How to address Alzheimer’s disease and support healthier ageing

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This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: David E. Bloom, Clarence James Gamble Professor of Economics and Demography, Harvard School of Public Health, Nathaniel Counts, Senior vice president for behavioral health innovation and clinical assistant professor, Mental Health America and The Department of Psychiatry and Behavioral Sciences at the Albert Einstein College of Medicine, Arindam Nandi, Associate II, Population Council, Daniel Tortorice, Associate professor in the Department of Economics and Accounting, College of the Holy Cross, Daniel Vigo, Assistant Professor, University of British Columbia


  • Alzheimer’s Disease and Related Dementias, also known as ADRDs, present one of the greatest challenges for what the UN has declared as “The Decade of Healthy Ageing”.
  • There is both an ethical and an economic imperative for the global community to mitigate the impacts of ADRDs.
  • Treatment research and development (R&D) presents a remarkably underfunded opportunity to produce far reaching societal benefits.

We have entered what the United Nations (UN) has declared “The Decade of Healthy Ageing”. This declaration and the collective goals set for the next ten years respond to the growing global population over age 60, most of whom are not receiving the support they need to flourish. This call to action is situated within a larger movement to address discrimination against older adults. It is to affirm the dignity and value of individuals of all ages, as a core domain of global health equity.

The ‘Decade of Healthy Ageing’ is also framed as an economic imperative. A recent UN report on “ageism” found that the stigmatization of older adults and the low priority accorded to their needs creates billions of dollars in losses for the US alone. These findings support the notion that older adults offer a longevity dividend – as life expectancy and the elder population share increase, ensuring the wellbeing of older adults becomes increasingly economically valuable and an important contributor to equitable global economic growth.

ADRDs present one of the greatest challenges in the ‘Decade of Healthy Ageing’

Alzheimer’s Disease and Related Dementias (ADRDs) start to develop during midlife and usually go undetected until symptoms surface. ADRDs invariably lead to loss of function and death, and were ranked as the 6th highest contributor to the burden of disease for older adults in 2019 and will likely grow in the coming decades. They also entail high healthcare and social spending as well as informal caregiver burdens, with one recent study estimating that the annual global cost of dementias was $1.33 trillion as of 2020 and will double every decade, reaching $9.12 trillion in 2050.

Despite the large and growing health and economic burdens, there are no therapies available that significantly modify the disease process. While there are supports that can substantially improve quality of life and decrease caregiving burden, as well as promising strategies for preventing the onset of ADRDs, there are no truly effective pharmacological treatments. This occurs in part because of the disease complexity, but also because of underinvestment arising from the same ageism that the ‘Decade of Healthy Ageing’ seeks to address.

The global community must invest to mitigate the impacts of ADRDs as part of both the ethical imperative against ageism and the economic imperative to unlock a new form of demographic dividend. Preventing ADRDs and improving quality of life for people with ADRDs through well-tested strategies are areas that need stronger investment.

The focus of this will be on treatment R&D (research and development), since it presents a remarkably underfunded opportunity to produce far reaching societal benefits.

Free rider problems and misallocation of risk in R&D for ADRDs

R&D for ADRDs faces two distinct problems: first, the basic knowledge created by R&D is difficult to patent and consequently private markets will chronically underprovide it. Second, even for investments that lead to patentable outputs, the extreme riskiness of the returns to ADRD R&D discourages private investment, given its limited capacity to absorb risk. Both problems are amenable to economically sound government intervention.

The knowledge produced by basic research is a global public good, as the private sector cannot reap the full rewards of basic research. As with other public goods, the private sector will always produce too little relative to the potential global benefit. This makes robust public investment in R&D a necessity.

To address this, collaboration among well-resourced actors could develop a global ADRD R&D ecosystem that is free for all to use. This would increase equity in who can participate and accelerate R&D globally. The COVID-19 pandemic demonstrates this principle – investing to build strong infrastructure for collaboration can lead to new discoveries at an incredible pace. ADRDs poses a different R&D challenge than COVID-19, but it also requires coordinated global investment.

The other factor necessitating public intervention is the extreme riskiness of ADRD therapeutic development. Clinical trials for ADRDs have had low success rates: as of 2017, there were 146 Alzheimer’s Disease clinical trials that failed and 4 that resulted in approval by the U.S. Food and Drug Administration, while the success rate of drug development programs in general is 13.8%. This high risk at the discovery stage disincentivizes investing in individual clinical trials.

Several innovative financing mechanisms are being developed to ameliorate this problem. For example, Andrew Lo at MIT recommends the development of a megafund – a portfolio of clinical trial investments – as a financial vehicle that allows investors to reduce risk by spreading investment over a diverse array of potential treatments Others have recommended innovative “pull” financing mechanisms by which purchasers pre-specify a price they would be willing to pay for successful therapies, decreasing the uncertainty around how it would perform in the market and increasing interest in investment.

Finally, ADRDs present a disproportionate threat in less well-resourced nations and among populations that face discrimination, as ADRDs’ risk factors are associated with lower resource access. For new therapies to reach these populations and promote global health and economic equity, better resourced actors will need to subsidize these costs.

Recommendations toward addressing ADRDs for a decade of healthy ageing

ADRDs must be addressed as part of the economic, health equity, moral, and human rights imperatives of the ‘Decade of Healthy Ageing’. In particular, the R&D challenges in therapeutics for ADRDs can be overcome through global collaboration toward the development of two critical new public goods: an active and well-structured ADRDs R&D ecosystem and innovative financing mechanisms.

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