Laboratories are a fundamental component of health systems, critical in routine and emergency contexts for both disease surveillance and health services for communicable and non-communicable diseases. Investing in laboratories helps countries to create integrated and resilient health systems, achieve national and international health targets, and have responsive and holistic reactions to health crises. Chronic low investment in labs has left vulnerabilities in African countries which come to light during crises like the COVID-19 pandemic, where most policy makers were left “flying blind,” unable to accurately track epidemics in their own countries.
But how much investment is the right amount? And which investments should be prioritised? To decide this, countries must closely consider the benefits and costs of that investment, going beyond initial costs and direct benefits to patients. In addition to country decision makers, international donors may consider investing in labs, for example the new Financial Intermediary Fund (FIF) for pandemic prevention, preparedness, and response will need to decide how best to support African countries. Lab system strengthening should be a contender. Africa CDC and the International Decision Support Initiative (iDSI) have developed a paper which outlines a framework to assist with these considerations, detailing the complex costs and benefits of strengthening laboratory systems within and across national borders.
The full benefits of labs investments go well beyond better treatment for patients with a correct diagnosis
The paper outlines benefits at the patient level, the public health level, and the health systems level. At the patient level, increased diagnostic capability improves health outcomes particularly for communicable diseases and infections, where the potential for rapid patient deterioration due to diagnostic error is more acute. Diagnostics also help shape care pathways by capturing data to develop context specific strategies. For example, the transition from using interferon drugs (Peg-IFN) as antivirals for hepatitis C treatment in many African countries was due to the identification of a genotype commonly found in individuals with African ancestry which was associated with a significantly reduced response to Peg-IFN therapies.
Figure 1. Mapping the benefits and costs of laboratory and diagnostics investments
At the public health level, labs not only reduce overall population mortality and disease burden, but also help prevent, predict, respond to, and mitigate disease outbreaks. In turn, stronger disease surveillance improves disease control strategies, facilitates monitoring of health threats and when the data is disaggregated, can support strategies to improve health equity. Accurate detection of threats is essential for low-income countries where underestimation of threats can be substantial. For example, estimates suggest reported COVID-19 deaths in some low-income settings have represented as low as 10 percent of true deaths, compared to upwards of 75 percent in most high-income countries.
Further benefits are even wider reaching, to health systems and beyond. Firstly, laboratories are essential to harness better disease data for decision making, allowing countries to move away from generic epidemiological modelling, or relying on extrapolations from high-income countries. For example, the much-reported figure of 700,000 deaths from antimicrobial resistance (AMR) first calculated through extrapolation from US deaths, is now recognised as an underestimation, with more recent estimates increasing it to 1.27 million deaths per year. Secondly, diagnostic capability is critical to galvanise towards international benchmarks for targets on health outcomes, for example a quarter of the indicators in both the World Health Organisation Universal Health Coverage (UHC) and Sustainable Development Goal frameworks https://unstats.un.org/sdgs/indicators/indicators-list/ need laboratory capacity, including for mortality, TB and HIV.
Capital and recurrent costs of lab investments can be high
Ongoing investment is required for many of these beneficial outcomes to be realised. While initial capital investment costs can be high, laboratories require ongoing expenditures, for operating, maintaining, and upgrading. The impacts of lack of maintenance have been well documented, from instrument malfunctions, delayed servicing, and outsourced suppliers for commodities. In resource-limited settings, nearly a third of direct laboratory expenses are spent on activities needed to maintain capacity often requiring up to $600,000 per year, per lab, for quality maintenance alone. Less directly, additional costs could also arise from an overreliance on diagnostic tools or any subsequent misdiagnosis.
Sustainability of labs investment must be considered from the outset as progress may be slow and difficult to quantify, which can jeopardise impact assessments and future commitments. Even with increased access, actual uptake in low-resource settings may take years without investments to overcome other delivery barriers, including weak health systems to facilitate appropriate usage, insufficient national policy prioritisation, and limited delivery mechanisms.
This paper proposes a framework to assess the value generated by investing in laboratory and diagnostics capability, which can be used by decision-makers when considering and appraising labs investment. The holistic framework highlights that investing in laboratory systems has the potential to yield considerable and wide-ranging benefits but requires comprehensive long-term financing. This does not mean that all labs investments will be value for money but does mean that economic evaluations which only consider the direct benefits and costs are severely limited.
Crises like the COVID-19 pandemic can provide a window of opportunity to encourage high-impact, long-term investments, including the usage of collaborative cross-sectoral financing strategies. Several recommendations for stakeholders investing in laboratories emerge from this paper.
- National, regional, and international decision-makers should look for opportunities to invest in laboratory and diagnostics services in African countries.
- Specific strategies should be informed by appropriate and available evidence, while still reflecting the wider holistic scope of costs and benefits.
- Investments should be sufficiently comprehensive across health sectors and be sustained long term to yield and maximise these wider benefits.
- Unique financing partnership approaches should be considered to reflect and address the disproportionate costs borne by different stakeholders.
- Investment objectives should focus on moderate- and long-term returns, with monitoring structures which are more indicative of development progress.
In summary, laboratory and diagnostics services are clearly foundational to a well-functioning health system, yet taking too narrow a perspective when considering the costs and benefits of labs systems investments could easily underestimate both the true value and the necessary financing. Decision makers should consider investing labs but should be careful to do so in a holistic way.
CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.