FGFJ Issue Brief
August 2021

Launching a Pandemic Financing Facility:
Three Proposals & Their Implications for the Global FundOver the past three months, three different commissions issued reports proposing major reforms of the global
health architecture to improve pandemic preparedness and response (PPR). Each recommends the creation of a
new institution for financing PPR, along with a bevy of other reforms, and all rely heavily on preexisting global
health organizations such as the Global Fund to Fight AIDS, Tuberculosis and Malaria to help carry out their
mission.
These proposals have been inspired by the cascade of failures in the global response to COVID-19. At the onset of the pandemic, the financial mechanisms intended to support an international pandemic response—theWHO’s Contingency Fund for Emergencies and the World Bank’s Pandemic Emergency Financing Facility(PEF)—proved to be too small and too slow to make a difference. Then, countries’ reluctance to fund arobust international response, insufficient global coordination, overly nationalistic approaches, and glaring
gaps in pandemic preparation by national governments and international organizations allowed COVID-19
to spread uncontrolled, killing millions around the world and leading to economic losses that the IMF warns
may total US$28 trillion.1
The proposed reforms represent a critical step toward ensuring that future pandemics do not exact a similar
human and economic toll. But it is important that these options be carefully examined to ensure that the current momentum culminates in an efficient and effective new approach.

Three Commissions, Three Plans
World leaders seem convinced that action needs to be taken to ensure that the world is better equipped nexttime and that this should include the creation of a new PPR financing facility. The Biden Administration telegraphed its resolve by allocating $250 million in its FY2022 budget to serve as seed funding for a new “global
health security financing mechanism.”2 UK Prime Minister Boris Johnson has called for a plan to develop anddeploy diagnostics, therapeutics, and vaccines worldwide for the next pandemic within 100 days, and a rangeof other world leaders have emphasized their commitment to major reforms as well.
The first commission to release its reform proposal was the WHO’s Independent Panel for Pandemic
Preparedness and Response (IPPPR), which announced its recommendations in May 2021.3 The panel called
for the establishment of a Global Health Threats Council, a new, independent, Geneva-based institution, thatwould provide high-level political leadership for the pandemic response, and it recommended that this council
oversee a new International Pandemic Financing Facility (IPFF). The IPFF would raise $5 billion to $10 billion
a year from national governments, which would be expected to make 10-year pledges. In normal times, thisannual budget would be expended on preparedness activities, from building up global disease surveillance systems to funding country-led preparedness strategies in low- and middle-income countries (LMICs). But oncea pandemic strikes and the WHO declares a Public Health Emergency of International Concern (PHEIC), theFGFJ Issue Brief

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facility would be empowered to issue $50–$100 billion in bonds using the 10-year funding commitments as
collateral, then deploy this war chest through existing health organizations to fight the disease.
The IPPPR report was followed in mid-June by the UK-led Pandemic Preparedness Partnership (PPP)’s proposal for the G7 Summit.4 It, too, called for the creation of a new PPR financing facility along with a broad
range of other reforms. The commission envisions this as being hosted at the World Bank and focusing primarily on emergency surge funding when a pandemic hits. National governments, starting with the G7 countries, would agree in advance to contribute a specified amount upon the declaration of a PHEIC, and then thefund would work through Gavi and the Global Fund to distribute billions of dollars in diagnostics, therapeutics, and vaccines to cover 30 percent of the population of LMICs. Concessional loans from the World Bankor the IMF would be available for countries to purchase additional supplies as well.
A third plan was released the following month, on July 9, by the G20’s High Level Independent Panel on
Financing the Global Commons for Pandemic Preparedness and Response (HLIP).5 Like the others, it calls
for a range of reforms to strengthen the WHO and other global health initiatives, and it proposes establishing a Global Health Threats Fund, which would operate with an annual budget of $10 billion. This would
be hosted at the World Bank as a Financial Intermediary Fund (FIF) and its operations would be managed
by a technical panel, the Global Health Threats Board, which would be wholly independent of the World
Bank. The HLIP envisions the Global Health Threats Board as potentially operating under the Global HealthThreats Council, which was originally proposed by the IPPPR. The Global Health Threats Fund would focus
on financing global gaps in pandemic preparedness, including supporting R&D, expanding manufacturing
capacity for vaccines and medical products, and providing grants for regional- and country-level preparedness projects. The HLIP acknowledges the need for a financing window to provide emergency surge funding
after a PHEIC declaration, but while leaving open the possibility that this role could also be undertaken by
the Global Health Threats Fund, it strongly recommends that the surge funding component be left to theWorld Bank.

Areas of Consensus
All three proposals agree on a number of key points. There is consensus that a new PPR financing facility isdesperately needed and that it should be much larger and faster moving than past efforts. The PEF, for example, was designed to mobilize up to $500 million, but the current proposals call for creating a financing
window that can deploy 20 to 200 times more.
Each of the proposals also acknowledges a pressing need to mobilize new funding for preparedness activities
during “peacetime” as well as large-scale emergency funding when a pandemic strikes, even though they differ on whether the PPR financing facility should take on just one or both of these roles.
They also reflect a shared sense that the funding for the PPR financing facility should be contributed in a
progressive manner, with rich countries paying a larger share than LMICs. Similarly, the commissions wereconcerned that donor funding for the new facility not be diverted from other important ODA priorities, andthey recommended that it could potentially come from non-ODA budgets.
Finally, all of the reports make it clear that a new PPR financing facility should not compete with existing global
health institutions, and that instead it should strive to implement its mission through them when possible.
Each proposal recommends avoiding the creation of an expansive, new “brick and mortar” institution, instead
calling for a lean secretariat and explicitly addressing, or at least hinting at, the need to channel the facility’s
money through existing organizations such as the Global Fund, Gavi, and CEPI. All of them also support expanded engagement in global health by the multilateral development banks, starting with the World Bank andthe International Monetary Fund.

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Table 1: Proposed PPR financing mechanisms
Independent Panel for Pandemic
Preparedness & Response(IPPPR)

Pandemic Preparedness
Partnership (PPP)High Level Independent Panel on
Financing the Global Commonsfor PPR (HLIP)

Proposed mechanism

International Pandemic Financing
Facility“A funding facility”

Global Health Threats Fund

Prepared for

WHO (May 2021)

G7 (June 2021)

G20 (July 2021)

Commission chairs

Helen Clark & Ellen Johnson
Sirleaf

Patrick Vallance & Melinda Gates

Ngozi Okonjo-Iweala,
Larry Summers & Tharman
Shanmugaratnam

Funding targets

LMICs

LMICs & UMICs that opt in

Global gaps, including funding for
LMICs

Functions of proposed new
institution

Regular funding for pandemic
preparedness

Surge funding for emergencies

Regular funding for pandemic
preparedness

Budget & financing modality

What facility’s preparedness
funding covers

Surge funding for emergencies(Also recommends expanded
preparedness funding throughexisting institutions)

10-year commitments of $5-$10
billion/year from all countries

Commitments for surge funding
pre-negotiated before pandemic

For surge funding, issues $50–
$100 billion in bonds, collateralized against future commitments

Contributions paid in & deployedwhen PHEIC declared(1) Develop & implement country-led preparedness strategies;(2) regional innovations (surveillance platforms, pooled manufacturing & bulk procurement);(3) global initiatives (R&D systems,
surveillance, etc.)

N/A(Can possibly provide surge funding although recommends this beleft to the World Bank)$10 billon/year; initially fromG20 governments & eventually
expanding to all countries
Possibility of bond issuance forsurge funding(1) Build a global surveillance
network; (2) fund country- andregional-level investment in global
public goods; (3) support R&D

What facility’s surge funding
coversNecessary portions of response
in a flexible manner; guided by
pre-arranged financing plans forvarious pandemic scenarios

Diagnostics, therapeutics & vaccines provided to LMICs to cover
30% of their populations

Recommends that World Bank
provide the surge funding but, if
not, GHTF could fund development, manufacturing, & delivery of
medical countermeasures

GovernanceOverseen by a Global HealthThreats Council (led at head ofstate level, UNGA & G20 nominateco-chairs)

Overseen by a Global Health
Board (under the G20, chaired by
WHO)

Overseen by Global HealthThreats Board (anchored in the
G20, under the Global HealthThreats Council)

Institutional structure

Lean independent secretariat
located in Geneva

Global Pandemic Monitoring
Board serves as secretariat toconvene Global Health Board

Operates as an independent
Financial Intermediary Fund (FIF)
at the World Bank

Fund management

International Pandemic Financing
Facility

Fund hosted by the World Bank,
with distribution of diagnostics &therapeutics through the Global
Fund and vaccines through Gavi

Operates as an independent
Financial Intermediary Fund (FIF)
at the World Bank; World Bank
plays solely a “treasury” function

Who decides apportionmentof funding

Global Health Threats Council

WHO (based on prior consultations with Gavi, Global Fund &CEPI)

Global Health Threats Board

Implementation

Funds should be channeledthrough existing implementing
agencies such as the Global
Fund; recommends against creating new agencies.

Distribution of vaccines throughGavi, and diagnostics & therapeutics through the Global Fund,with WHO determining equitable
apportionment

Funds should be deployed
across international and regional
institutions & networks (including
for activities by the World Bank,
Global Fund, etc.)

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Areas of Divergence
Despite this agreement on the broad outlines, the proposals do have some significant differences. The PPP
and HLIP proposals recommend situating the PPR financing facility at the World Bank, although the HLIP
report goes to great lengths to clarify that it should operate completely independently of World Bank management and that the World Bank should simply serve a “treasury” function. Meanwhile, the IPPPR recommends locating the facility in Geneva under an independent Global Health Threats Council, without theWorld Bank involved in its governance.
As noted above, the commissions disagree on whether the PPR financing facility should both handle preparedness activities and emergency surge funding for a pandemic response. The IPPPR recommends having
a new facility that takes on both functions. The PPP proposes that it focus solely on surge funding. The HLIP,
meanwhile, takes the opposite tack, suggesting that the new facility concentrate primarily on preparedness
in the hope that the World Bank can swiftly mobilize surge funding when there is an emergency.6 Also,
the IPPPR and PPP schemes explicitly direct their funding toward improving LMICs’ PPR capacity, while
the HLIP proposal focuses more on global gaps, presumably leaving the option open for funds to also be
expended in richer countries for efforts, such as R&D, that advance the global good.
These disagreements also extend to the modality of surge funding. The IPPPR proposes an ambitious, prearranged plan for bond issuance to mobilize $50–$100 billion when a PHEIC is declared. Meanwhile, the PPP
proposal relies on the resolve of donors to quickly contribute large sums that have been negotiated in advanceto the PPR financing facility when a crisis arises. And the HLIP proposal, while keeping the door open tosome sort of bond issuance along IPPPR lines to allow the new facility to provide surge funding, recommends
leaving this to the World Bank.

Unresolved Issues
Unsurprisingly, there are several major challenges that need to be resolved to make the reform proposals
workable.
The question as to who the PPR financing facility benefits and how it is governed looms over the debate on
which direction to take. Depending on how it is framed, the new facility and the associated reforms could
easily be perceived as an effort to improve health security for rich countries so that new pandemics are halted
before crossing their borders while doing little to help less privileged countries with the ongoing diseases andhealth threats that kill too many of their citizens on an everyday basis. This issue bleeds into the governanceof the proposed facility. If the facility is overseen primarily by donor countries and LMICs struggle to attainequitable representation, it will be difficult to sustain the active participation of LMICs that is necessary to makeit effective.
Furthermore, in recent decades, the most effective new global health organizations have been the “public-private
partnership” types like Gavi and the Global Fund. Their success seems to stem in part from their ability tomove nimbly because they are not controlled solely by national governments, as opposed to their more traditional UN-style counterparts, which can get bogged down in politics and bureaucracy. It also seems to derivein part from the ways in which the diverse representation on their governing boards—including civil society,the private sector, and affected communities—and the broad engagement of different stakeholders in theircountry-level operations incentivizes them to be more responsive to needs on the ground and to reach themost vulnerable communities. This implies it will be important to consider how to replicate these factors in thegovernance of the new facility.
The institutional structure of the new facility will also be crucial. All of the proposals stress that it should be a“lean” and “flexible” operation. However, situating it at the World Bank raises the question of whether it canFGFJ Issue Brief5

be designed to operate independently from World Bank funding guidelines and reporting requirements. The
proposals generally envision the facility as needing to operate through preexisting global health organizations
to deploy its financing, but layering World Bank funding requirements on top of the new facility’s own guidelines as well as the implementing organizations’ long-established regulations could be a recipe for bureaucratic
red tape.
Fundamental questions also remain about where funding for the new facility will come from. While entirely
appropriate given what is at stake, the proposed budgets are extremely ambitious, and mobilizing the needed
funds will require a level of political will on the part of the world’s richest countries that has so far been lacking.
It is also fair to question whether large-scale surge funding really can be readily ramped up during a crisis as
the PPP and HLIP plans anticipate.7
Finally, all of the proposals are vague about what sort of institutional commitments should be arranged between the PPR financing facility and the existing global health organizations that are expected to implement
PPR programs. The major global health organizations already have their own core missions, and adding
a new PPR mandate will require them to divert staffing and institutional resources from other areas. One
can envision how they might make this work if they are able to have a stream of predictable and stable funding
combined with the flexibility and discretion to ensure that it complements their ongoing work and is sufficiently
responsive to country leadership. However, it will be much more difficult for them to be effective and to justify
their enlarged mission to their stakeholders if they are instead expected to just undertake preparedness activities on an on-and-off, project-by-project basis.

The Global Fund’s Role
All three reform proposals envision a prominent role for the Global Fund in supporting the new PPR financing facility, and they make it clear that the facility should not divert resources from existing global healthorganizations or replicate their roles. The IPPPR report stresses that the new facility’s funds should be channeled through implementing organizations such as the Global Fund, Gavi, and CEPI, and the PPP report
recommends utilizing “the Global Fund for (the deployment of) diagnostics and therapeutics, and Gavi for
vaccines, with WHO determining equitable apportionment.”8 While it is more vague, the HLIP report alsostresses that “investments in pandemic preparedness should be integrated with the ongoing efforts and infrastructure to tackle endemic infectious diseases,”9 and it lists the World Bank and the Global Fund as its
two examples of organizations that would have financing from the Global Health Threats Fund channeledthrough them.10
There are a number of reasons why all three commissions envision the Global Fund playing such an important role. As part of its day-to-day work of helping countries detect, prevent, and treat malaria, tuberculosis,
and HIV/AIDS, the Global Fund already invests in a broad range of “dual use” activities that are precisely
the kinds needed to detect and contain other new diseases. For instance, sizable proportions of its funding
already go toward building up multi-disease surveillance systems, laboratory networks, febrile disease detection capacity, healthcare workforces, and supply chains to purchase and deploy the kinds of supplies, like
PPE, that are urgently needed for pandemic preparedness. In fact, a 2021 study by Georgetown University
Medical Center found that at least one-third of the Global Fund’s $4 billion in grantmaking in a normal year
goes toward; activities that strengthen health security.11 This makes it the world’s largest multilateral sourceof grants to make health systems more resilient and prepared.
Moving beyond preparedness, the Global Fund’s COVID-19 response has resoundingly demonstrated its ability to leverage its ongoing programs to contribute to the emergency response once an epidemic emerges. Since
the spring of 2020, the Global Fund has recalibrated its preexisting arrangements with national governments
and harnessed its global supply chains and procurement systems; its expertise in assessment, monitoring, andFGFJ Issue Brief

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evaluation; and its other unique assets—including its deep credibility in LMICs—for the pandemic response.
This has enabled it to award upwards of $1.4 billion to provide diagnostics, PPE, medical oxygen, and othervital support to countries battling COVID-19.12 Plus, it currently has another $2.6 billion in funding for these
efforts in the pipeline as well, making it one of the world’s largest multilateral providers of COVID-19 supplies
for the international response.13
There are other advantages to utilizing the Global Fund to help implement the initiatives that are to be fundedby the proposed PPR financing facility. First, since the Global Fund already invests large sums in “dual use”
preparedness activities, channeling additional money through the same institution to scale up those activities
to the levels envisioned by the three commissions can help ensure that these parallel efforts are properly coordinated, avoid duplication, and minimize the program planning and grant reporting burden on recipient
countries.
Second, utilizing an existing institution like the Global Fund that is already actively working on the country
level is the best way to ensure that an emergency response can quickly be scaled up when needed. As the
COVID-19 pandemic has taught us, the safest way to make certain that institutional machinery and personnel are ready to respond quickly is to avoid leaving them “on the shelf,” but rather to ensure they are actively
used in peacetime as well. In other words, muscles need to be regularly exercised or they atrophy. Integrating
pandemic response capacity into ongoing health programs for infectious diseases, such as those operated by
the Global Fund, is the most effective way to make sure it is ready to scale up during the next crisis.
Third, the Global Fund also tends to be one of the most cost-effective vehicles for deploying funding. Its operating expenses are lower than every other comparable global health organization, topping out at 5.4 percentof the Global Fund’s total budget, in comparison to management fees ranging from 7.0 percent to more than
15 percent elsewhere.14
Fourth, the Global Fund can help to align the ‘health security’ mission of a PPR financing facility with the aimof health systems strengthening and advancing universal health coverage (UHC). Its Country Coordinating
Mechanisms (CCMs) and its other practices have enabled it to establish networks not only with health ministries and other national agencies in LMICs, but also with local-level agencies, nongovernmental organizations, and community groups that help ensure that its funding serves the broader aim of strengthening healthsystems. The Global Fund has also had to develop sophisticated methods of engaging communities living in
extreme poverty and hard-to-reach, stigmatized populations—ethnic minorities, sexual minorities, migrants,
remote communities, and people operating in the informal economy—which often are the first to get sick andthe most likely to incubate new pathogens that go undetected for longer periods of time. Plus, it is accustomed
to operating with the mindset of using disease-specific funding to advance UHC, designing its programs tostrengthen healthcare workforces, systems, and institutions at the country level in a holistic manner that better
equips them for a broad range of health interventions.
Finally, there may be diplomatic benefits to engaging the Global Fund in the PPR financing facility’s work.
The COVID-19 pandemic has intensified global inequality, and there are widespread perceptions that theinternational response has been marred by nationalism and selfishness on the part of the world’s richer countries. Unsurprisingly, criticism of a new institution that may be dominated by donor countries’ interests inprotecting their own populations is already being voiced by advocates for LMICs. This makes it even more
important to have LMICs’ full political support for the new facility in the G20 and other forums, just as it willbe crucial to sustain their active participation in its work to ensure its programming is truly effective. Linking
the new institution to the Global Fund, which nurtures broad local engagement through the use of its CCMs,
could help deepen LMICs’ sense of shared ownership, countering this criticism. Also, formally involving the
Global Fund can help to reassure LMICs that the PPR financing facility will supplement efforts to deal with

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the other diseases that regularly take such a large toll on their citizens—HIV/AIDS, tuberculosis, and malaria—rather than divert resources away from them.
Starting with the UN General Assembly meetings and a potential pandemic summit in September, followedby the G20 Summit and a special meeting of the World Health Assembly, the autumn of 2021 will be a decisive
period for the debate over which vision for a new PPR financing facility will prevail. It seems almost certainthat some sort of facility will be launched, most likely along the lines of the HLIP or IPPPR proposals, but thequestion remains as to whether it can be designed in a way that allows it to operate with sufficient flexibility
and efficacy, how it can avoid spurring greater competition and siloing of efforts in the field of global health,and if it can garner enough political support—and financial backing—to allow it to live up to the world’s highexpectations.
Author: James Gannon, Senior Fellow, JCIE/USA
NOTES

1. Gita Gopinath, “A Long, Uneven and Uncertain Ascent,” International Monetary Fund (October 13, 2020),
https://blogs.imf.org/2020/10/13/a-long-uneven-and-uncertain-ascent/.
2. Congressional Budget Justification: Department of State, Foreign Operations, and Related Programs (Fiscal Year 2022), 77,www.state.gov/wp-content/uploads/2021/05/FY-2022-State_USAID-Congressional-Budget-Justification.pdf.
3. Independent Panel on Pandemic Preparedness and Response (IPPPR), COVID-19: Make it the Last Pandemic,
https://theindependentpanel.org/mainreport/.
4. Pandemic Preparedness Partnership (PPP), 100 Days Mission to Respond to Future Pandemic Threats – A Report to the G7by the Pandemic Preparedness Partnership, www.gov.uk/government/publications/100-days-mission-to-respond-to-future-		
pandemic-threats.
5. High Level Independent Panel on Financing the Global Commons for Pandemic Preparedness and Response (HLIP), A Global
Deal for Our Pandemic Age, https://pandemic-financing.org/report/foreword/.
6. HLIP, A Global Deal for Our Pandemic Age, 52 and 57.
7. One would also be justified in questioning whether donor countries will make good on commitments to contribute massive
amounts of funding once a crisis begins, as the PPP proposal assumes, whether donor countries’ domestic roles and politics
will allow them to make the kinds of “legally binding” 10-year funding commitments that are intended to serve as collateral
for the IPPPR’s proposed facility to issue $50–$100 billion in bonds, or if the World Bank can really come up with a large
enough financing window when a pandemic hits, as envisioned by the HLIP plan.
8. PPP, 100 Days Mission to Respond to Future Pandemic Threats, 58.
9. HLIP, A Global Deal for Our Pandemic Age, 23.
10. Ibid.
11. Matthew R Boyce et al., “Global Fund Contributions to Health Security in Ten Countries, 2014–20: Mapping Synergies
between Vertical Disease Programmes and Capacities for Preventing, Detecting, and Responding to Public Health 		Emergencies,” Lancet Global Health 9(2): e181–88, www.thelancet.com/journals/langlo/article/PIIS2214-109X(20)30420-4/
fulltext. Also, see Friends of the Global Fight, “How the Global Fund Contributes to Health Security,”
https://www.theglobalfight.org/how-the-global-fund-contributes-to-health-security-infographic/.
12. Global Fund to Fight AIDS, Tuberculosis and Malaria, “C19RM Monthly Update to the Board” (June 23, 2021),
www.theglobalfund.org/media/11136/covid19_2021-06-24-board_update_en.pdf.
13. Ibid.
14. Global Fund, “OPEX Evolution 2020-2022 OPEX Cap” (May 11, 2021), 7,
www.theglobalfund.org/media/10994/bm45_02-annex2-opex-evolution2020-2022-budget-cap_report_en.pdf.

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FGFJ raises awareness and builds support for the work of the Global Fund to Fight AIDS, Tuberculosis andMalaria, encouraging greater Japanese participation in addressing the global crisis posed by these deadly
diseases. The Japan Center for International Exchange (JCIE) launched this private initiative in 2004 andhas operated it as a JCIE program since that time.
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