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Thinking About Bioshield Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy IGCC/AAAS.

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Presentation on theme: "Thinking About Bioshield Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy IGCC/AAAS."— Presentation transcript:

1 Thinking About Bioshield Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu IGCC/AAAS Wye River Biosecurity Workshop August 16, 2006

2 The Problem The Need Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

3 The Problem The Need The Budget Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

4 The Problem The Need The Budget Beyond Analogies Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

5 Current Ideas: 1. Boosted Demand 2. Advanced Purchase Commitments 3. Virtual Pharma Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

6 1. Boosted Demand Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

7 Problem: Sunk Costs Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

8 2. Advanced Purchase Commitments M. Kremer & R. Glennerster, Strong Medicine (Princeton University Press 2004) Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

9 Problem: How Big a Prize? Accounting Cost of R&D J. DiMasi, R. Hansen, and H. Grabowski, The Price of Innovation: New Estimates of Drug Development Costs, Journal of Health Economics 22:151 (2003) Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

10 Problem: How Big a Prize? Accounting Cost of R&D Liquidity Constraints Berndt E. et al., Advanced markets for a malaria vaccine: Estimating costs and effectiveness. Working Paper 11288 (National Bureau of Economic Research 2005), available at http://www.nber.org/papers/w1 128. Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

11 Problem: How Big a Prize? Accounting Cost of R&D Liquidity Constraints Bare Bones Programs Global Alliance for TB Drug Development, Economics of TB Drug Development (2006) available at http://66.216.124.114/pdf/E conomics%20Report%20F ull%20(final).pdf. Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

12 [A]ny plan that has a disparity of $3 billion to $10 billion is one that needs close attention. Thats a variation of 300 percent. So I will be happy to talk to you about it after I read it, but thats a big disparity and a big controversy… - Rep. Nancy Pelosi Edward Epstein, Tearing Down Dam a Bomb In Capitol, SF Chronicle, July 22 2006. B1, 3. Problem Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

13 3. Virtual Pharma Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

14 Benefit: Competitive Bidding Problem: Picking Winners Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

15 Problem: Picking Winners History Covert N., Cutting edge: A history of Fort Detrick. available at http://www.detrick.army.mil /detrick/cutting_edge/index.cfm?chapter12 Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

16 Problem: Picking Winners History Empirical Evidence Moran M, Ropars AL, Guzman J, Diaz J, Garrison C. The new landscape of neglected disease drug development. London UK: Pharmaceutical R&D Policy Project: 2005. Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

17 Problem: Picking Winners History Empirical Evidence Theory Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

18 Some Political Advice: Return of The Dollar-a-Year Men? Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

19 Heck, Its Just A Business Plan… Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu

20 References S. Maurer, "Choosing the Right Incentive Strategy for R&D in Neglected Diseases," World Health Organization Bulletin 84:376 (2006), available at http://www.who.int/bulletin/volumes/84/5/376.pdf. S. Scotchmer, Innovation & Incentives (MIT University Press 2004). G. Spagnolo, Procuring Innovation, in Handbook of Procurement (Spagnolo, Dimitri & Piga eds.), Cambridge, UK: Cambridge University Press (2006: in press). Stephen M. Maurer Information & Homeland Security Project UC Berkeley/Goldman School of Public Policy smaurer@berkeley.edu


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