Economics of HIV/AIDS

From Canning, David. 2006. "The Economics of HIV/AIDS in Low-Income Countries: The Case for Prevention." Journal of Economic Perspectives, 20(3): 121–142:

• . . . [a] dollar spent on prevention is around 28 times more effective in reducing the burden of disease, as measured by illness and premature death [in contrast to treatment] . . . the limited resources available to combat HIV/AIDS in low-income countries should be targeted toward prevention rather than treatment.
• While other criterion can be used for setting priorities, promoting AIDS treatment using antiretrovirals in resource-constrained countries comes at a huge cost in terms of avoidable deaths that could be prevented by devoting resources to prevention interventions that would substantially lower the scale of the epidemic.
• Based on a study of discordant couples (where one partner has the HIV virus, but the other does not) in Uganda, the risk of causing a new infection is highest in the first two and a half months after infection (a transmission risk of 0.0082/coital act) and in the last 24 months of life (0.0028/coital act), with a low of 0.0007/coital act in the middle period (Wawer et al., 2005). While these transmission rates per sex act are low, the cumulative probability of transmission from repeated unprotected sex with an infected partner quickly becomes large.
• Mother-tochild transmission can be dramatically lowered by giving HIV-positive mothers a single dose of nevirapine at the onset of labor and a single dose to the infant at birth. This policy may reduce transmission to below 3 percent at birth.
• The ABC—Abstain, Be Faithful, Use Condoms—initiative in Uganda, combined with a high level of political commitment to HIV prevention, was successful in significantly reducing the prevalence of AIDS.
• Recent evidence from a randomized trial appears to support the beneficial effects of male circumcision in reducing HIV transmission.
• Medeiros, Diaz and Filho (2002) find in a Brazilian study that the average duration of benefits from first-line antiretroviral therapy was only 14.1 months. This finding suggests that a need for second-line antiretrovirals will quickly emerge in Africa, but while drug costs of first-line treatment are now low, with generic drugs being available at a cost of around $175 per year, the costs of the second-line drugs can be ten times higher.
• The major opportunistic infection, and leading cause of death for those with AIDS in Africa, is tuberculosis.
• Brazil is successfully providing universal access to antiretroviral therapy.
•  . . . [f]ocus on prevention in the high-mortality countries of Africa will reduce new HIV infections in the region by around 3.53 million per year, as compared with an estimated reduction of 40,000 a year with antiretroviral therapy.
•  Development of an effective HIV/AIDS vaccine would bring enormous benefits because of the many millions of HIV infections that could be avoided, which justifies large investments even if the probability of success is low.

This is a TED video that examines AIDS stats from an economic point of view.