Administrator

Full Bio

Showing posts on the Global Health Policy blog. View author posts on:

AEI Takes on Demand Forecasting for Malaria

April 24, 2008

In honor of World Malaria Day tomorrow, AEI research fellow Roger Bate has issued a new policy brief and related magazine feature decrying the state of global demand forecasting for artemisinin-based cominbation therapies (ACTs):

WHO estimates often rely on ‘need,’ a normative concept of how many people should be treated, rather than on demand, a positive concept of what can and will be bought. In 2004, the WHO projected that the global need for ACTs in 2005 would be over 130 million treatments. This projection proved to be way too high; in 2005, maximum demand was only 25 million treatments. Major suppliers such as Novartis and Sanofi-Aventis relied on WHO estimates and, as a result, were forced to either destroy unused products or declare substantial losses when the anticipated demand never materialized. In December 2006, Novartis temporarily shut down its production facility in Suffern, New York, to prevent the production of too much medicine with a short shelf life; Chinese farmers had begun to complain that they had no buyers for their Artemisia annua. With an excess of supply, prices of Artemisia annua have plummeted, and now the WHO fears that farmers and artemisinin producers may withdraw from the market, reducing the overall supply of drugs and creating a risk of future shortages.

In the short run, unrealistically high demand estimates are costly for companies. In the long run, they are costly for the millions of people afflicted by malaria. If drug companies must weather too many losses as a result of misjudging malaria demand, they may decide to invest in drug development for other diseases. The WHO argues that its forecasts are better today. But to be useful to companies, they have to be provided at least 12 months in advance, and the WHO forecasts are not.

1 Comment »

Tearing Down the Barriers: Increasing Access in Emerging Pharmaceutical Markets

March 17, 2008

By Administrator in Drug Resistance, HIV/AIDS & Infectious Diseases, Tuberculosis Tags: Drug Resistance

Yesterday, the Financial Times reported GlaxoSmithKline’s exciting new strategy to expand markets and increase access to medicines in low- and middle-income countries. Through an internal policy known as “tearing down the barriers,” the company has established differential pricing schemes within and between India, South Africa and other developing countries, in hopes of shifting to a new low price, high volume business model. While similar initiatives have existed for AIDS antiretrovirals (in part through the work of the Clinton Foundation), the GSK strategy notably moves beyond the “Big Three” infectious diseases to tackle the growing challenge of diabetes and other noncommunicable diseases with a dual market among the rich and poor.

Although variants on this idea have been around for quite some time (for example, see related papers by Jenny Lanjouw or Patricia Danzon), GSK is the first company to implement such a policy openly and systematically across a broad range of products. But they almost certainly won’t be the last. Tiered pricing and the “middle markets” were prominent themes throughout last week’s Partnering for Global Health Forum, where biotechnology leaders came together with pharmaceutical manufacturers and global health funders to identify opportunities for collaboration in this new environment. Several biotech companies are seeking opportunities in emerging markets and are seeking novel business approaches that would serve the full spectrum of needs and abilities to pay in those countries. Here, too, the conversation frequently turned towards ways to price products to better serve the poor without eroding prices in their major markets. (Keep tabs on the Kaiser Family Foundation’s HealthCast, which should be broadcasting many of the sessions soon.)

Here at CGD, we hope to continue the dialogue over the next several months under the auspices of our new Global Health Frontiers project. It will be interesting to see whether the low-price high-volume approach taken by GSK can be sustainably extended to other companies and product areas, and whether there are other business models (such as joint ventures, in-country manufacturing, or voluntary licensing) that could profitably serve both those who can afford to pay a lot alongside those who can only afford to pay a little. It seems that some forward looking companies are willing to step into the new frontiers. This is a delicate time when the public health community can be either be supportive of these early efforts or send companies scurrying for less risky opportunities.

1 Comment »

Voting for Better (Global) Health

February 19, 2008

By Administrator in Population & Reproductive Health Tags: Population & Reproductive Health

As the U.S. presidential primaries come down to the wire – with Obama and Clinton in a dead heat for the Democratic nomination and Huckabee still doggedly pursuing McCain in the Republican race – both foreign policy and domestic healthcare have been at the top of the campaign agenda. Global health lies squarely at the intersection of these hot topics, and as such has received an unprecedented amount of attention from both sides of the aisle (not to mention from the incumbent President, who is currently promoting his health and development successes in Africa). But for the development-minded voter, who’s the best pick? To help answer this pressing question, the Kaiser Family Foundation is putting the spotlight on each candidate’s statements and positions on global health and HIV/AIDS issues over at health08.org (albeit a tad too late for the Beltway voters). Not surprisingly, for example, there is across the board support for the yet-to-be-renamed PEPFAR. For a CGD view on this and other U.S. initiatives, check out Global Health TV, where my colleague Nandini Oomman recently explained why global HIV/AIDS is an important issue in the Presidential campaign, what different candidates are committing to on this issue, and how she thinks the next President can increase the effectiveness of HIV/AIDS funding. Consider this a teaser – these ideas and more will be discussed at greater length in our forthcoming book The White House and the World.

Comment »

Global Fund Grant Programs: An Analysis of Evaluation

July 3, 2007

By Administrator in Global Fund, Global Health, Global Health Architecture and Governance, HIV/AIDS & Infectious Diseases, Tuberculosis

The Global Fund to Fight AIDS, Tuberculosis and Malaria has quickly become one of the world’s largest funders of health programs. Just five years after its founding, it has approved proposals worth $6.8 billion for 448 programs in 136 countries, and disbursed over $3 billion. In this article, originally published in The Lancet, Steve Radelet and Bilal Siddi analyze the first 140 program grants evaluated by the Global Fund and the association between the programs’ evaluation scores and various characteristics of the grants themselves (e.g., financial size, disease target, type of recipient), the health sector (e.g., physicians per capita, donor concentration) and the recipient country (e.g., income level, governance ratings).

Key findings include:

Programs implemented by civil society/private sector recipients receive higher scores than those implemented by the government.
AIDS and TB programs receive higher scores on average than malaria programs.
Smaller grants tend to receive higher scores than larger ones, as do grants that were rated more highly at the original proposal stage by the Global Fund’s Technical Review Panel perform better.
With respect to health sector characteristics, evaluations scores are higher in countries with more physicians per capita and high immunization rates, suggesting that capacity and institutional strength in the health sector have a strong influence on program success.
Scores are also higher where the health sector has fewer donors and where Global Fund grants are a larger share of donor funding.
Lower-income countries tend to have higher evaluation scores; countries with larger budget deficits tend to receive lower scores; and countries that currently have or have had socialist governments tend to receive higher scores.
Acess the full article (pdf)

Comment »

Changing the IP Debate

March 18, 2007

By Administrator in Chronic Disease, HIV/AIDS & Infectious Diseases, Population & Reproductive Health Tags: Population & Reproductive Health

Intellectual property rights have been in the news quite a bit recently in light of the ongoing controversy over Novartis‘ pursuit of patent rights for its cancer drug Gleevec in India as well as Abbott’s announcement that it will not register any new drugs in Thailand following the government’s decision to issue compulsory licenses for two AIDS medications as well as a common drug for heart disease. In my mind, these cases represent a fundamental shift in the IP debate away from its origins as part of the broader discourse on HIV/AIDS in Africa. Instead, India and Thailand – both lower-middle-income countries – seem to have taken a much broader interpretation of their rights under the TRIPs agreement, extending its application beyond just ARVs to include chronic and non-communicable diseases. As pharmaceutical companies attempt to navigate these muddy waters, they are now forced to re-evaluate the line between charitable social responsibility and real market development – and so as I see it, the slope between providing drugs now and incentivizing future innovation just got a whole lot more slippery.

2 Comments »

Health Insurer to the Poor?

February 19, 2007

By Administrator in HIV/AIDS & Infectious Diseases, Malaria, Pharmaceuticals & Health Products

Awhile back, Christine Bowers over at the PSD blog commented on a trend in Mexico towards micro-insurance, noting that 2007 may be the Year of Micro-Insurance:

I think this could be the year that we wake up to the possibilities of microinsurance. Not only life insurance, but also health, crop, livestock and other insurance policies are a classic win-win for the poor and the companies who serve them. Microinsurance is every bit as powerful as microcredit.

As my colleague David Roodman and his co-author, Uzma Qureshi, note in Microfinance as Business, there has been exciting experimentation with credit-linked life insurance in Uganda and Thailand. In my own work from the microfinance funding side, I’ve seen a similar trend in Kenyan microfinance institutions.

Credit-linked life insurance makes sense. From the microfinance institution perspective, life insurance reduces the costs of borrower default in a population where it may be difficult to tell who is sick. For borrowers and their families, it can help cover potential funeral costs and reduce household income vulnerability to illness.

I’ll be curious to see if African microfinance institutions, particularly in the face of high HIV/AIDS prevalence, begin to offer credit-linked health insurance products to their clients. These products have the potential to improve borrower health, reduce household income variability, and make good business sense to the microfinance institution.

There are certainly difficult questions here surrounding the unique moral hazard and adverse selection issues in health insurance; it’s far from clear the concept would work successfully. But, if anything, the story of Muhammad Yunus and of microfinance has been one of experimentation. When collateral was thought to be critical to lending and the poor were perceived to be bad credit risks, Yunus experimented with group loans in Bangladesh and John Hatch experimented with village banks in the Americas. So will someone find a way to make credit-linked health insurance work?

Update: The Wall Street Journal also weighs in on the growing role of microinsurance (via the PSD blog)

Comment »

Health Affairs on Cardiovascular Disease

January 16, 2007

By Administrator in Donor Community, HIV/AIDS & Infectious Diseases, HIV/AIDS and other Infectious Diseases, PEPFAR

The latest issue of Health Affairs includes a feature article on policy recommendations to reduce cardiovascular disease in the developing world:

A global CVD epidemic is rapidly evolving, and the burden of disease is shifting. Three times as many deaths from CVD now occur in developing countries as compared with developed countries. The economic and social costs of this burden will be great, particularly because many developing nations are still grappling with poverty-related diseases such as malnutrition, infectious diseases, and poor health care facilities. However, a broad range of individual- and population-based strategies exists at affordable prices and, if implemented, could reduce the burden of CVD disease by more than half. Reductions in tobacco use should be the cornerstone of these interventions. Simultaneously, efforts can be adopted to prevent the further development of CVD risk factors. These interventions are often less expensive per capita but often do not yield the benefits until much later. The interventions that are most cost-effective target those who are at highest risk for death, such as those with advanced disease or overall high risk for CVD.