US DFC launches new health investment initiative

WASHINGTON — The U.S. International Development Finance Corporation has launched a new initiative aimed at ramping up the agency’s focus on and funding for health investments, particularly those that foster global health resilience.

The Health and Prosperity Initiative seeks to invest some $2 billion over the next three years and catalyze about $3 billion in private financing alongside its efforts.

The Overseas Private Investment Corporation, DFC’s predecessor, also invested in health, with about 10% of its portfolio going to public health investments in areas including health care delivery, maternal health, and water, sanitation, and hygiene projects. But its role in health “was certainly smaller” than DFC’s, said Edward Burrier, executive vice president for strategy at DFC.

When Adam Boehler, who founded and led a health care company prior to joining the government, came on board as CEO of DFC, it was part of his vision to “really ramp up our efforts in the health space,” Burrier said. To that end, DFC hired Nafisa Jiwani as managing director for health initiatives.

Jiwani, who has a public health background, said that the COVID-19 crisis provides an opportunity to transform the traditional way that global health has been financed, which has primarily been through aid and grants.

“By involving the private sector, we can complement those aid efforts to promote sustainable investments around preparedness and health care delivery. And I'm hoping that will then help build resilience needed in developing contexts to prevent future outbreaks,” she said.

Through the initiative, DFC will invest between $5 million and $500 million per project. It will use a range of its investment products in medical technologies, digital health, supply chain financing, manufacturing of health supplies, pharmacies, and pharmaceuticals, in addition to WASH and food security, said Jiwani, who is leading the effort.

The initiative was in the works before the pandemic, but its importance has only been amplified. It will focus — at least initially — on opportunities that can help in the response, including around supply chains for diagnostics and eventual therapeutics and vaccines, she said.

While there are investment opportunities out there, health companies have not necessarily seen OPIC or DFC as investors in the space, Jiwani said, so DFC has been trying to build relationships and partnerships to create awareness that it can provide financing. DFC is also working closely with other U.S. agency partners that work on global health, especially the U.S. Agency for International Development, to collaborate around potential investments, she said.

The initiative will prioritize investments in Africa — as noted in the call for proposals — partly because many of the countries on the continent need the most investment in building resilient health systems. Africa is also where there are more U.S. government partners working on health, Burrier said.

While it is unclear how quickly DFC will close its first investment through the initiative, it is aiming generally to speed up its response to COVID-19 and deliver financing, particularly to existing partners, more quickly. The agency is working with its board to develop a system that would allow it to more rapidly deploy capital to those partners.

DFC will hire an additional four to six employees to help process deals related to the coronavirus response, under an Office of Management and Budget directive that allows agencies to use an expedited process to hire for the response to the virus.

The expansion of the health portfolio should not come at the expense of other efforts, in part because there are opportunities to work with other agencies to share resources, Burrier said.

While there is now a clear focus on the pandemic, Jiwani said she wants to be sure the initiative looks at health care resiliency beyond this crisis and invests in a variety of areas, including noncommunicable diseases.