Assesses the benefits and costs of controlling a pandemic such as the corona virus.

What is it about?

We develop a valuation model of the option to withhold wide use of an antibiotic until significant outbreaks such as pandemic influenza or foodborne diseases are identified. Using real options theory, we derive conditions under which withholding wide use is beneficial, and calculate the option value for influenza pandemic scenarios that lead to secondary infections with a resistant Staphylococcus aureus strain. We find that the value of withholding an effective novel oral antibiotic can be positive and significant unless the pandemic is mild and causes few secondary infections with the resistant strain or if most patients can be treated intravenously.

Featured Image

Why is it important?

Provides with the help of a model the possibility to assess alternative control strategies for pandemics. Important for the current debate on the corona virus.

Perspectives