Every dollar spent on COVID-19 vaccine development and distribution generated an estimated $59.70 to $809 in economic value during the first year that vaccines were given, according to new research published in the journal PLOS Medicine .
The study—the first global analysis of the return on investment for COVID-19 vaccines—shows that vaccines not only averted severe illness and saved lives, but were also a sound investment.
"Our study provides evidence that the unprecedented, rapid investments made into COVID-19 vaccines early in the pandemic paid off massively both in health and economic benefits," said study author Mark Jit , professor of global health at NYU School of Global Public Health. "Vaccine development, as well as equitable vaccine distribution globally, should be prioritized before and during global health crises."
Vaccines played a critical role during the COVID-19 pandemic, but their development required extraordinary effort—and spending—among governments, pharmaceutical companies, and nonprofit organizations.The resulting vaccines were highly effective at preventing severe illness and death, with one study estimating that between 14 and 20 million deaths were averted in the first year that vaccines were available.
Despite their health impact, the economic value of these vaccines has not been examined on a global scale. Moreover, most analyses of the cost effectiveness of immunization look at the cost of purchasing the vaccine itself from its manufacturer, not the development of it.
"With other vaccines, a company takes on the risk by investing its own money to develop a vaccine. But the COVID vaccine was not purely a private sector decision—the US, the European Union, and other countries like China poured substantial funding into this to reduce the risk for vaccine companies," said Jit. "We wanted to understand how these costs compared to health and economic outcomes."
To measure the impact of this investment, the researchers evaluated the economic value of COVID-19 vaccines during the first year that vaccines became available (December 8, 2020-December 8, 2021), when they had the greatest impact due to people having limited immunity to the virus.
Using data from 173 countries, the researchers compared the costs of vaccine development, manufacturing, and delivery with health and economic measures related to the vaccine. This included years of life gained, quality of life measures from avoiding hospitalizations and deaths, work productivity, and averted health care costs. The researchers then used two different methods to quantify the value of saving lives and improving health: a cost-benefit analysis commonly used in the public sector, as well as a cost-effectiveness analysis used in the health sector to quantify savings based on what would be spent in health care to save someone's life.
Overall COVID-19 vaccine development and delivery worldwide cost $79.4 billion, but the health and economic benefits of vaccination were valued between $6.43 trillion and $64.3 trillion, translating to a return on investment of $59.70 to $809 per dollar spent.
"While developing and rolling out these vaccines at unprecedented speed required substantial upfront investment, the health and economic benefits far outweighed the costs within just one year," said Hallie Benjamin, lead author of the paper who worked on the research as a MSc Public Health student at the London School of Hygiene & Tropical Medicine (LSHTM).
The researchers found significant disparities in the vaccine's return on investment across countries, with high-income countries benefitting more than low- and middle-income countries. High-income countries gained the greatest economic benefits due to early access, higher uptake of vaccines, faster rollouts, and older populations who were at risk for severe outcomes.
In contrast, many low- and middle-income countries didn't have widespread access to the vaccine until late 2021, after many people had already contracted COVID-19 and developed some immunity. Despite this, low-income countries still had the highest averted health care and productivity costs relative to their own economies and populations.
"The lesson is there should be a way to get this vaccine to countries that need it faster. Because of the delays, it wasn't as useful to many of those countries as it could have been," said Jit.
The authors note that the study does not examine the economic benefit of COVID-19 vaccines beyond their first year, when rates of infection were lower and most people had developed some immunity. But in the face of a new viral threat, the findings show that rapidly investing in vaccine development can safeguard public health and preserve economic stability.
"By preventing billions of infections and millions of hospitalizations and deaths, the vaccines generated enormous value for societies and economies worldwide. However, our research also shows that these benefits were not shared equally between higher- and lower-income countries, highlighting the importance of equitable and timely vaccine distribution. Through studying these inequalities, we hope our findings can help guide future research into how vaccination programs can improve health and economic outcomes worldwide," said Benjamin.
Additional study authors include Gregory Barnsley of LSHTM and Oliver Watson of Imperial College London. The study was funded by the UK's National Institute for Health and Care Research Health Protection Research Unit in Modelling and Health Economics, a partnership between the UK Health Security Agency, Imperial College London, and the London School of Hygiene & Tropical Medicine (grant code NIHR200908).
