A longstanding economic literature argues that the total welfare loss of a disease comes not only from the
direct effects of the disease itself, but also the costs of preventing the disease. This paper assesses how new
medical innovations for COVID-19—specifically vaccines and therapeutics—reduced both types of losses.
These rapidly developed medications and vaccines yielded enormous value in the US and abroad and are likely
among the most important innovations in recent history. We find that in their first year of widespread use,
these innovations saved at least 699,110 life years in the US, conferring a direct economic benefit of around
$371.6 billion. In addition, the reduction in mitigation strategies to avoid COVID-19 infections (e.g.,
lockdowns, quarantine measures, social distancing) that resulted from the availability of vaccines and
therapeutics led to a value of $933.1 billion in increased economic activity in the U.S. Thus, while these
innovations had a tremendous impact on population health, an even greater amount of value resulted from
enabling the return of economic activities through the lessening of efforts to prevent infection.

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