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Monday, March 4, 2024

Guest: Return on Investment for Research and Development

Nobody likes giving something for nothing. It stands to reason that governments seek out investments that deliver returns for their people. When these returns are intangible and non-monetary, they are difficult to quantify and interpret as returns — lives saved or quality of life improvements, for example. It might seem particularly less fruitful when these intangible returns are realized abroad. Revenue generated domestically for the benefit of citizens, especially in such volatile and uncertain times, feels more effectual. Under these assumptions, it makes sense to concentrate investment within the United States. We can’t afford to be spending large amounts of hard-earned taxpayer money on the health of people half a world away. Or can we?

What if you knew that the amount Americans spend on global health research and development pales in comparison to what we spend on domestic health, military or education? And what if this global money actually came right back and generated revenue here in the U.S.? And what if you knew that this research and development saved millions of lives around the world, stopping epidemics and also keeping Americans safe?

The private sector can’t pick up the slack if the U.S. refuses to contribute. We can save millions of lives while generating returns on investment for our citizens. What could be more American than that?

President Donald Trump has spoken often about Americans getting “bad deals,” about other nations taking advantage of our power and generosity. Considering the administration’s “America First” doctrine, it came as no surprise that, in the president’s proposed budget this past May, he drastically cut funding for diplomacy, foreign aid and global health. In accordance to his guiding principle, he proposed a plan with much higher funding for military and border protection, but less for scientific research and foreign projects.

This hangs global health efforts out to dry. Bill Gates, the co-founder of the Gates Foundation, the largest charity in the world, recently warned that a sudden drop in aid from a developed nation cannot be made up by the private sector.

“We don’t have some special stash that we keep in case some government is less generous,” Gates said. “We’re spending at our maximum capacity because we know that every $1,000 we spend, we’re saving an additional life.”

Some of the most ambitious and successful public health programs the world has ever seen, such as The President’s Emergency Plan for AIDS Relief and The Global Fund to Fight HIV, Tuberculosis and Malaria, would be hamstrung by these cuts, causing millions — literally millions — to die. Take a moment to consider that number.

Wherever your opinion of foreign aid, the U.S. has been a trailblazer and generous donor for decades. Organizations and health programs have come to rely on, expect and build programs based on this assumption. They now find themselves having made promises they may not be able to keep.

Surprisingly, however, investments in global health research and development may not be such a bad deal for Americans after all. Recent findings from Global Health Technologies Coalition and Policy Cures Research demonstrate that 89 cents for every dollar spent by the American government on global health research and development was spent in the U.S. Additionally, each dollar spent by the National Institute of Health generates $8.38 in industry investment during the following eight years, meaning that in 2023, “the U.S. government’s 2015 investment in global health basic research alone will spur nearly $4 billion in additional industry R&D investment for global health that would have not happened independently.”

In 2015 alone, the U.S. spent $1.05 trillion on Medicare and health, $609 billion on the military, and $102 billion on education. But in the eight-year period between 2007 and 2015, the U.S. spent only $14 billion on global health. That averages out to around $1.75 billion each year. Global health research and development is a comparatively miniscule part of the federal budget, yet it delivers big returns, whether you consider the monetary return on investment, or the number of lives saved and the quality of life created.

The U.S.’s greatness lies both in its service to its citizens and its relationship with the rest of the world. Championing global health is not only a humanitarian move to be proud of, but also a way to deliver for the American people.


Written by: Brynna Thigpen


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