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  • Author: Michael Pisa, Denise McCurdy
  • Publication Date: 02-2019
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: In many low- and lower-middle-income countries (LMICs) where disease burdens are highest, health supply chains function poorly, resulting in frequent stockouts and a high prevalence of substandard and even falsified medications. In response to these concerns, the global health initiatives have stepped up their efforts to improve supply chain management. At the same time, a growing number of rich country pharmaceutical companies are investing in digital technologies that help them “track and trace” the movement of medicines through the supply chain at the package-level. Drawing from interviews with over thirty experts, we find that traceability offers a realistic solution to some of the problems found in LMIC health supply chains but that implementing the approach is a huge logistical endeavor that requires a strong political commitment. We close by discussing how donors can support committed governments, by taking an evidence-based approach to determine what traceability methods work best.
  • Topic: International Cooperation, Health Crisis, Pharmaceuticals , Tracing
  • Political Geography: Global Focus
  • Author: Kalipso Chalkidou, Adrian Towse
  • Publication Date: 04-2019
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: spending on pharmaceuticals and other healthcare commodities is high and makes up a large proportion of healthcare spending in rich and poorer markets alike. A popular response to the problem of escalating drugs budgets has been transparency of drug pricing within and across borders. In a rare alignment of policy priorities, the Trump administration, the US Senate, and the World Health Organisation are calling for more transparency of the prices paid for prescription drugs as a means of tackling the ever-growing pharmaceuticals bill. Recently Italy’s health minister joined in, calling for a World Health Assembly resolution which would mandate WHO to “provide governments with a forum for sharing information on drug prices, revenues, research and development costs, public sector investments and research and development subsidies, marketing costs and other related information.” But is price transparency really the answer to healthcare systems’ fiscal sustainability challenges as they strive to expand access to new technologies or even merely sustain provision within strained public budgets? Well, it depends!
  • Topic: Transparency, Medicine , Pharmaceuticals , Price
  • Political Geography: Global Focus
  • Author: Emma Boswell Dean
  • Publication Date: 04-2019
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: With the goal of driving down drug costs, governments across the globe have instituted various forms of pharmaceutical price control policies. Understanding the impacts of such policies is particularly important in low- and middle-income countries, where lack of insurance coverage means that prices can serve as a barrier to access for patients. In this paper, we examine the theoretical and empirical effects of one implementation of pharmaceutical price controls, in which the Indian government placed price ceilings on a set of essential medicines. We find that the legislation resulted in broadly declining prices amongst both directly impacted products and competing products. However, the legislation also led to decreased sales of price-controlled and closely related products, preventing trade that would have otherwise occurred. The sales of small, local generics manufacturers were most impacted by the legislation, seeing a 14.5 percent decrease in market share and a 5.3 percent decrease in sales. These products tend to be inexpensive, but we use novel data to show that they are also of lower average quality. We provide evidence that the legislation impacted consumer types differentially. The benefits of the legislation were largest for quality-sensitive consumers, while the downsides largely affected poor and rural consumers, two groups already suffering from low access to medicines.
  • Topic: Medicine , Pharmaceuticals , Price, Price Control
  • Political Geography: Global Focus
  • Author: Cassandra Nemzoff, Kalipso Chalkidou, Mead Over
  • Publication Date: 05-2019
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: As low- and middle-income countries reduce their reliance on donor aid, they are increasingly obliged to assume some degree of financial responsibility for donor projects. This challenge will be particularly complex in the procurement of health commodities. In recent decades, recipient countries have benefitted from donor-aggregated demand and pooling mechanisms, negotiated prices, purchasing, and delivery of commodities. However, as countries shift away from donor support, their challenge will be finding a way to aggregate demand in order to achieve the benefits that the pooled purchasing arrangements of vertical health programs now provide. As a first step in tackling this challenge, much can be learned from a diverse group of pooled procurement initiatives that have developed over the past 40 years in high-, middle-, and low-income countries. This note reviews the rationale and functions of these initiatives, notes their potential benefits and barriers, and draws lessons regarding how best to incorporate pooled pharmaceutical purchasing models into the design and implementation of health financing reforms in countries in transition. We first provide a brief background on the procurement challenges faced by countries in transition. In section 2, we provide an overview of different types of pooling initiatives, highlighting the key features of each. Leveraging our research and key interviews, we outline the real and potential benefits of pooling in section 3, and the most pressing barriers that organizations or countries will face as they seek ways to aggregate demand in section 4. In section 5 we discuss some of the issues that countries and development partners should address when considering pooled procurement initiatives and make two recommendations: (1) countries and development partners should conduct further research on the merits of pooled procurement, and (2) they should develop a straw model of a pooled procurement governance structure that could be tested using a series of pilots.
  • Topic: Budget, Public Health, Medicine , Pharmaceuticals
  • Political Geography: Global Focus