Where does the Pandemic Fund stand in its second year?

Just before 2023 closed, the Pandemic Fund, which was created to support pandemic preparedness efforts in low- and middle-income countries, announced a second call for proposals. This time, it’s offering a bigger envelope of half a billion dollars. The demand for financing for the first call for proposals — whose final allocation was $338 million — was “eight times oversubscribed,” according to Priya Basu, executive head of the Pandemic Fund Secretariat. A total of 133 countries applied for funding in the first round, and 19 applicants were awarded grants covering 37 countries. Several experts Devex spoke to commended some of the fund’s work to date, but they also highlighted outstanding challenges and areas the fund needs to overcome and address. These include raising money and unlocking additional funding from domestic resources, and ensuring the meaningful involvement of countries from the global south and civil society. Some of these the fund is already working on, but some require careful consideration. A second call for proposals The fund will continue to invest in early warning and disease surveillance systems, laboratory systems, and the health workforce in its second call for proposals. That decision was driven by huge demand from countries, Basu said. “In designing the second call, we did a quick sort of check in with our developing country constituencies to understand if needs and priorities had shifted … And really what we heard was that there's still a lot of unmet demand for those areas,” she told Devex. In this second round, the fund is putting an emphasis on the role of local communities and civil society. Applicants will need to provide information on how communities and civil society have been engaged in preparing project proposals, and what their role will be in delivery. “That was a good first year, but now it [the Pandemic Fund] really needs to grow and mature to the next stage.” --— Carolyn Reynolds, co-founder, Pandemic Action Network It’s also in the first call, but they’re highlighting it as a requirement “even more boldly” in the second call, Basu said. The 16 countries and territories that received “single country” grants, such as Cambodia and Ethiopia, during the first round aren’t eligible for the same type of grant in the second round. But they can still benefit from multicountry grants, and proposals submitted by regional entities. Many of the projects from the first round of grants are already being implemented, while others are starting soon, such as the Ethio-Pandemic Multi-Sectoral Prevention, Preparedness, and Response Project in Ethiopia, which received the biggest grant allocation from the fund at $50 million and will be launched next week, according to Basu. Dr. Githinji Gitahi, CEO of Amref Health Africa, said some African ministers were disappointed during the first grant allocations, as they felt it favored regional or multicountry applications — although multicountry applications accounted for only 18% of total grants. There’s also some disappointments over the “delay” in approving the Africa Centres for Disease Control and Prevention as an implementing entity, he said. The pan-African health agency previously expressed its disappointment over not being included as an implementing entity despite being well positioned to do so given its role in supporting the continent’s health initiatives. But Basu said the agency could still submit a proposal to receive funding as a regional entity, but it needs to be done jointly with one or more implementing entities. During the first grant allocation, the process to accredit additional implementing entities was still in the works. The fund only opened the applications this month. Applicants will be accepted on a rolling basis, and will be reviewed by the fund’s independent accreditation panel, according to the fund’s spokesperson. Africa CDC has expressed a “strong interest” in applying, according to the spokesperson. Over a dozen other entities have also expressed their interest in serving as implementing entities of the fund. They include multilateral development banks, U.N. agencies, and regional organizations — almost a similar makeup to the fund’s current 13 implementing entities. Selected proposals for the second round are expected to be announced in October at the latest, according to a published timeline. A resource mobilization challenge The Pandemic Fund has raised $2 billion to date. But it’s still short of the estimated $10.5 billion in additional international financing that’s needed for pandemic preparedness annually. The fund is embarking on a resource mobilization strategy to get more resources, and working toward a pledging moment in the last quarter of 2024, the spokesperson said. The fundraising target is still in discussion. But Basu said part of their strategy is to expand their existing donor base and include more donors from countries in the global south countries and philanthropy. In the long term, they expect that strong results from the projects they funded will help. Pandemic Fund grants are meant to be used in three years, and the fund has “explicitly” asked for projects to demonstrate results from the first year of implementation, she said. That can happen as early as next year, she added. But there are many competing asks for resources in the global health space, and elections in different countries could have implications for fundraising. That includes the United States, one of its top contributors. “We're now entering this waning phase of the boom and bust cycle for health security. … The sense of urgency that pervaded the policy discussions a few years ago is no longer there.” --— Josh Michaud, associate director for global health and HIV policy, Kaiser Family Foundation In December 2022, the U.S. government passed a law authorizing up to $5 billion in U.S. contributions to the fund over five years, with a caveat that their contributions should not exceed one-third of all donor contributions. But those familiar with the U.S. budget process said authorization doesn’t always result in funds being appropriated. “Authorizing legislation sets up the mechanism for financing for the fund, and that's important. But it doesn't actually provide the dollars … that's what the budget bills, which are being negotiated in Congress, would actually do. So they may decide to not provide any money. They may provide the full billion dollars. It's still unresolved,” Josh Michaud, associate director for global health and HIV policy at the Kaiser Family Foundation, told Devex. It’s unclear if Republicans were against the fund, but they have been vocal in pushing back on spending on foreign assistance, Michaud said. There have been calls to cut foreign assistance programs, including money for the fund, he said. But Basu is hopeful. “My sense is that the pandemic prevention and preparedness agenda is one that really cuts across aisles, even in the U.S. system,” she said. While there could be changes, and multiple crises happening, “I’m quite confident that we can make the case. Hopefully, people haven't forgotten COVID yet,” she added. A balancing act There are other issues and challenges confronting the fund, such as defining the terms of co-financing and co-investments for the projects it funds. Part of the fund’s mission is for its grants to help unlock additional funding for pandemic preparedness. But Michaud said it needs to consider how this will be implemented in low-income countries or fragile states where budgets are already tight. According to the guidance note the fund published for its second call for proposals, co-financing is required from implementing entities or other funding sources in addition to the grant received from the fund. It can be financial or in kind, although implementing entities “are encouraged” to provide it in financial form. Co-investments meanwhile can come in the form of financial resources or policy commitments from countries and regional entities. Both are “strongly encouraged” to demonstrate financial commitments to the project, but countries with “less ability” to do so could “include plans to leverage national investments and incentivize the use of Multilateral Development Bank country lending for preparedness.” The fund didn’t specify a minimum amount for co-financing and co-investment, but it will be part of the considerations for evaluating project proposals. Basu said the $338 million grants they awarded in the first round mobilized $2 billion in co-financing and co-investments. But most of that came from multilateral development banks, and the bulk of that from the World Bank. U.N. agencies brought in more in-kind contributions, such as technical assistance. “Some of the U.N. agencies don't really have the ability to bring in cash co-financing. That's not the way they work … So by putting some kind of dollar minimum, we may inadvertently … discourage U.N. agencies from coming into projects,” she said. They are similarly concerned that they may discourage low-income countries from applying for grants. Meanwhile, other experts said the fund also needs to enhance coordination with other funds to avoid putting additional burden on countries in applying for grants. The Global Fund to Fight AIDS, Tuberculosis and Malaria, one of the 13 implementing entities, faced this problem during the first call for proposals, which prevented it from serving as an implementing entity. According to a Global Fund spokesperson, they have had constructive discussions with the Pandemic Fund over the past months on the issue. And while the ad hoc nature of the Pandemic Fund’s funding opportunities remains a challenge for alignment with country cycles and Global Fund’s funding allocation model, their engagement “has been positive.” The spokesperson said the Global Fund is “working through operational considerations” and will engage with its committees and board in the coming months to determine if they would be able to serve as an implementing entity of the Pandemic Fund for the second call for proposals. The Pandemic Fund should also ensure meaningful participation of co-investor countries, civil society and the private sector, said Carolyn Reynolds, co-founder of the Pandemic Action Network. There are co-investors and civil society representatives on the board of the Pandemic Fund, “but representation and meaningful engagement are two different things,” she said. There are currently two seats for civil society in the Pandemic Fund board, including two alternates, but Reynolds said they need support to be able to consult with other members of civil society. The same goes for co-investor countries. There needs to be a process for them to be able to come together, share views and arrive at a common position on issues discussed at the board. The fund should also engage the private sector. There’s currently one seat reserved for nonsovereign contributors to the fund, and that seat is currently filled by three big philanthropic organizations and foundations. The private sector can bring in more money and potential innovative financing mechanisms, she said. The fund should also explore different modalities for providing grants, such as a rolling application process, to respond to more urgent funding requests, Reynolds added. “That was a good first year, but now it really needs to grow and mature to the next stage,” she said. Basu said they’re making sure everyone on the board is able to speak and share their views during meetings. But she’s aware it’s an area that needs more work. The board resets every two years, with the next reset scheduled for 2025, serving a new opportunity for countries to organize themselves. Meanwhile, there are many ways the private sector can and is engaging with the fund, such as through public-private partnerships as part of funded projects. They’re also encouraging the private sector arms of multilateral development banks to prepare and submit projects for funding, demonstrating how the grant money will leverage private sector resources, she said. But experts are concerned that the biggest challenge for the fund is beyond its control. “We're now entering this waning phase of the boom and bust cycle for health security,” Michaud said. “And so how do you combat policymaker attention being diverted to other things? The sense of urgency that pervaded the policy discussions a few years ago is no longer there.”