APEC Life Sciences Innovation Forum (LSIF) Project

Established by APEC Leaders in 2002, the Life Sciences Innovation Forum (LSIF) has since grown to become APEC's leading initiative on health and health sciences innovation. It is a tripartite forum that engages representatives from the highest levels of government, industry and academia to create the right policy environment for life sciences innovation.

In 2003, Peter Sheehan was given the role Co-Chair (Academic) of the LSIF. The CSES has prepared framework papers for the LSIF meetings over several years (see Research Reports section).

A report prepared in 2008, in conjunction with Professor Xiaoying Zheng of Peking University, on the economics of a large increase in health investment in developing countries is titled Investing in the Future: An Assessment of the Returns to Investment in Health Innovation, was discussed at the LSIF meeting in Lima, Peru in 2008 and in Singapore in 2009; its conclusions were endorsed by the APEC Leaders in Santiago in late 2008.

Streams of work on this project are:

• Progress report at Sendai.
• Extended report for Expert Group meeting in Beijing, December 2010, with some special emphasis on the application to China and other developing economies.
• China case study.
• Presentation at LSIF IX in the US.

1. The Role of Health in Rebalancing Asian Economies

There is a substantial literature on the need to rebalance many Asian economies, especially those in East Asia. It is becoming increasingly realised that there are various forms of imbalance – in terms of savings and investment, reflected in a current account surplus; in terms of excess energy use and pollution, linked in part to excess investment in heavy industry and construction; and in terms of inadequate spending (both public and private) in welfare-generating services, especially health. The first two forms of imbalance are both connected to low spending on health and other services, so that much increased attention to health would be part of the process of addressing the other two forms of imbalance. Attention is being given to developing this approach further, in part as a way of linking LSIF’s concern with the questions of imbalance that are of great interest to health officials.

2. Understanding the Current Epidemiological Transition in Developing Economies

As part of the process of extending the study to include communicable as well as chronic diseases, the whole question of the epidemiological transition is being re-examined. Two potential ways in which the current transition may differ from that of advanced countries are being documented further: the speed and scale of the rise in chronic diseases in various developing economies, and the extent to which this rise overlaps with a continued burden of communicable diseases. Better understanding here will help define further the nature of the challenges that developing economies actually face.

3. The Benefits of Health Innovation: Cardiovascular Disease

Cardiovascular disease is an area in which, for advanced countries, both the reduction in mortality and the role of health innovation in that reduction are well documented, and hence in which the net benefits of investment in health innovation are very clear. It is also an area in which many developing economies face major challenges, as the populations at risk of cardiovascular disease rise rapidly. A case study in this area is being developed, initially by review and analysis of the extensive literature on the topic, but perhaps in due course by a new analysis of the data. Special attention is being given to China, with a view to the future study on China.

4. The Benefits of Health Innovation: The Use of Vaccines

While a new cost-benefit analysis of any vaccines is not being undertaken at this stage, it seems that some powerful results about the value of vaccines may be able to be assembled from a wide range of existing studies. These studies are being reviewed to this end, and as a basis for more specific analyses of vaccines in later stages of the project.

5. The Fiscal Implications of Health Innovation: Some Case Studies

Data are being assembled on long run fiscal indicators for a number of countries, including financial variables relevant to health, with a view to assembling for one or more countries a trial model of the implications of increased health innovation on the Government’s budgetary position in the long term. It is unclear at this stage if any base models are available, or whether each model will need to be constructed from the available data.

6. The Impact of Better Health on Economic Output: Evidence from the Macro Economy and the Workplace

Two matters are being examined here, to strengthen and extend the benefits aspect of the model. One is the macroeconomic literature on health, productivity and GDP in the long run, which contains a number of results which may be valuable in extending the model. The other is workplace and firm specific studies on impact of better health on attendance, productivity and effective labour costs to the employers. Again there is valuable literature and some firm-specific data may be provided.

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