The COVID-19 pandemic has shed a spotlight on the resilience of healthcare systems, and their ability to cope efficiently and effectively with unexpected crises. If we are to learn one economic lesson from the pandemic, arguably it is the perils of an overfocus on short-term allocative efficiency at the price of lack of capacity to deal with uncertain future challenges. In normal times, building spare capacity with ‘option value’ into health systems may seem inefficient, the costs potentially exceeding the benefits. Yet the fatal weakness of not doing so is that this can leave health systems highly constrained when dealing with unexpected, but ultimately inevitable, shocks—such as the COVID-19 pandemic. In this article, we argue that the pandemic has highlighted the potentially enormous option value of biomedical research infrastructure. We illustrate this with reference to COVID-19 response work supported by the United Kingdom National Institute for Health Research Oxford Biomedical Research Centre. As the world deals with the fallout from the most serious economic crisis since the Great Depression, pressure will soon come to review government expenditure, including research funding. Developing a framework to fully account for option value, and understanding the public appetite to pay for it, should allow us to be better prepared for the next emerging problem.
|Number of pages||4|
|Journal||Health Research Policy and Systems|
|Early online date||1 Apr 2021|
|Publication status||Published - Dec 2021|
Bibliographical noteFunding Information:
This article was funded by the National Institute for Health Research (University of Oxford [NIHR-BRC-1215-20008]). LSJR, PC, VK, HMcS and PMC are supported by the NIHR Oxford Biomedical Research Centre, Oxford. The views expressed are those of the authors and not necessarily those of the NIHR or the Department of Health and Social Care. RD acknowledges support from the grant FONDECYT No1201397. The study funders had no role in the design of the study, in the writing of the paper or in the decision to submit for publication.
HMcS is Director of the NIHR Oxford Biomedical Research Centre; VK is Chief Operating Officer of the NIHR Oxford Biomedical Research Centre;
© 2021, The Author(s).
- Option value
- Research funding
- Research infrastructure
ASJC Scopus subject areas
- Health Policy