aneo17 WHO to Allocate More Funds o Fighting Malaria | Management Consulting Case Interviews Management Consulting Case Interviews ‘Wiekome deopdish? Log aul WHO to Allocate More Funds to Fighting Malaria Case Type: investment. Consulting Firm: Boston Consulting Group (BCG) first round full time job interview. Industry Coverage: healthcare: hospital & medical; non-profit organization. Case Interview Question #00896: Our client is the World Health Organization (WHO). The WHO is a specialized ‘agency of the United Nations that is concerned with international public health. It was established in April 1948, headquartered in Geneva, Switzerland. Since its creation, the WHO has played a leading role in the eradication of smallpox. Its current priorities include communicable diseases, in particular HIVIAIDS, Ebola, malaria and tuberculosis. Each year the World Health Organization receives USD $2.5 billion in grants to reduce the incidence of disease in developing nations. Every year, they allocate 20% of this budget to fighting malaria. 80% of their malaria budget goes toward R&D and 20% to onsite implementation. ‘A few facts about malaria: Approximately 50% of the world's countries are considered “at risk’, which means malaria is common among the population. The biggest problem is in Sub-Saharan Africa. In this region, the disease has a 40% incidence rate among chil iren under the age of 5, However, children who live past the age of 5 usually acquire immunity to the disease by this stage of their life. Itis early 2016, and the WHO malaria team has just found out that for this year, and this year only, their budget will be increased by 20%. These additional funds could be invested into the purchase and distribution of bed nets, or they could be used to further R&D on a malaria vaccine with a robust pipeline. The team is equally divided between these two options and has brought Boston Consulting Group (BCG) in to help them decide how to invest the additional funds, What would you recommend? Possible Answer: Note: While drawing their structure, the candidate should have already calculated that additional malaria team funds amount to $2.5 billion * 20% * 20% = $100 million. The key to the case is to compare each option and determine: which can save the greatest number of lives. Impact on the number of lives saved should be included in the candidate's structure. Part 1: Sub-Saharan African demographics ‘Additional Information: the following information can be provided if requested by the candidate, + Total population of Sub-Saharan Africa is 800M, + Average life expectancy is 50 years. + Roughly 10% of the population falls into the 0-5 age group. Behind the Scenes: The candidate can calculate the population of the 0-5 age group in one of two ways. If they ask for the percentage, then they can simply multiply 800M by 10% to get 80M children aged 0-5 years old. If they ask for life expectancy, they can divide 800M by 50 years, and then multiply by 5 to get 80M Part 2: Determining the benefits of bed nets Behind the Scenes: Once the candidate has the above information, they should move to evaluate the impact of investing in either bed nets or the malaria vaccine. It does not matter which they start with, but they should be clear that they wish to do a side-by-side comparison before the following information is provided. hitpakwaw.consutngcaset01 com who-to-llocate-marefunds-o-Aghtng-malaia! 48aneo17 WHO to Allocate More Funds o Fighting Malaria | Management Consulting Case Interviews Candidate: I'd lke to start by evaluating the bed nets, Do we have any information on how effective bed nets are? Interviewer: There are two factors that contribute to the usefulness of bed nets. Efficacy is 40%, which is the frequency with which they yield the desired result. There is also a compliance rate, which is the frequency that the bed nets are actually used. The compliance rate is unfortunately only 50% because once they are distributed families often use them for other purposes or don't use them at al. Candidate: Do we know how much each bed net costs? Interviewer: They are $5 each. That includes everything — purchase from the manufacturer, shipping, and distribution Candidate: OK, so $100M divided by $5 = 20M bed nets Key Insight: The candidate should note that 20M bed nets is only enough for 25% of 0-5 year old population (80M). Candidate: 20M bed nets * 40% efficacy * 50% compliance rate * 40% incidence rate = 1.6M cases averted. How long do bed nets last? Interviewer: They last for 2 years. Candidate: OK, 2 years * 1.6M cases averted equals a total of 3.2M cases of malaria averted if we invest the $100M into bed nets, Part 3; Determining the benefits of vaccine R&D Candidate: What information do we have about the vaccine pipeline? Interviewer: The vaccine will be ready for launch 4 years from now. Candidate: Do we know the efficacy and compliance rates for the vaccine? Interviewer: Studies show that the vaccine will have an 80% efficacy rate, Can you tell me your intuition about the compliance rate? Candidate: Sure. How would the vaccine be administered and in how many doses? Interviewer: The vaccine can be taken orally and only a single pill is required, Candidate: Compliance rate would likely be close to 100% then since clinicians can ensure that the pill is taken properly and the patients do not need to return for additional doses. Do we have any information about how much the vaccine will cost? Interviewer: The cost is $30 per vaccine, but our $100M investment will only cover research and development (R&D) costs. However, if we fund the research, another organization, Bill & Melinda Gates Foundation, has agreed to ddonote an additional $150M dedicated to the production and distribution ofthe vaccine Candidate: $150M / $30 = 5M doses of vaccine. 5M doses * 80% efficacy * 100% compliance * 40% inci jonce = 1.6M cases averted Key Insight: The candidate should realize that because the vaccine provides lifelong protection, more cases could be averted if the vaccine is administered when children are younger. If the candidate asks, the vaccine can be administered safely when the child is as young as one year old. The vaccine will then protect them for an additional 4 years of their life while they are still susceptible to the disease, so 1.6Miyear is multiplied by 5 years to get a total of 8M cases of malaria averted. hitpakwaw.consutngcaset01 com who-to-llocate-marefunds-o-Aghtng-malaia!