Facts about diabetes 2 and the health bond
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Type 2 diabetes is often referred to as a lifestyle disease, with being overweight, poor diet, stress and lack of exercise as triggering factors. This is also why preventive measures can have great effect. Still, the disease is becoming more common and is to an increasing degree developed early in life. This boosts the health care costs and sufficient resources often lack.
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Put simply, a bond is a loan. The issuer of a bond borrows money from the investor. This means that the issuer gets access to finance, while the investor – who takes a risk – can earn interest on its money.
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The new health bond to prevent type 2 diabetes is unique in its kind. The publisher, Region Stockholm, receives SEK 30 million to invest in preventive care, which can result in large future savings. The investor, Skandia, gets interest on its loan – but only if positive health effects are in fact achieved.
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SEB's role has been that of adviser and financial organizer of the bond. This entails creating a model that all parties benefit from and making sure that all the practical aspects of the bond function.