. xxxviii We leverage the pandemic outbreak scenario to qualitatively discuss the benefits of investments in vaccine security for other pandemic-prone diseases, such as Avian Flu and SARS. 36 focus countries and all five countries (Indonesia, Malaysia, Philippines, Thailand, and Vietnam) would enjoy the health and economic benefits from their respective health systems procuring and delivering these vaccines. 9. Investment case scenario 2. In the ASEAN vaccine pooled purchasing scenario, the study shows the health and economic benefits that result when the other five ASEAN countries (Brunei, Cambodia, Lao PDR, Myanmar, and Singapore) purchase vaccines from focus countries while the focus countries continue to procure and distribute vaccines they produce to their own populations. This scenario assumes that vaccines would be purchased from ASEAN manufacturers as part of the ASEAN Free Trade Area (AFTA) rather than from producers in other regions. In case the global prices of these vaccines are lower, the non-focus countries should be willing to pay higher prices or middle- to high-income countries in the region may collectively offer cross subsides to LMICs. Again, in this scenario, the costs for R&D, tech transfer, and manufacturing would be covered by the five focus countries. However, the public health and economic benefits would accrue from a wider market (i.e., all 10 ASEAN countries). 10. Investment case scenario 3. In the national scenario, it is assumed that one country would only produce vaccines prioritized for its own market. One of the five focus countries with a median population (~100 million) was selected, and referred to as “country X.” The national scenario assumes that the costs for R&D, tech transfer, and manufacturing would be covered by one country only. At the same time, the public health and economic benefits would only accrue from one market (i.e., the domestic market of the country). 11. Investment case scenario 4. In the pandemic outbreak scenario, the study shows the benefits of investing in vaccine manufacturing in a pandemic outbreak situation. This scenario is equivalent to the regional scenario, but now includes a pandemic outbreak equal in magnitude to the 2021 COVID-19 pandemic. Here, it is assumed the 2021 incidence of COVID-19 across the five focus countries would continue for three years before reaching an endemic phase in which the incidence of COVID-19 across the focus countries would drop to five million cases per year. A sub-analysis of this scenario was also conducted, in which the focus was only on the costs and benefits of investments in pandemic vaccines. More specifically, neither R&D, nor manufacturing investments for the other diseases (i.e., dengue, HPV, malaria, pneumonia, and TB), nor economic or health benefits from these diseases were included. The sub-analysis also assumed no investment in regulation. 12. In addition to the four investment case scenarios above, five sensitivity scenarios were undertaken to account for uncertainty in the parameter estimates, and to estimate longer-term economic benefits. Model specifications are presented in Table 5.6 below, with detailed descriptions, equations, and data sources presented in Appendix 2. One scenario reduces total manufacturing costs by 25 percent (Appendix 3). This assumes that existing production capacity can be leveraged, while assessing direct financial gains that result from investments in clinical trial and manufacturing (treatment costs averted and vaccine sales). Another scenario (Appendix 4) includes economic productivity gains to capture the longer-term benefits of these investments. Another (Appendix 5) models investment case scenarios 1-4 using a five percent discount rate rather than the standard three percent rate to better reflect the economies of LMICs.xxxix In yet another (Appendix 6), investment case scenarios 1-4 were modeled using a lower phase III clinical trial cost to reflect potentially lower costs associated with R&D in the focus countries. Finally, to account for regulatory and market entry requirements that could delay distribution of vaccines to populations, investment case scenarios 1-4 were modeled under the assumption that vaccines will only be available to the public for two years (rather than one year) after launch from R&D pipeline (Appendix 7). xxxix Haacker, M., Hallett, T. B., & Atun, R. (2020). On discount rates for economic evaluations in global health. Health policy and planning, 35(1), 107–114. https://doi.org/10.1093/heapol/czz127 37 Table 5.6. Key model specifications Countries Indonesia, Malaysia, Philippines, Thailand, and Vietnam Diseases dengue, HPV, malaria, pneumonia, TB, and COVID-19 Time horizon 2022 to 2040 (19 years) R&D costs • Phase I, II, and III clinical trials are needed for TB. • Only phase III clinical trials are needed for dengue, HPV, malaria, pneumonia, and COVID- 19. • One clinical trial site needed per product candidate; each site incurs an operating cost during the time in which clinical trials are running. Manufacturing • 4 new fully integrated manufacturing sites (each with a capacity of 30 million doses per costs year), and 2 new fill and finish sites (each with a capacity of 30 million doses per year). • Under the national scenario, 1 fully integrated site and 1 fill and finish site each with 30 million doses per year capacity. • One-time construction costs and annual operating costs based on data shared by the IFC as well as the countries. Manufacturing sites are operational one year after investments are made. • One-time technology transfer cost will be incurred to manufacture vaccines for those diseases that have an effective vaccine available (HPV and pneumonia); and malaria and dengue vaccines will be available soon. Health benefits • Vaccination coverage increases by 10 percentage points per year up to a maximum of 80%. • Annual reductions in incidence are the product of disease incidence, vaccination coverage, and vaccine efficacy. • The cases, deaths, and disability-adjusted life years averted by the introduction of vaccines into the population were estimated. Economic • Treatment costs averted are the product of cases averted, treatment coverage, and benefits treatment cost per case. • Treatment coverage data was collected from WHO and other sources or shared by countries. If data was unavailable, treatment coverage levels of 50% was assumed. • Treatment costs per case of each disease are based on averages shared by the five focus countries. Discount rate • A discount rate of 3.0% was used for all monetary costs and benefits. Results Investment Case Scenario 1: Regional scenario 13. Under the regional scenario, the development and manufacturing of vaccines would cost a total of US$2.7 billion, while the net benefits would amount to US$82.3 billion. As such, the BCR amounts to 30.88 (Table 5.7). Under this scenario cumulative benefits exceed cumulative costs beginning in year 5 (2026) of the time horizon. See Table 5.8 for more details on the costs. Table 5.7. Regional scenario – total costs, benefits, and benefit-cost ratio (BCR) Total costs (2022 USD millions)* $2,664.86 Net benefits (2022 USD millions)** $82,285.18 BCR*** 30.88 Threshold**** Year 5 *Regulation, clinical trials, tech transfer, and manufacturing costs. **Treatment costs averted. ***Net benefits/total costs. ****Year in which cumulative economic benefits exceed total costs. 38 Table 5.8. Regional scenario - clinical trial, manufacturing, and regulation costs Clinical trial costs (2022 USD millions) Phase I trial costs $4.58 Phase II trial costs $39.47 Phase III trial costs* $532.85 Clinical trial site operational costs $3.16 Manufacturing costs (2022 USD millions) Site construction costs $1,013.59 Site operational costs $612.88 Tech transfer costs $77.67 Regulation costs (2022 USD millions) IDP investments $380.66 *Includes pilot project costs. 14. Through the vaccines developed and produced in the region, a total of 194.71 million cases, 0.93 million deaths, and 22.80 million DALYs would be prevented under the regional scenario (Table 5.9). Table 5.9. Regional scenario - health benefits Cases averted (millions) 194.71 Deaths averted (millions) 0.93 DALYs averted (millions) 22.80 DALYs averted as a percent of baseline DALYs 21.3% Investment Case Scenario 2: ASEAN vaccine pooled purchasing scenario 15. Under the ASEAN vaccine purchasing scenario, the BCR is 35.09. The BCR is higher compared to scenario 1 for two reasons: First, the vaccines are sold by the five focus countries, which generates an additional benefit. Second, the treatment costs averted across all ASEAN countries is larger than in scenario 1. See Tables 5.10 and 5.11 for details on the costs and economic benefits. Under this scenario cumulative benefits exceed cumulative costs beginning in year 5 (2026) of the time horizon. Table 5.10. ASEAN vaccine purchasing scenario - total costs, benefits, and benefit-cost ratio (BCR) Total costs (2022 USD millions)* $2,664.86 Net benefits (2022 USD millions)** $93,510.27 BCR*** 35.09 Threshold**** Year 5 *Regulation, clinical trials, tech transfer, and manufacturing costs. **Treatment costs averted and vaccines sold. ***Net benefits/total costs. ****Year in which cumulative economic benefits exceed total costs. 39 Table 5.11. ASEAN vaccine purchasing scenario - clinical trial, manufacturing, and regulation costs Clinical trial costs (2022 USD millions) Phase I trial costs $4.58 Phase II trial costs $39.47 Phase III trial costs* $532.85 Clinical trial site operational costs $3.16 Manufacturing costs (2022 USD millions ) Site construction costs $1,013.59 Site operational costs $612.88 Tech transfer costs $77.67 Regulation costs (2022 USD millions ) IDP investments $380.66 *Includes pilot project costs. 16. A total of 219.98 million cases, 1.06 million deaths, and 25.96 million DALYs would be averted in the ASEAN regions (Table 5.12). Table 5.12. ASEAN vaccine purchasing scenario - health benefits Cases averted (millions) 219.98 Deaths averted (millions) 1.06 DALYs averted (millions) 25.96 DALYs averted as a percent of baseline DALYs 21.2% Investment Case Scenario 3: National scenario 17. Under the national scenario, the BCR is 9.51, a significantly smaller economic return compared with the regional scenarios above (Scenarios 1 and 2). In addition, cumulative benefits do not exceed cumulative costs in this scenario until year 7 (2028) of the time horizon. See Tables 5.13 and 5.14 below. Table 5.13. National scenario - total costs, benefits, and benefit-cost ratio (BCR) Total costs (2022 USD millions)* $1,245.58 Net benefits (2022 USD millions)** $11,841.53 BCR*** 9.51 Threshold**** Year 7 *Regulation, clinical trials, tech transfer, and manufacturing costs. **Treatment costs averted. ***Net benefits/total costs. ****Year in which cumulative economic benefits exceed total costs. 40 Table 5.14. National scenario - clinical trials and manufacturing costs Clinical trial costs (2022 USD millions) Phase I trial costs $4.58 Phase II trial costs $39.47 Phase III trial costs* $532.85 Clinical trial site operational costs $3.16 Manufacturing costs (2022 USD millions) Site construction costs $288.35 Site operational costs $172.62 Tech transfer costs $77.67 Regulation costs (2022 USD millions) IDP investments $126.89 *Includes pilot project costs . 18. The number of averted deaths amount to 0.14 million and DALYs to 3.58 million. A total of 26.78 million cases would be averted (Table 5.15). Table 5.15. National scenario - health benefits Cases averted (millions) 26.78 Deaths averted (millions) 0.14 DALYs averted (millions) 3.58 DALYs averted as a percent of baseline DALYs 20.8% Investment Case Scenario 4: Pandemic outbreak scenario 19. Under the pandemic outbreak scenario, the development and manufacturing of vaccines would cost a total of US$3.2 billion, while the net benefits would amount to US$90.6 billion. As such, the BCR amounts to 28.27. Under this scenario cumulative benefits exceed cumulative costs beginning in year 3 (2024) of the time horizon, as detailed in Tables 5.16 and 5.17. Table 5.16. Pandemic scenario - total costs, benefits, and benefit-cost ratio (BCR) Total costs (2022 USD millions)* $3,205.50 Net benefits (2022 USD millions)** $90,605 BCR*** 28.27 Threshold**** Year 3 *Regulation, clinical trials, tech transfer, and manufacturing costs. **Treatment costs averted. ***Net benefits/total costs. ****Year in which cumulative economic benefits exceed total costs. 41 Table 5.17. Pandemic scenario - clinical trials and manufacturing costs Clinical trial costs (2022 USD millions) Phase I trial costs $4.58 Phase II trial costs $39.47 Phase III trial costs* $651.50 Clinical trial site operational costs $3.47 Manufacturing costs (2022 USD millions ) Site construction costs $1,063.59 Site operational costs $612.88 Tech transfer costs $97.09 Regulation costs (2022 USD millions ) IDP investments $380.66 *Includes pilot project costs. 20. Under the pandemic outbreak scenario 243.57 million cases, 1.70 million deaths, and 53.49 million DALYs would be prevented, as indicated in Table 5.18. Table 5.18. Pandemic scenario - health benefits Cases averted (millions) 256.39 Deaths averted (millions) 1.90 DALYs averted (millions) 61.54 DALYs averted as a percent of baseline DALYs 15.8% 21. For the pandemic scenario sub-analysis, only COVID-19 specific costs and benefits were modeled assuming an outbreak of similar magnitude. R&D or manufacturing investments for the other diseases (i.e., dengue, HPV, malaria, pneumonia, and TB) nor economic or health benefits from these diseases were included in the model. Under this scenario it was assumed that investments for one phase III trial of a COVID-19 vaccine, one mRNA vaccine manufacturing facility, and technology transfer. Investments in regulation are not included in this scenario. With these modifications, the development and manufacturing of vaccines would cost US$540.64 million, the net benefits would amount to US$31.9 billion, the BCR would be 58.9, and cumulative economic benefits would exceed total costs by the end of year 1 (Tables 5.19-5.21). Table 5.19. Pandemic outbreak scenario (sub-analysis) – COVID-19 specific costs, benefits, and benefit-cost ratio (BCR) Total costs (2022 USD millions)* $540.64 Net benefits (2022 USD millions)** $31,873 BCR*** 58.9 Threshold**** 2022 (year 1) *Clinical trials, tech transfer, and manufacturing costs. **Treatment costs averted. ***Net benefits/total costs. ****Year in which cumulative economic benefits exceed total costs. 42 Table 5.20. Pandemic outbreak scenario (sub-analysis) – COVID-19 specific clinical trial and manufacturing costs Clinical trial costs (2022 USD millions) Phase I trial costs $0.00 Phase II trial costs $0.00 Phase III trial costs $118.65 Clinical trial site operational costs $0.31 Manufacturing costs (2022 USD millions) Site construction costs $268.45 Site operational costs $133.82 Tech transfer costs $19.42 Regulation costs (2022 USD millions) IDP investments $0.00 Table 5.21. Pandemic outbreak scenario (sub-analysis) – COVID-19 specific health benefits Cases averted (millions) 60.7 Deaths averted (millions) 0.97 DALYs averted (millions) 38.74 DALYs averted as a percent of baseline DALYs 13.69 % Limitations 22. There are important limitations to consider when interpreting the results of this analysis. First, it is important to note that while this economic analysis focuses only investments on late-stage clinical trials, manufacturing and regulation capacity for estimating costs, robust health systems driven by strong policies and adequate financing with personnel, infrastructure and supply chains for demand generation, and last mile delivery will be required for translating benefits of these investments to citizens efficiently and equitably. Second, the estimates of costs and benefits include only a limited set of vaccines for dengue, HPV, malaria, pneumonia, TB, and COVID- 19. Investments in manufacturing and regulation capacity could potentially improve vaccine access for a wider range of infectious diseases thereby further increasing economic and health returns beyond what is modeled in this study. Third, it is assumed that phase III clinical trials require at least two years to complete and that vaccines enter the market and become available to the public one year after completion of phase III trials. The COVID-19 pandemic has shown that new vaccine platforms using plug and play technologies, adaptive clinical trial designs and regulatory efficiencies can substantially reduce the time from initiation of phase III clinical trials to market approval to under one year. The results may therefore overestimate the time needed for new vaccines to enter the market, and thus underestimate economic and health benefits accrued to the population. Fourth, the study only estimates the economic and health benefits of increased vaccination coverage within ASEAN. However, with increased vaccine production and regulation capacity, ASEAN countries may sell their vaccines to other regions, provided their prices are competitive in international markets or they may be able to produce vaccines for neglected tropical diseases in which major international manufacturers have low interest, thereby increasing the economic and health benefits of the investments modeled in this study. Fifth, except for the costs to strengthen national regulatory capacity, costs needed before entering the clinical stage (i.e., costs for basic research and related scientific infrastructure, such as laboratories) are not included. These costs are difficult to determine. Lastly, developing regional vaccine manufacturing capabilities is an important step towards achieving vaccine security and self-reliance. However, it requires several other elements and actors both within and outside health systems to realize the AVSSR vision. 43 Discussion 23. The economic analysis provides new evidence on the health benefits and the economic returns of investing in late-stage clinical trials, vaccine manufacture and regulatory capacity development by focus ASEAN countries. It shows that investments in trials and manufacturing would have a substantial public health impact provided the health system is adequately financed and has necessary inputs to efficiently deliver the vaccines included in the analysis. The study suggests that under the regional scenario, product development and manufacturing in the five focus countries could avert a total of 194.71 million cases and 93 million deaths over a 19-year timeframe. In addition, 22.80 million or 21.3 percent of all DALYs from dengue, HPV, malaria, pneumonia, and TB would be prevented through the tools developed and produced in the region. While public health gains under the vaccine purchase scenario would be even higher, they would be more limited under the national scenario which only covers the population of one country. While broad trends of this analysis in terms of benefits remain highly relevant, the BCRs tend to be more optimistic due to non-inclusion of full gamut of health systems costs required to deliver vaccines such as human resources, cold chain, information systems, demand generation, and adverse event monitoring. 24. The results also show that investing in clinical trials and local production pays off from an economic perspective. Economic returns would be especially high if new vaccines were produced for multiple markets rather than for domestic markets only. Under the regional scenario, returns outweigh investments by a factor of 31, and by a factor of 35 under the vaccine purchase scenario. These returns are substantial, even though the direct economic benefits and limited the vaccine purchase scenario to the ASEAN countries were included. If the ASEAN manufacturers can offer competitive prices, their vaccines could be sold beyond AFTA, and the returns would even be higher. In addition, the longer-term indirect benefits are estimated (see Appendix 4 on productivity gains). The BCRs of the regional scenario and the vaccine purchasing scenario increase to 40 and 46, respectively. These results correspond with findings from the larger health economics literature, which shows that vaccinations are among the most cost-effective public health interventions,xl,xli,xlii,xliii with a high return on investmentxliv,xlv,xlvi and broad economic benefits.xlvii,xlviii,xlix 25. However, the BCR is substantially different if only domestic markets are targeted. In the national scenario, the BCR is 9.51, a significantly smaller economic return compared with the regional scenario and the regional xl Bloom DE. The Value of Vaccination. In: Curtis N, Finn A, Pollard AJ, eds. Hot Topics in Infection and Immunity in Children VII. New York, NY: Springer New York, 2011: 1 –8. xli Zeng Y, Luo M, Chen J, et al. An economic evaluation of the current measles vaccination program: A case study in Zhejiang Province, east China. Vaccine 2019; 37: 3071–7. xlii Jeuland M, Cook J, Poulos C, Clemens J, Whittington D. Cost-Effectiveness of New-Generation Oral Cholera Vaccines: A Multisite Analysis. Value Health 2009; 12: 899–908. xliii Lusvan M-E, Debellut F, Clark A, et al. Projected impact, cost-effectiveness, and budget implications of rotavirus vaccination in Mongolia. Vaccine 2019; 37: 798–807. xliv Sarker AR, Sultana M, Mahumud RA, Van Der Meer R, Morton A. Cost-effectiveness analysis of introducing universal childhood rotavirus vaccination in Bangladesh. Hum Vaccines Immunother 2018; 14: 189–98. xlv Pindyck T, Tate JE, Parashar UD. A decade of experience with rotavirus vaccination in the United States – vaccine uptake, effectiveness, and impact. Expert Rev Vaccines 2018; 17: 593–606. xlvi Rodrigues CMC, Plotkin SA. Impact of Vaccines; Health, Economic and Social Perspectives. Front Microbiol 2020; 11: 1526. xlvii Quilici S, Smith R, Signorelli C. Role of vaccination in economic growth. J Mark Access Health Policy 2015; 3: 27044. xlviii Nandi A, Shet A. Why vaccines matter: understanding the broader health, economic, and child development benefits of routine vaccination. Hum Vaccines Immunother 2020; 16: 1900–4. xlix Rémy V, Largeron N, Quilici S, Carroll S. The economic value of vaccination: why prevention is wealth. J Mark Access Health Policy 2015; 3: 29284. 44 pooled procurement scenarios. In addition, cumulative benefits do not exceed cumulative costs in this scenario until year 7 of the time horizon. In the regional scenario and the vaccine purchasing scenarios, it would only take 5 years before the benefits outweigh the costs. The study therefore supports regional action for clinical trials and product manufacturing compared to narrow national efforts. Developing and producing vaccines for a larger group of countries is favorable compared to narrowly targeting domestic markets. 26. The findings are fully in line with the AVSSR Strategic and Action Plan 2021-2025,l which discusses the economic and heath security setbacks from COVID-19, and the need for stronger regional vaccine manufacturing capacity and human resource development to realize the goal of self-reliance. In addition, the results are coherent with previous work on clinical trials and manufacturing capacity in India, Kenya, and South Africa from 2021 to 2036 for five diseases—HIV, TB, malaria, pneumonia, and diarrheal diseases.li In the previous study, it was found these investments have substantial public health impacts and economic returns, especially if products are produced for regional markets rather than for domestic markets only. However, as highlighted in previous work, ASEAN member state governments should commit to long-term purchase contracts (advanced market commitments; AMCs) for vaccine development and manufacture in the region. This upfront commitment is critical to attract investments – both public and private – to ensure that vaccines are developed and produced in a reliable and sustainable way. 27. The pandemic scenario also shows the health and economic benefits of investing in regional vaccine manufacturing capacity. Under the pandemic scenario 256.39 million cases, 1.90 million deaths, and 61.54 million DALYs would be prevented with a BCR of 28.27. Investments in local manufacturing will contribute to pandemic preparedness and strengthening the response to future outbreaks. The COVID-19 pandemic has shown that many LMICs fully or to a large extent rely on external support. Limited vaccine manufacturing capacity is one of the main factors driving COVID-19 vaccine inequity, and is one of the most pressing issues for future pandemic preparedness and response. A key lesson from the COVID-19 pandemic is to increase and geographically diversify vaccine manufacturing. Investments in trial sites and manufacturing capacity would enable ASEAN countries to leverage their own research, product development, and manufacturing capacity in times of health crisis rather than relying on external support, as well as help to reduce the burden of priority neglected tropical diseases in the region. Investing in building capacity for trials and manufacturing would enable MICs to react faster and more effectively to outbreaks. 28. The pandemic scenario also highlights the health and economic gains that could arise from investments to curtail future pandemics from other infectious diseases. For example, given that avian flu has a higher case- fatality rate than COVID-19,lii investments in vaccine manufacturing capacity for this disease could result in higher health and economic savings than what is seen in the pandemic scenario assuming an avian flu pandemic similar in magnitude to the COVID-19 pandemic. 29. Investments in vaccine research and manufacture have many other benefits. Investments in trial sites and manufacturing will be useful for a much broader range of infectious and non-communicable diseases, as well as for the development and production of other medical countermeasures such as therapeutics and diagnostics. Improved regulatory capacity will have an impact on the quality of all locally produced medicines. Lower prices and better quality of locally produced medicines will help mitigate health inequalities within and across l ASEAN Vaccine Network Consultation Meeting. About. 2022. https://aseanvaccinenetwork.com/about. li Schäferhoff M, Zimmerman A, Diab MM, et al. Investing in late-stage clinical trials and manufacturing of product candidates for five major infectious diseases: a modelling study of the benefits and costs of investment in three middle- income countries. Lancet Glob Health 2022; 10: e1045–52. lii Poovorawan, Y., Pyungporn, S., Prachayangprecha, S., & Makkoch, J. (2013). Global alert to avian influenza virus infection: from H5N1 to H7N9. Pathogens and global health, 107(5), 217–223. https://doi.org/10.1179/2047773213Y.0000000103 45 countries. Vaccinations have multiple other socioeconomic and other benefits throughout health systems (see Appendix 10). 30. Vaccine development and manufacture is an affordable investment, with small fiscal implications. The total costs for late-stage clinical trials, manufacture, and regulatory strengthening only represent a very small percentage of domestic general government health expenditure (GGHE-D) of ASEAN countries (Appendix 11). Over 19 years, the focus countries would have to invest three percent of their combined health expenditures. In addition, the threshold analysis shows that it will take five years before the economic gains exceed total costs. This is a short time horizon. 31. Going forward, countries should jointly invest in vaccine research and manufacture as an important regional public good. Governments should create an enabling environment for private sector investment through long- term purchase contracts. Initially, it may also require a commitment by those ASEAN countries to pay a higher price compared to established producers from other regions. However, over the medium term such investments will help to establish a strong regional eco-system for vaccine security, with substantial health and economic benefits. At the 2023 World Economic Forum, Larry Summers, former US Treasury Secretary and former Chief Economist of the World Bank, emphasized that another “COVID-scale problem” within the ne t years is a top economic risk and that the world continues to be utterly unprepared for that eventuality.liii ASEAN countries should prepare themselves through investments in vaccine security. In addition to financial investments in R&D and manufacturing, they should take targeted policy action, for example through stronger regional regulatory harmonization. liii https://www.cnbc.com/2023/01/20/covid-scale-problem-in-next-15-years-larry-summers-on-his-top-risks.html 46 Chapter 6: Way Forward 1. COVID-19 demonstrated that preparedness for future pandemics requires all regions of the world to be better coordinated and self-reliant in medical countermeasures, especially with vaccines. To minimize the effect of vaccine nationalism and achieve equitable vaccine access, ASEAN member states should agree on a realistic regional approach to identify and prioritize the low-hanging fruit of vaccine security, breaking measures down into smaller steps. The region could benefit from exploring new developments such as plug and play technologies in vaccine manufacture, and artificial intelligence in new vaccine and biological development. This will substantially reduce capital investments and provide more flexibility to use the same platforms for different vaccines and biologicals. 2. The findings and options arising from the study, as summarized in earlier chapters, were shared at a regional vaccine security consultative workshop the World Bank and IFC teams co-hosted with the MOH, Indonesia, and the ASEAN Secretariat in November 2022 in Bali, Indonesia. The workshop gathered about 150 key players representing the highest levels of ASEAN region governments, including senior policy makers and program managers from eight ASEAN countries, and more than 50 private ASEAN-based or ASEAN-affiliated companies. This provided an excellent platform to have a frank and open dialogue among regional stakeholders. 3. The regional leadership and private sector concluded that vaccine security to benefit the entire region revolves around a common vision and set of goals, and pledged to collaborate using best practices on behalf of their respective countries. A sustained political commitment, over the long term, with adequate financing is necessary for realizing AVSSR vision. Through action-focused discussions among stakeholders, participants determined the ASEAN region is ready to move from “acting locally and thinking regionally, to acting regionally.” 4. Key considerations were compiled to inform development of an eco-system based approach towards vaccine security at the regional level, including: • ASEAN nations share a common set of problems including gaps in regulatory capacity, qualified human resources, access to new technologies, and commercial sustainability of investments in vaccine manufacture. • Countries must leverage their comparative advantage on the vaccine value chain, from upstream investments to last mile and logistics investments, all in cooperation with the private sector. • ASEAN dependency on other countries for key ingredients for vaccine manufacture exacerbated the health and economic impacts of the COVID-19 experience. • ASEAN countries graduating from Gavi support (i.e., Cambodia, Lao PDR, and Myanmar) need adequate public financing to sustain their NIPs. There are substantial risks of vaccination rates for children regressing without addressing the financing gaps. • Vaccine R&D and manufacture are regional public goods that promote equity, address market failures, and strengthen economic and health systems resiliency. • An eco-system-based approach has a higher return on investment than independent country investments. This is pertinent given the high financial, specialized human resources, and technical investments needed for successful vaccine R&D and manufacture, and when considering comparative CBRs of large-scale clinical trials, vaccine manufacturing, and strengthening of NRAs. • Strong ownership and demand for technical and financial support from strategic partners advances regional cooperation to fully operationalize regional commitment to the AVSSR Declaration. 47 • Capitalizing on opportunities to coordinate investments across the vaccine value chain can strengthen regional regulatory capacity. • Newer plug and play platforms could help accelerate ongoing efforts to achieve vaccine self- sufficiency. Countries have taken different pathways to develop vaccine and biological markets, but all pathways require strong regulatory capacity and sound technical partnerships. ASEAN countries can learn from Singapore’s achievement of the highest maturity level in the sub-region. • Private sector participants express strong interest in cross-ASEAN country investing and cross-regional partnerships, appreciation for the importance of the IFC’s ability to realize non-financial value, and better understanding of private sector business strategies such as sharing upcoming investment plans. • Novel vaccine platforms offer new opportunities for ASEAN countries to address rapidly emerging burden of non-communicable diseases with ongoing demographic and epidemiological transitions. Novel vaccine platforms offer new opportunities for treating non-communicable diseases. COVID-19 unleashed progress made in vaccine development over past few decades in less than 18 months by bringing together scientific knowledge shortening timelines to deliver many previously unvalidated vaccine platforms. Such accelerated progress made in designing new vaccine platforms during COVID-19 pandemic opened new opportunities for developing jabs for rapidly emerging burden of cancers, cardiovascular diseases as well as rare autoimmune diseases. With adequate investments, the mRNA technology can usher into new era of personalized vaccines for treating cancers by selectively targeting specific mutations responsible for cancer growth. Same principles can be applied for cardiovascular diseases, autoimmune diseases as well as emerging infectious diseases. Similarly, protein-based vaccines could help in immune system to mount a stronger response. Moderna will be able to offer personalized cancer vaccines against multiple tumor types in next five years and US FDA granted vaccine breakthrough designation for this vaccine along with vaccine for Respiratory Syncytial virus. Pfizer has started late-stage clinical trials for mRNA-based influenza vaccine and in the process of developing other vaccines as well. With rapidly increasing burden of non-communicable diseases, the ASEAN member countries can ill afford to repeat the COVID-19 experience of waiting in the queue. It is now time for the ASEAN to seriously focus on investing in R&D and capacity building for these novel vaccine platforms. Prioritize low-hanging fruits 4. While the study findings and the stakeholder consultations highlight economic and social benefits of making regional investments in vaccine research, manufacture, and regulatory strengthening, it is important for the ASEAN member states to collectively identify and agree on a realistic regional approach building on the broad strategic directions laid out in the AVSSR declaration. This calls for breaking down the goal of vaccine security into smaller steps identifying and prioritizing low-hanging fruit based on mutual strengths of member states to realize the AVSSR vision. Defining clear medium targets that describe a successful vision can help with 48 monitoring progress and ensure mutual accountability of member states, the ASEAN Secretariat, and key partners. Potential low-hanging fruits are: a. Pooled procurement: A phased approach for moving towards pooled procurement was addressed at the AVSSR workshop in Bangkok March 28-30, 2018, and further reiterated during the Bali consultation. While it can take several years to establish a mature central contracting system that requires delegation of vaccine procurement to a regional entity, some achievable steps in the interim could significantly improve the purchasing power of ASEAN member states (Figure 6.1). An initial step could be a less comple “informed buying” mechanism that facilitates member countries sharing information about supplies while conducting procurement individually. This can be followed by better “coordinated informed buying” where member countries jointly undertake market research and share supplier information and “group contracting” where member countries jointly negotiate prices and select suppliers while conducting procurement individually. Informed buying and coordinated informed buying may have limited impact on vaccine prices but would foster collaboration to standardize vaccine specifications and licensing procedures, including the establishment of long-term procurement and financing mechanisms to promote private investments. It is possible to envision a group contracting mechanism for selected vaccines among ASEAN member states over the next five years. Figure 6.1. Phased approach for institutionalizing pooled procurement Coordinated Central • Countries share information about suppliers Informed Buying • Countries jointly negotiate prices and select suppliers Contracting • Conduct procurement individually • Countries undertake joint market • Agree to purchase from selected • Joint tendering and contract research and share supplier suppliers award through a regional entity performance and price • Conduct procurement individually • Central buying unit manages information purchase on behalf of all • Conduct procurement countries individually Group Informed Buying Contracting b. Regulatory harmonization: Ongoing regulatory harmonization efforts should give priority focus to vaccines and biologicals. A first step is to reach a shared understanding of the common technical dossier for vaccines across ASEAN regulators and to agree on collaborative procedures for authorization, including halal certification. The next step could be to improve the convergence of the assessment and issuance process of market authorization by strengthening the current JACG of the ACCSQ-PPWG. Twinning with the highest-rated Singapore NRA could be another step towards intra-regional learning and complementarity. 49 c. Regional human resource capacity building: It is clear from analysis and stakeholder feedback that human resources remain a critical bottleneck for expanding ASEAN vaccine development and manufacturing capacity. The first step to address this could be projecting HR demand over a 5- to 10- year period. Such a projection justifies investments in higher education and postgraduate training, which can be done in collaboration with the WHO mRNA hub, international technical partners such as IVI and CEPI, as well as private companies. Existing hubs can be leveraged as concentrations of expertise in distinct locations, which creates a gravitational effect attracting additional talent. However, ensuring regional equity is important for all countries to benefit from the collaborative effort. d. Regional platform for public-private dialogue: Communications with regional stakeholders from public and private sectors, along with findings of the value chain analysis clearly highlighted the importance of strengthening public-private sector dialogue and partnerships. The ASEAN Secretariat is well placed to create such mechanisms by building on existing frameworks for public-private collaboration. An established repository of incentives, innovations, and emerging lessons offered by ASEAN member countries to promote private sector investments in vaccine and biological manufacture would facilitate efficient and informed dialogue between public and private players. Way forward for stakeholders 6. To achieve successful regional vaccine security, leadership and participants must agree on overall strategy and individual responsibilities. A set of priority actions is proposed to ASEAN governments, ASEAN Secretariat, and The World Bank Group, drawing upon results from stakeholder consultations. Figure 6.2 presents concrete tasks to achieve shared goals to build a secure and sustainable vaccine eco-system in the ASEAN region. Figure 6.2. Suggested areas for prioritization by key stakeholders. ASEAN Governments ASEAN Secretariat The World Bank Group • Enhance public financing and or find innovative • Create a strong regional platform for AVSSR • Finalize and disseminate the regional report ways of enhancing private sector investments in implementation supported by competent and country case studies with key stakeholders vaccine R&D and manufacture. resource persons within the ASEAN Secretariat. and policy makers. • Create an enabling investment and level • Develop a regional Vaccine Management • Engage with economic and health clusters of playing policy environment for the private Information System to enable transparent and governments around the conclusions of country sector to complement public sector efficient information sharing. case studies, private sector landscape analyses, manufacturers, while public sector and economic analyses. manufacturers meet national obligations. • Introduce phased approach for regional pooled procurement mechanisms including demand • Support focused networking among private • Address HR limitations through building hands- estimation and coordinated negotiations. industry, academia, and government.​ on technical expertise in vaccine R&D and manufacture with employment and career • Create a regional stakeholder network to • Leverage WHO regional regulatory capacity- growth opportunities. promote sustained dialogue between public and building initiative and Singapore NRA to private sectors. facilitate knowledge exchange with other ASEAN • Sustain longer-term policy commitments to member states​. promote FDI in vaccine manufacture. • Promote regional regulatory harmonization for vaccines on a prioirty basis. • Support and strengthen institutional and • Ensure underserved populations receive equal regional interventions, including regulatory priority with regard to vaccine delivery • Facilitate regional HR capacity development harmonization, human resources for R&D and challenges. intiatives through WHO mRNA hub and manufacture of vaccines and biologicals, Singapore NRA. regionally-coordinated investments, and public- • Address gaps in eco-systems such as regulatory private partnerships. harmonization, data sharing on vaccine safety, harmonized schedules, and packaging. 50 APPENDICES Appendix 1: Focus Country SWOT Analyses of Domestic Vaccine System Table 5.1. Indonesia SWOT Analysis of Domestic Vaccine System Strong vaccine manufacturing infrastructure and extensive export experience. Largest population in ASEAN region with strong political will to sustain NIP and grow domestic pharmaceutical industry. Recent regulatory successes in support of domestic vaccine R&D and biological product ecosystem. Strengths Weaknesses ▪ Strong political will to financially sustain the NIP with ▪ Bureaucratic processes and a lack of transparency hamper minimal external support. implementation of strategic plan/resilience policy for ▪ PT Bio Farma, a government-owned vaccine domestic vaccine manufacturing. manufacturer, has extensive experience with upstream ▪ Domestic vaccine industry growth is primarily through and downstream vaccine production, distribution, and public sector investments. No specific incentives in place global exporting. to develop new domestic manufacturers, for example by ▪ NRA has reached WHO maturity level 3. offering concessional land or subsidized utilities. ▪ Large population, comprising 40 percent of ASEAN total. ▪ Limited government support for collaboration or investment in technology transfer from international partners. ▪ Limited specialized human resource capacity in upstream R&D, and no government strategy to create required infrastructure or capacitate the regulatory workforce. Opportunities Threats ▪ Expansion of NIP, with new vaccine introductions  Difficulty ensuring sustained financing for new vaccine planned or underway, which is expected to generate introductions. new demand.  Uncertainty of local governments’ commitment to ▪ Four new entrants into the vaccine manufacturing prioritizing immunization. field have pursued collaborative arrangements with  Financial and geographic constraints that impact vaccine external strategic partners to incorporate new distribution and delivery, including the need to improve vaccine platforms (i.e., mRNA) into R&D and cold-chain capacity in many provinces. manufacturing. ▪ Demonstrated government commitment to strengthen vaccine security, evidenced through the passage of laws and regulations aimed at domestic vaccine and pharmaceutical manufacturing industry growth. ▪ Broad support (incl. government, NRA, academia and industry) for expanding national capacity for R&D and manufacturing to broader ASEAN regional market. 51 Table 5.2. Malaysia SWOT Analysis of Domestic Vaccine System Strong government commitment to achieve self-sufficiency in vaccine production. Collaborative relationships fostered to enhance buy-in and provide stewardship for system development. Established fill and finish capacity, but lacking full-spectrum of critical inputs required for domestic vaccine manufacturing. Strengths Weaknesses ▪ Evidence of government prioritization of vaccine security ▪ Lack of sufficient upfront investment by government in and self-sufficiency through launching of National Vaccine vaccine R&D and manufacturing facilities. Development Roadmap (NVDR) and providing dedicated ▪ Inadequate access to raw materials needed for vaccine funding for Malaysia Genome and Vaccine Institute. R&D and manufacture, and limited collaboration with ▪ Established consortium of vaccine R&D experts, which foreign companies around technology transfer. includes representatives from public and private sectors. ▪ Domestic pharmaceutical companies lack experience with ▪ Ability to build partnerships as demonstrated by selection full-spectrum human vaccine manufacturing. of Solution Biologics to be ASEAN manufacturing hub for CanSino COVID-19 vaccine. ▪ Three pharmaceutical companies have established human vaccine fill and finish capacity. Opportunities Threats ▪ Broad multisectoral support for vaccine security and  Insufficient focus or investment in bringing NRA to NVDR agenda. maturity level 3. ▪ Domestic pharmaceutical manufacturing companies  Small domestic market size discourages industry from DuoPharma and Pharmaniaga have already made investing, as the return on investment is prohibitively long investments and shown readiness to increase unless export opportunities evolve. manufacturing capacity. ▪ Enhanced government incentives to attract private investment in manufacturing of pharmaceutical products, including vaccines. Table 5.3. Philippines SWOT Analysis of Domestic Vaccine System Extensive experience in human clinical trials sponsored by global vaccine manufacturing companies. Large population and birth cohort. No domestic vaccine manufacturing capacity at present. Strengths Weaknesses ▪ Government commitment to NIP in terms of annual ▪ Lack of long-term market guarantee for investors, as NIP budget allocation. budgeting is done on an annual basis. ▪ Expertise in vaccine clinical trials among workforce in ▪ The NRA has not reached maturity level 3, and significant public and private institutions. government financing and support is needed to achieve ▪ Established regulatory and ethical processes for conduct this standard. of human clinical trials that meet good clinical practice ▪ Limited domestic technical expertise in GMP-related standards. processes and procedures. ▪ Large population size and growth rate, which can create domestic market. Opportunities Threats ▪ Strong political will of the new administration to grow  Reluctance of private pharmaceutical and vaccine vaccine manufacturing capacity through the cultivation of manufacturing industry to make domestic investments public-private partnerships and the dedication of funds due to higher labor costs and bureaucracy related to for a national R&D facility. business transactions. ▪ Established relationships between domestic researchers  Constraints related to geography and vaccine hesitancy and manufacturing companies which facilitates limit vaccine distribution. opportunities for hands-on training and biological transfers. ▪ Approved budget for improvement of Philippines FDA vaccine testing laboratory. ▪ Presence of strong private sector partners to promote vaccine distribution and complement vaccine manufacturing with supply chain industries. 52 Table 5.4. Thailand SWOT Analysis of Domestic Vaccine System Established vaccine R&D and manufacturing capacity. Strong collaboration between public and private sector in vaccine R&D. Domestic production mainly for export market with most NIP vaccines imported. Regional manufacturing hub (Siam Bioscience) for AstraZeneca COVID-19 vaccine. Strengths Weaknesses ▪ Scientific and research community within universities ▪ Limited upstream and full-spectrum vaccine production well-versed in vaccine R&D, with strong collaborative capacity. relationships between public and private institutions to ▪ Private sector manufacturing is mainly for export and support R&D efforts. private sector purchase; public sector manufacturers ▪ Established domestic vaccine manufacturers active in produce some vaccines used in NIP (i.e., BGC, influenza), vaccine R&D, with research agenda primarily focused on but most NIP vaccines are imported. vaccines for pandemic and tropical diseases. ▪ Disproportionate concentration of vaccine R&D projects ▪ NRA has achieved WHO maturity level 3. for COVID-19 at the expense of endemic and/or neglected ▪ Domestic capacity to produce novel vaccines tropical diseases. (recombinant acellular pertussis and COVID-19 subunit) as ▪ Limited dialogue between government, vaccine well as WHO pre-qualified vaccine (JE LAV). manufacturers, universities, and other stakeholders to ▪ Country-based Siam Bioscience is regional manufacturing develop a plan for building HR capacity and estimate hub for AstraZeneca COVID-19 vaccine. short- and long-term human resource needs related to national vaccine security agenda. Opportunities Threats ▪ Strong government commitment to national vaccine  Current human resource and financial investment in NRA security agenda in place since 2018 to grow the domestic is insufficient to keep up with new and more sophisticated vaccine industry from R&D to production and marketing. vaccines and technologies. ▪ NVI provides stewardship for domestic vaccine R&D and  Bureaucratic processes and a lack of transparency have manufacture, including clinical trials, and is a strong player eroded private sector trust in government-led initiatives. regionally in coordinating the vaccine security agenda in ASEAN region. ▪ Global recognition as leader in public health research and health system management. Table 5.5. Vietnam SWOT Analysis of Domestic Vaccine System Considerable experience with vaccine R&D and manufacture. Domestic manufacturing industry produces sufficient supply to meet domestic vaccine requirements, but lacks export capabilities. Government has prioritized vaccine security, but funding and support to enhance infrastructure and establish partnerships for technology transfer are limited. Strengths Weaknesses ▪ NRA has reached WHO maturity level 3. ▪ Equipment in state-owned facilities is outdated due to ▪ Decades of experience with vaccine R&D and chronic underinvestment. manufacturing and institutional knowledge of the vaccine ▪ Human resources lack skills to develop and manufacture industry. new vaccines using modern technologies. ▪ State-owned manufacturers produce 14 types of vaccines ▪ High cost of maintaining GMP status among state-owned compliant with WHO GMP requirements. manufacturers. ▪ Local manufacturing sufficient to meet domestic vaccine requirements. Opportunities Threats ▪ Two private vaccine manufacturers are expanding vaccine  Lack of clear and comprehensive strategy for vaccine eco- production capacity using modern technologies (i.e., system development, which impacts short- and long-term protein subunit, mRNA for COVID-19 vaccines), and may investments in skill building/training for staff, R&D, and expand into other vaccine lines in the future. facility modernization. ▪ Stated government commitment to prioritize vaccine  Limited revenue generation by public sector security, improve vaccine quality control, and develop manufacturers due to outdated pricing structure. vaccines for existing or future pandemics. 53 Appendix 2: Model Specification and Equations with Data Sources 1. Model Specifications: The analysis assumes a societal perspective, examining the benefits and costs of investments in vaccine R&D, technology transfer, manufacturing, and regulation across the five focus countries (Scenario 1). A time horizon of 19 years from 2022 to 2040 was assumed. 2. With respect to R&D costs, early and late-stage R&D (phase I, II, and III clinical trials) is assumed to be needed for those diseases which do not currently have a vaccine, or which have a vaccine with low effectiveness (TB). For those diseases with vaccines already in later stages of the R&D pipeline (dengue and forthcoming malaria vaccines), there is an assumed need for one additional phase III clinical trial.liv For those vaccines that have been on the market for a long time and have proven safety for use (HPV and pneumonia), it is assumed that there is no need for phase III trials but rather a need for one smaller study (“vaccination pilot project”) per disease. The five focus countries therefore incur the cost of phase I, II, and III clinical trials as well as clinical trial site operating costs and vaccination pilot projects where relevant. The number of phase I, II, and III clinical trials required to launch one new vaccine for each disease as well as the costs and duration of each phase is based on data from the portfolio-to-impact (P2I) tool.lv,lvi It was also assumed one clinical trial site is needed per product candidate, and that each site incurs an operating cost during the time in which clinical trials are running. The annual operating cost is based on information shared by the countries. The cost of a vaccine pilot project is assumed to be one- fourth the cost of a phase III clinical trial. 3. In terms of manufacturing costs, it was assumed the five focus countries together will build four new fully integrated manufacturing sites (each with a capacity of 30 million doses per year) and two new fill and finish sites (each with a capacity of 30 million doses per year). This assumption was changed for the national scenario (Scenario 3). Under this scenario, the manufacturing requirement is limited only to one fully integrated and one fill and finish site based on the minimum capacity needed to address the disease burden in the selected country. This assumption was also changed for the pandemic outbreak scenario. Under this scenario it is assumed that all the four fully integrated manufacturing sites would be dedicated for mRNA vaccine production. For the pandemic outbreak scenario sub-analysis, it is assumed the five focus countries would only build one mRNA vaccine manufacturing site instead of four fully integrated and two fill/finish sites. Overall, the focus countries therefore incur construction and annual operating costs associated with each new site. One-time construction costs and annual operating costs are based on data shared by the IFC as well as the countries. The model currently assumes new manufacturing sites are operational one year after investments are made. The model also assumes that a one-time technology transfer cost will be incurred by the five focus countries to manufacture vaccines for those disease which already have an effective/WHO endorsed vaccine available (malaria, dengue, HPV, pneumonia, and COVID-19). 4. In terms of regulation costs, it was assumed that it was assumed that three of the five focus countries make annual investments in their NRAs amounting to US$8.86 million per country per year. These investments were drawn from resource need identified by respective institutional development plans (IDP) to strengthen national regulatory capacity. For the pandemic scenario sub-analysis, we assume no investment in regulation. 54 5. Regarding the health benefits, it was assumed that vaccines will be available to the public one year after launch from the R&D pipeline and vaccination coverage increases by 10 percentage points per year with a maximum attainment of 80 percent coverage for each vaccine. Reductions in incidence are therefore the product of disease incidence, vaccination coverage, and vaccine efficacy. Using these assumptions, the cases, deaths, and DALYs averted by the introduction of vaccines among the population was modeled. Annual incidence data is based on information from the Institute for Health Metrics and Evaluation (IHME). Case fatality rates, years lived with disability (YLD) per case of disease, and years of life lost (YLL) per case of disease that results in death are based on data collected through literature reviews. 6. Regarding the economic benefits, treatment costs averted were estimated as the product of cases averted, treatment coverage, and treatment cost per case. With exception to specific data from the five focus countries received or found relevant data through literature reviews, it was assumed treatment coverage levels of 50 percent for all diseases and across all countries. Treatment costs per case of each disease are based on information on averages obtained by the five focus countries. For Scenario 2, vaccine purchases as an additional economic benefit (resulting from sold vaccines beyond the five focus countries) was included.lvii For Scenario 4, the COVID-19 pandemic scenario, COVID-19 treatment costs averted were based on the proportion of cases that require outpatient care vs. inpatient care. In addition, inpatient costs were stratified by those with mild symptoms, those who require oxygen, those who require ventilation, and those who require extracorporeal membrane oxygenation. As highlighted above, Appendix 4 includes a sensitive analysis for each scenario that captures the longer-term benefits resulting from increased economic productivity. A discount rate of three percent was used for all monetary costs and benefits. For each scenario a threshold analysis was conducted to estimate the year by which cumulative economic benefits would exceed the total costs of investment. All model equations are detailed below, followed by a summary of the main model parameters. Model Equations: Average years of life lost per death. ∑ ( ∗ ) = =1 Equation 1 Where YLL is the average years of life lost per death, a is age group, D is number of deaths per year, and L is life expectancy. Average years lived with disability per non-treated case. ∑ ( ∗ ∗) = =1 Equation 2 Where YLD is the average years lived with disability per non-treated case, a is age group, I is annual incidence, T is disease duration without treatment expressed in years, DW is the disability weight. Average years lived with disability per treated case ∑ ( ∗ ∗) = =1 Equation 3 Where YLD is the average years lived with disability per non-treated case, a is age group, I is annual incidence, T is disease duration with treatment expressed in years, DW is the disability weight. 55 Number of cases averted = ∑ =1 ∑=1(, − , ) Equation 4 Where N is the number of cases averted, i is the disease, x is the year, IB is the baseline incidence of disease, and IV is the incidence of disease with a new vaccine. Number of deaths averted = ∑ =1 ∑=1[(, ∗ (1 − , ) ∗ ) + (, ∗ (, ) ∗ )] − [(, ∗ (1 − , ) ∗ ) + (, ∗ (, ) ∗ )] Equation 5 Where N is the number of deaths averted, i is the disease, x is the year, IB is the baseline incidence, CB is the baseline treatment coverage, CFR is the case fatality rate without treatment, CFRT is the case fatality rate with treatment, and IV is the incidence with a new vaccine. Number of years of life lost averted = ∑ =1 ∑=1(, ∗ − , ∗ ) Equation 6 Where N is the number of years of life lost averted, i is the disease, x is the year, DB is the baseline number of deaths, YLL is the average years of life lost per death, and DT is the number of deaths with a new vaccine. Number of years lived with disability averted = ∑ =1 ∑=1[(, ∗ (1 − , ) ∗ ) + (, ∗ (, ) ∗ )] − [(, ∗ (1 − , ) ∗ ) + (, ∗ (, ) ∗ )] Equation 7 Where N is the number of years lived with disability averted, i is the disease, x is the year, IB is the baseline incidence, CB is the baseline treatment coverage, YLD is the average number of years lived with disability per non-treated case, YLDT is the average number of years lived with disability per treated case, and IV is the incidence with a new vaccine. Number of disability adjusted life years averted = ∑ =1 ∑=1(, + , ) Equation 8 Where N is the number of disability adjusted life years averted, i is the disease, x is the year, YLL is the number of years of life lost averted, and YLD is the number of years of life lived with disability averted. Treatment costs averted = ∑ =1 ∑=1(, ∗ , ∗ , ) Equation 9 Where C is treatment costs averted, i is the disease, x is the year, N is the number of cases averted, and K is the cost per case treated, and T is treatment coverage. Number of vaccine doses needed ∑ ∑ ( , ) = =1 =1 Equation 10 Where N is number of vaccine doses needed, i is the disease, x is the year, A is the number of cases averted, and E is vaccine efficacy. Vaccine purchases 56 = ∑ =1 ∑=1(, ∗ , ) Equation 11 Where C is vaccine purchases, i is the disease, x is the year, N is the number of vaccine doses needed, K is the purchase price per dose. Phase I, II, and III clinical trial costs = ∑ =1 ∑=1(, ∗ , ) Equation 12 Where C is phase I, II, or III clinical trial costs, i is the disease, x is the year, T is the number of clinical trials started, and K is the cost per clinical trial. Clinical trial site operational costs = ∑ =1 ∑=1(, ∗ , ) Equation 13 Where C is clinical trial site operational costs, i is disease, x is year, T is the number of clinical trial sites needed, and K is the annual cost to maintain one clinical trial site. Manufacturing site construction costs = ∑ =1(, ∗ , ) Equation 14 Where C is manufacturing site construction costs, x is year, N is the number of new manufacturing sites needed, and K is the construction cost per new manufacturing site. Manufacturing site operational costs = ∑ =1(, ∗ , ) Equation 15 Where C is manufacturing site construction costs, x is year, N is the number of manufacturing sites operating, and K is the annual operating cost per manufacturing site. Productivity gains = ∑ =1 ∑=1([, ∗ , ∗ ∗ ] + [, ∗ , ∗ ∗ ]) Equation 16 Where P is productivity gains, i is disease, x is year, YLD is years of life lost to disability averted, YLL is years of life lost to death averted, C is the percent of cases age 15 to 69 years, D is the percent of deaths age 15 to 69 years, E is employment rate, and M is minimum wage. 57 Data Sources Current model inputs (All costs in 2022 USD) Input Value Source Phase I trial cost $2,360,000.00 Portfolio-2-Impact Tool (P2I) Phase II trial cost $13,550,000.00 P2I Phase III trial cost $122,210,000.00 P2I Phase I trial duration 1.57 P2I Phase II trial duration 2.23 P2I Phase III trial duration 2.33 P2I Phase I trial transition probability 0.684 P2I Phase I trial transition probability 0.459 P2I Phase I trial transition probability 0.708 P2I Clinical trial site annual operational cost $105,000.00 Data shared by countries Vaccination pilot project cost $30,000,000.00 Assumption Construction cost for full integrated $225,000,000.00 IFC manufacturing site Construction cost for fully integrated $275,000,000.00 IFC manufacturing site (mRNA technology) Annual operational cost of fully integrated $9,342,701.02 Data shared by countries manufacturing site Construction cost for fill and finish $72,000,000.00 IFC manufacturing site Annual operational cost of fill and finish $2,708,319.54 Data shared by countries manufacturing site Technology transfer costs $20,000,000.00 IFC Treatment cost per case (COVID-19, $42.51 Data shared by countries outpatient) Treatment cost per case (COVID-19, inpatient $865.05 Data shared by countries with mild symptoms) Treatment cost per case (COVID-19, inpatient $6,670.38 Data shared by countries requiring oxygen) Treatment cost per case (COVID-19, inpatient $9,493.36 Data shared by countries requiring ventilation) Treatment cost per case (COVID-19, inpatient requiring extracorporeal membrane $57,385.76 Data shared by countries oxygenation) Treatment cost per case (dengue) $290.48 Data shared by countries Treatment cost per case (HPV) $725.00 Data shared by countries Treatment cost per case (malaria) $116.06 Data shared by countries Treatment cost per case (pneumonia) $728.78 Data shared by countries Treatment cost per case (TB) $360.74 Data shared by countries Incidence – COVID-19 123,480,000 Literature reviews Case fatality rate (without treatment) – 0.0163 Literature reviews COVID-19 Case fatality rate (with treatment) – COVID- 0.0102 Literature reviews 19 YLD per case (without treatment) – COVID-19 0.0104 Literature reviews 58 Input Value Source YLD per case (with treatment) – COVID-19 0.0040 Literature reviews YLL per death – COVID-19 39.4784 Literature reviews Incidence – dengue 6,684,211 IHME Case fatality rate (without treatment) – 0.0001 Literature reviews dengue Case fatality rate (with treatment) – dengue 0.0054 Literature reviews YLD per case (without treatment) – dengue 0.0027 Literature reviews YLD per case (with treatment) – dengue 47.7133 Literature reviews YLL per death – dengue 0.0018 Literature reviews Incidence – HPV 44,734 IHME Case fatality rate (without treatment) – HPV 0.4827 Literature reviews Case fatality rate (with treatment) – HPV 0.0483 Literature reviews YLD per case (without treatment) – HPV 0.3700 Literature reviews YLD per case (with treatment) – HPV 0.1850 Literature reviews YLL per death – HPV 21.3630 Literature reviews Incidence – malaria 802,229 IHME Case fatality rate (without treatment) – 0.0012 Literature reviews malaria Case fatality rate (with treatment) – malaria 0.0007 Literature reviews YLD per case (without treatment) – malaria 0.0025 Literature reviews YLD per case (with treatment) – malaria 0.0013 Literature reviews YLL per death – malaria 36.9395 Literature reviews Incidence – pneumonia 35,997,397 IHME Case fatality rate (without treatment) – 0.0033 Literature reviews pneumonia Case fatality rate (with treatment) – 0.0037 Literature reviews pneumonia YLD per case (without treatment) – 0.0009 Literature reviews pneumonia YLD per case (with treatment) – pneumonia 21.5887 Literature reviews YLL per death – pneumonia 0.0052 Literature reviews Incidence – TB 943,459 IHME Case fatality rate (without treatment) – TB 0.1423 Literature reviews Case fatality rate (with treatment) – TB 0.0100 Literature reviews YLD per case (without treatment) – TB 0.9990 Literature reviews YLD per case (with treatment) – TB 0.0167 Literature reviews YLL per death – TB 21.2379 Literature reviews Vaccine efficacy (COVID-19) 62.4%lviii Literature reviews lviii Risk, M., Hayek, S. S., Schiopu, E., Yuan, L., Shen, C., Shi, X., Freed, G., & Zhao, L. (2022). COVID-19 vaccine effectiveness against omicron (B.1.1.529) variant infection and hospitalisation in patients taking immunosuppressive medications: a retrospective cohort study. The Lancet. Rheumatology, 4(11), e775–e784. https://doi.org/10.1016/S2665-9913(22)00216-8 https://urldefense.com/v3/__https:/www.nejm.org/doi/full/10.1056/NEJMoa2119451__;!!OToaGQ!oSnhN4H5jiRnyfnuMK 1uKdqBfPnpT7vRWGYAjclSqJ7LEG71-Dm-sm8Wysb7sYUsPFha4TmS-1t6DC2xLUlBNdT6tf8kWmLRBxjMEw$ 59 Input Value Source Vaccine efficacy (dengue) 61.0%lix Literature reviews Vaccine efficacy (HPV) 95.4%lx Literature reviews Vaccine efficacy (malaria) 65.0%lxi,lxii Literature reviews Vaccine efficacy (pneumonia) 65.0%lxiii Literature reviews Vaccine efficacy (TB) 65.0% Assumption Treatment coverage (COVID-19, percent of 10.0% Assumption non-hospitalized cases that receive care) Treatment coverage (COVID-19, percent of all 5.6%lxiv Literature reviews cases that require hospitalization) Treatment coverage (COVID-19, percent of 77.0% Data shared by countries hospitalized cases with mild symptoms) Treatment coverage (COVID-19, percent of 20.0% Data shared by countries hospitalized cases requiring oxygen) Treatment coverage (COVID-19, percent of 2.9% Data shared by countries hospitalized cases requiring ventilation) Treatment coverage (COVID-19, percent of hospitalized cases requiring extracorporeal 0.1% Data shared by countries membrane oxygenation) Treatment coverage (dengue) 18.4% Data shared by countries Treatment coverage (HPV) 50.0% Assumption Treatment coverage (malaria) 32.1%lxv Literature reviews Treatment coverage (pneumonia) 68.5%lxvi Literature reviews Treatment coverage (TB) 57.9%lxvii Literature reviews lix Dengue vaccine arrives as global warming boosts infection risk. Accessed January 26, 2023. https://www.bloomberg.com/news/newsletters/2022-11-07/dengue-vaccine-arrives-as-global-warming-boosts-infection- risk lx Basu, P., Malvi, S. G., Joshi, S., Bhatla, N., Muwonge, R., Lucas, E., Verma, Y., Esmy, P. O., Poli, U. R. R., Shah, A., Zomawia, E., imple, S., Jayant, K., Hingmire, S., Chiwate, A., Divate, U., Vashist, S., Mishra, G., Jadhav, ., Siddiqi, M., … Sankaranarayanan, R. (2021). Vaccine efficacy against persistent human papillomavirus (HPV) 16/18 infection at 10 years after one, two, and three doses of quadrivalent HPV vaccine in girls in India: a multicentre, prospective, cohort study. The Lancet. Oncology, 22(11), 1518–1529. https://doi.org/10.1016/S1470-2045(21)00453-8 lxi Recent data suggests a malaria vaccine developed at the University of Oxford may have an efficacy up to 80% (https://pharmaphorum.com/news/high-hopes-as-new-malaria-vaccine-shows-unprecedented-efficacy/). However, for this study a more conservative estimate of 65% is used, as indicated by clinical trial data for the Mosquirix vaccine (https://pubmed.ncbi.nlm.nih.gov/22408046/). lxii Wilby, K. J., Lau, T. T., Gilchrist, S. E., & Ensom, M. H. (2012). Mosquirix (RTS,S): a novel vaccine for the prevention of Plasmodium falciparum malaria. The Annals of pharmacotherapy, 46(3), 384–393. https://doi.org/10.1345/aph.1AQ634 lxiii Tereziu S, Minter DA. Pneumococcal Vaccine. [Updated 2022 Jan 21]. In: StatPearls [Internet]. Treasure Island (FL): StatPearls Publishing; 2022 Jan-. Available from: https://www.ncbi.nlm.nih.gov/books/NBK507794/ lxiv COVID Data Tracker. Accessed January 26, 2023. https://covid.cdc.gov/covid-data-tracker/#new-hospital-admissions lxv Global health observatory. Accessed January 26, 2023. https://www.who.int/data/gho/data/indicators/indicator- details/GHO/number-of-malaria-cases-treated-with-any-first-line-tx-courses-including-artemisinin-based-combination- therapies-acts lxvi UNICEF Data. Pneumonia. Accessed January 26, 2023. https://data.unicef.org/topic/child-health/pneumonia/ lxvii https://www.who.int/data/gho/data/indicators/indicator-details/GHO/tuberculosis-treatment-coverage 60 Appendix 3: Incremental Manufacturing Scenario The incremental manufacturing scenario assumes the five focus countries will leverage already existing vaccine manufacturing sites in the region, rather than investing in new manufacturing facilities. This scenario therefore models a 25 percent reduction in all manufacturing costs (from the regional scenario) to represent incremental investments in already existent manufacturing capacity, as opposed to larger investments in new manufacturing facilities. Total costs, benefits, and benefit-cost ratio (BCR) Total costs (2022 USD millions)* $2,258.24 Net benefits (2022 USD millions)** $82,285.18 BCR*** 36.44 *Regulation, clinical trials, tech transfer, and manufacturing costs. **Treatment costs averted. ***Net benefits/total costs. Clinical trials and manufacturing costs Clinical trial costs (2022 USD millions) Phase I trial costs $4.58 Phase II trial costs $39.47 Phase III trial costs* $532.85 Clinical trial site operational costs $3.16 Manufacturing costs (2022 USD millions) Site construction costs $760.19 Site operational costs $459.66 Tech transfer costs $77.67 Regulation costs (2022 USD millions) IDP investments $380.66 *Includes pilot project costs for HPV and pneumonia. Economic benefits (USD 2022) Treatment costs averted (2022 USD millions) $82,285.18 Health benefits Cases averted (millions) 194.71 Deaths averted (millions) 0.93 DALYs averted (millions) 22.80 61 Appendix 4: Productivity Gains The productivity gains were modeled for each of the four scenarios in the main text as well as the scenario in Appendix 3. The productivity gains as well as the BCR, with and without productivity gains included as a benefit, are shown in the table below. Scenario Productivity gains BCR without BCR with productivity (2022 USD millions) productivity gains gains Regional investment $24,961.55 30.88 40.24 scenario ASEAN vaccine $28,535.64 35.09 45.80 purchasing scenario National investment $2,737.52 9.51 11.70 scenario Pandemic outbreak $110,201.51 31.15 50.93 scenario Incremental $24,961.55 36.44 47.49 manufacturing scenario Economic productivity was calculated by monetizing YLLs averted and YLDs averted (Equation 16). Economic productivity from YLLs averted was calculated as the product of total YLLs averted among the working population, employment rate, and annual minimum wage. Similarly, economic productivity from YLDs averted was calculated as the product of total YLDs averted among the working population, employment rate, and annual minimum wage. The working population was defined as individuals ages 15 to 69 years. Annual minimum wage estimates and employment rates used to define the working population across ASEAN countries can be found below. Average annual minimum wage and employment rates across the ASEAN countries were used. In the calculation of average annual minimum wage, Brunei and Singapore were excluded as outliers. Country Employment rate Annual minimum wage Source (2022 USD) Indonesia 64.7% $3,636 ILOSTAT Malaysia 62.0% $7,848 ILOSTAT Philippines 56.2% $6,864 ILOSTAT Thailand 65.9% $2,688 ILOSTAT Vietnam 72.4% $2,280 ILOSTAT Brunei 58.6% $17,040 ILOSTAT Cambodia 79.8% $3,156 ILOSTAT Lao PDR 75.6% $2,880 ILOSTAT Myanmar 54.9% $1,884 ILOSTAT Singapore 66.3% $41,808 ILOSTAT 62 Appendix 5: 5.0% Discount Rate Scenarios 1-4 were modeled, as well as the incremental manufacturing scenario in Appendix 3, using a 5.0% discount rate to better reflect the LMIC economies. The resulting BCRs are shown in the table below. Scenario BCR with 3.0% discount rate BCR with 5.0% discount rate Regional investment scenario 30.88 26.15 ASEAN vaccine purchasing 35.09 29.71 scenario National investment scenario 9.51 7.90 Pandemic outbreak scenario 31.15 26.50 Incremental manufacturing 36.44 30.85 scenario 63 Appendix 6: Lower Phase III Clinical Trial Costs In the main text phase III clinical trial cost data was obtained from the P2I model (US$122 million per phase III clinical trial). Here scenarios 1-4 are modeled using a phase III clinical trial cost of US$20 million for all diseases to reflect potential reductions in R&D costs across the focus countries. The US$20 million estimate is based on clinical trial data shared by the focus countries. In this sensitivity analysis a reduction is assumed in the cost of vaccination pilot projects for HPV and pneumonia from US$30 million to US$5 million. The resulting BCRs are shown in the table below. Scenario BCR with original phase III trial BCR with reduced phase III trial costs costs Regional scenario 30.88 37.08 Regional pooled procurement 35.09 42.13 scenario National scenario 9.51 14.80 Pandemic scenario 28.27 34.05 Incremental manufacturing 36.44 45.39 scenario 64 Appendix 7: Two-year Duration Between Vaccine Launch and Market Entry Here scenarios 1-4 were modeled including the incremental manufacturing scenario in Appendix 3 using a duration of two years between vaccine launch from the R&D pipeline and market entry. The resulting BCRs are shown in the table below. Scenario BCR with original one-year BCR with two-year duration duration Regional scenario 30.88 27.97 Regional pooled 35.09 31.79 procurement scenario National scenario 9.51 8.61 Pandemic outbreak scenario 28.27 24.89 Incremental manufacturing 36.44 33.01 scenario 65 Appendix 8: Disease Incidence, Deaths, and DALYs in ASEAN Countries Country 2019 2019 Country Disease 2019 DALYs Source population incidence* deaths* https://www.thelancet. com/journals/lancet/art Brunei COVID-19 441,532 35,400 125 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art Cambodia COVID-19 16,946,446 3,700,000 14,300 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art Indonesia COVID-19 276,361,788 161,000,000 639,000 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art Lao PDR COVID-19 7,379,358 1,250,000 1,090 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art Malaysia COVID-19 32,776,195 10,200,000 40,700 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art Myanmar COVID-19 54,806,014 17,800,000 85,900 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art Philippines COVID-19 111,046,910 59,200,000 158,000 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art Singapore COVID-19 5,453,566 408,000 585 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art Thailand COVID-19 69,950,844 8,100,000 28,300 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. Vietnam COVID-19 98,168,829 8,460,000 45,200 NA com/journals/lancet/art 66 Country 2019 2019 Country Disease 2019 DALYs Source population incidence* deaths* icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art ASEAN total COVID-19 673,331,482 270,153,400 1,013,200 NA icle/PIIS0140- 6736(22)00484- 6/fulltext https://www.thelancet. com/journals/lancet/art Focus COVID-19 588,304,566 246,960,000 911,200 NA icle/PIIS0140- country total 6736(22)00484- 6/fulltext Brunei dengue 441,532 3,829 1 74 IHME Cambodia dengue 16,946,446 194,685 53 5,485 IHME Indonesia dengue 276,361,788 2,655,180 10,074 647,506 IHME Lao PDR dengue 7,379,358 94,474 15 1,966 IHME Malaysia dengue 32,776,195 457,684 274 17,625 IHME Myanmar dengue 54,806,014 392,554 366 30,013 IHME Philippines dengue 111,046,910 1,832,712 2,174 177,025 IHME Singapore dengue 5,453,566 58,228 5 684 IHME Thailand dengue 69,950,844 699,668 212 18,978 IHME Vietnam dengue 98,168,829 1,038,968 122 16,787 IHME ASEAN total dengue 673,331,482 7,427,981 13,297 916,143 IHME Focus dengue 588,304,566 6,684,211 12,856 877,921 IHME country total Brunei HPV 441,532 53 18 634 IHME Cambodia HPV 16,946,446 1,378 709 23,732 IHME Indonesia HPV 276,361,788 17,054 8,703 291,925 IHME Lao PDR HPV 7,379,358 451 234 8,381 IHME Malaysia HPV 32,776,195 2,602 1,204 35,386 IHME Myanmar HPV 54,806,014 4,142 2,145 72,415 IHME Philippines HPV 111,046,910 6,776 3,120 110,566 IHME Singapore HPV 5,453,566 306 105 2,879 IHME Thailand HPV 69,950,844 8,335 3,657 107,652 IHME Vietnam HPV 98,168,829 9,966 4,718 139,883 IHME ASEAN total HPV 673,331,482 51,063 24,613 793,452 IHME Focus HPV 588,304,566 44,734 21,402 685,412 IHME country total Brunei Malaria 441,532 0 0 0 IHME Cambodia Malaria 16,946,446 45,389 57 4,688 IHME Indonesia Malaria 276,361,788 760,372 637 44,375 IHME 67 Country 2019 2019 Country Disease 2019 DALYs Source population incidence* deaths* Lao PDR Malaria 7,379,358 17,872 23 1,731 IHME Malaysia Malaria 32,776,195 5,717 5 692 IHME Myanmar Malaria 54,806,014 62,489 294 18,668 IHME Philippines Malaria 111,046,910 11,893 46 3,023 IHME Singapore Malaria 5,453,566 0 0 0 IHME Thailand Malaria 69,950,844 6,647 1 736 IHME Vietnam Malaria 98,168,829 17,600 59 3,659 IHME ASEAN total Malaria 673,331,482 927,978 1,122 77,572 IHME Focus Malaria 588,304,566 802,229 748 52,485 IHME country total Brunei Pneumonia 441,532 9,673 82 2,128 IHME Cambodia Pneumonia 16,946,446 1,299,679 12,066 496,631 IHME Indonesia Pneumonia 276,361,788 15,385,208 44,317 1,570,882 IHME Lao PDR Pneumonia 7,379,358 424,773 3,392 180,605 IHME Malaysia Pneumonia 32,776,195 2,432,943 21,711 463,891 IHME Myanmar Pneumonia 54,806,014 2,852,127 21,453 930,003 IHME Philippines Pneumonia 111,046,910 8,487,200 58,413 1,943,794 IHME Singapore Pneumonia 5,453,566 155,897 3,471 48,695 IHME Thailand Pneumonia 69,950,844 4,783,008 31,037 603,773 IHME Vietnam Pneumonia 98,168,829 4,909,038 21,345 580,374 IHME ASEAN total Pneumonia 673,331,482 40,739,546 217,288 6,820,776 IHME Focus Pneumonia 588,304,566 35,997,397 176,823 5,162,714 IHME country total Brunei TB 441,532 195 19 596 IHME Cambodia TB 16,946,446 47,104 6,046 221,486 IHME Indonesia TB 276,361,788 332,367 76,549 2,664,203 IHME Lao PDR TB 7,379,358 7,438 2,093 81,542 IHME Malaysia TB 32,776,195 30,238 1,992 65,795 IHME Myanmar TB 54,806,014 100,543 14,313 519,497 IHME Philippines TB 111,046,910 327,468 29,181 1,145,694 IHME Singapore TB 5,453,566 2,117 58 1,477 IHME Thailand TB 69,950,844 98,887 7,775 182,438 IHME Vietnam TB 98,168,829 154,499 18,681 527,106 IHME ASEAN total TB 673,331,482 1,100,856 156,706 5,409,835 IHME Focus TB 588,304,566 943,459 134,177 4,585,237 IHME country total *Values for COVID-19 represent cumulative estimated cases/deaths through 2021. 68 Appendix 9: Detailed Overview of Economic Benefits Scenario 1. Economic benefits (2022 USD millions) Treatment costs averted $82,285.18 Scenario 2. Economic benefits (2022 USD millions) Treatment costs averted $93,118.64 Vaccine sales $391.64 Scenario 3. Economic benefits (2022 USD millions) Treatment costs averted $11,841.53 Scenario 4. Economic benefits (2022 USD millions) Treatment costs averted $90,605 69 Appendix 10: Breakdown of Clinical Trial, Manufacturing, and Regulation Costs by Scenario Regional Scenario All costs expressed in 2022 USD Total cost = $2,665 M $381 M (14.3%) $580 M (21.8%) Clinical trial costs Manufacturing costs Regulation costs $1704 M (63.9%) All costs expressed in 2022 USD $5 M $39 M Total cost = $2,665 M (0.2%) (1.5%) Phase I trial costs $78 M $381 M (2.9%) (14.3%) Phase II trial costs $533 M (20.0%) $3 M Phase III trial costs (0.1%) Clinical trial site operational $613 M costs (23.0%) Site construction costs $1014 M (38.0%) Site operational costs Tech transfer costs 70 Regional Pooled Procurement Scenario All costs expressed in 2022 USD Total cost = $2,665 M $381 M (14.3%) $580 M (21.8%) Clinical trial costs Manufacturing costs Regulation costs $1704 M (63.9%) All costs expressed in 2022 USD $5 M Total cost = $2,665 M (0.2%) $39 M (1.5%) Phase I trial costs $78 M $381 M Phase II trial costs (2.9%) (14.3%) $533 M (20.0%) Phase III trial costs $3 M (0.1%) Clinical trial site operational $613 M costs (23.0%) Site construction costs $1014 M (38.0%) Site operational costs Tech transfer costs 71 National Scenario All costs expressed in 2022 USD Total cost = $1,246 M $127 M (10.2%) $580 M Clinical trial costs (46.6%) Manufacturing costs Regulation costs $539 M (43.2%) All costs expressed in 2022 USD Total cost = $1,246 M $5 M $39 M (0.4%) (3.2%) Phase I trial costs $78 M $127 M (6.2%) Phase II trial costs (10.2%) Phase III trial costs $173 M $533 M Clinical trial site operational (13.9%) (42.8%) costs Site construction costs $288 M Site operational costs (23.1%) Tech transfer costs $3 M (0.3%) 72 Pandemic Outbreak Scenario All costs expressed in 2022 USD Total cost = $2,853 M $381 M (13.3%) $699 M (24.5%) Clinical trial costs Manufacturing costs Regulation costs $1774 M (62.2%) All costs expressed in 2022 USD $5 M Total cost = $2,853 M $39 M (0.2%) (1.4%) Phase I trial costs $97 M $381 M (3.4%) Phase II trial costs (13.3%) $652 M (22.8%) Phase III trial costs $3 M Clinical trial site operational $613 M (0.1%) costs (21.5%) Site construction costs $1064 M Site operational costs (37.3%) Tech transfer costs 73 Incremental Scenario All costs expressed in 2022 USD Total cost = $2,258 M $381 M (16.9%) $580 M (25.7%) Clinical trial costs Manufacturing costs Regulation costs $1298 M (57.5%) All costs expressed in 2022 USD Total cost = $2,258 M $5 M $39 M (0.2%) (1.7%) Phase I trial costs $381 M Phase II trial costs $78 M (16.9%) $533 M (3.4%) (23.6%) Phase III trial costs $3 M Clinical trial site operational (0.1%) costs $460 M (20.4%) Site construction costs $760 M Site operational costs (33.7%) Tech transfer costs 74 Appendix 11: Domestic General Government Health Expenditure (GGHE-D) of ASEAN Countries Country Annual GGHE-D* Total GGHE-D over 19 years** Indonesia $19,898,051,285.72 $285,015,689,222.89 Malaysia $7,332,599,726.97 $105,030,685,415.80 Philippines $8,248,502,213.63 $118,149,888,635.65 Thailand $15,343,853,508.72 $219,782,275,174.93 Vietnam $7,248,141,023.59 $103,820,915,915.81 Total across focus countries $58,071,147,758.63 $831,799,454,365.09 Scenario Total cost (2022 USD) Total cost as a percent of total GGHE-D of focus countries over 19 Regional $2,664,860,398.84 0.32% *Values are from the Global Health Expenditure Database and represent annual GGHE-D from the year 2020, expressed in 2022 USD. **Values were calculated by multiplying the annual GGHE-D by 19 and discounting at an annual rate of 0.03. 75