In October 2024 the International Finance Facility for Immunisation (IFFIm) priced a US$1 billion, 3-year fixed-rate bond to fund “critical vaccine research and immunisation programmes”. This is IFFIm’s largest single benchmark transaction in the primary market since its inaugural benchmark in 2006, with proceeds supporting Gavi and CEPI. The bond will mature on 29th October 2027 and carries a semi-annual coupon of 4.125% and a semi-annual re-offer yield of 4.222%.
“The success of this bond highlights the ongoing strength of IFFIm’s model, which leverages sovereign support and strong financial structuring to offer investment opportunities that make a positive impact on children’s health.”
The order book was IFFIm’s largest to date, exceeding US$4 billion. The bond drew interest from a diverse group of investors with geographic spread.
Support for vaccine programmes
IFFIm is an “important flexible tool” for organisations like Gavi; since 2006 it has provided Gavi with US$5.8 billion in financing, one sixth of its overall budget. It has been “critical” in enabling Gavi’s recent emergency responses as well as routine immunisation and health system resilience efforts. Dr Sania Nishtar, CEO of Gavi, reflected that IFFIm has been a “groundbreaking and indispensable tool”.
“Today’s bond issue provides us with vital flexibility in our mission to protect millions of children from preventable diseases and to protect our world from the threat of future pandemics.”
As Gavi nears the end of the 2021-2025 strategic period and prepares for the next phase, IFFIm states that the bond issue will play a “pivotal role” in supporting life-saving programmes.
IFFIm has also provided approximately US$272 million in past financing to CEPI in support of the research and development of new vaccines. Dr Richard Hatchett, CEO of CEPI, acknowledged the “serious threat to global health security” presented by epidemics and pandemics. He commented that these can be “mitigated through investment in vaccine R&D and manufacturing”.
“The IFFIm financing mechanism enables CEPI to access the critical funding it needs to accelerate the development of vaccines against emerging infectious disease threats, for the benefit of all.”
Offering opportunities
IFFIm Board Chair Ken Lay believes that the latest issue “highlights IFFIm’s unparalleled strengths”; it is “backed by sovereign donors, driven by a vital global mission, and structured to maximise impact”.
“IFFIm’s bonds continue to offer investors compelling opportunities to earn competitive returns with good secondary market liquidity and assured use of proceeds.”
Jorge Familiar, Vice President and Treasurer, World Bank commented that capital markets are a “powerful tool for connecting private investment with global public goods”.
“As IFFIm’s Treasury Manager, the World Bank is pleased to support IFFIm in accessing capital markets to provide a long-term and flexible funding source to Gavi to accelerate access to vaccines and vaccine development.”
Head of SSA and EMEA IG Syndicate, BofA Securities Adrien de Naurois congratulated the IFFIm team on a successful return to the USD market.
“Today’s transaction, the first USD benchmark in two years, is a clear demonstration of IFFIm’s loyal and diverse investor base, attracted by the importance of its mission to deliver immunisation programmes to those most vulnerable via the ongoing work of Gavi.”
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