To trust or not to trust the private sector — is that still the question?
“We should aim at providing free health care to the poorest, but by working with — not against — the private sector, to jointly explore sustainable funding models,” Dr. Aamir Khan, founder and executive director of Interactive Research and Development, told Devex on the sidelines of the 45th Union Lung Health Conference in Barcelona earlier this month.
Although the concept may have been considered “en vogue” since the 2011 High-level Forum on Aid Effectiveness, Khan acknowledged we still seem a long way from translating rhetoric about new partnerships for development into results on the ground. And one of the reasons, he pointed out, is the persistent mistrust of the public and nonprofits of the for-profit sector.
“There are efforts, but we are really far from a trusting relationship,” an official from Médecins Sans Frontières responded when challenged by Devex to name a few promising best practices for public-private partnerships during a press conference at the event.
Isn’t it time then to move beyond the notion of “trust” toward the concept of exploring common “interests” to ensure better health access? Here are four steps to create healthy partnerships for better access.
1. ‘Trust is good, control is better’ — build the regulatory box before opening it.
Asked about the potential for developing countries to engage with the private sector for health systems strengthening, Denis Porignon, a health policy expert with the World Health Organization, was straightforward.
In fragile states, he told Devex, “we need to stabilize the public health systems first — we need to build a solid [regulatory] box before opening it up for private-public partnerships,” so as to ensure that these types of relationships are not “more disruptive than constructive.”
2. Make use of the private sector’s comparative advantages.
After reaching a certain degree of stabilization, PPPs can help to strengthen systems.
“If you consider the Global Fund to Fight AIDS, Tuberculosis and Malaria as being a PPP, for example, its ability to purchase and procure large volumes of medicines at reduced prices can actually help support developing country procurement systems and access to medicines,” Porignon argued.
According to Khan, there is also a need to acknowledge the role that the private sector is already playing in developing countries.
“In Pakistan, half of the country’s yearly expenditure on health is out of pocket,” he said. “Fifty percent of all TB cases in large urban settings are accessing private sector care providers.”
In order to reduce donor funding dependency and make health interventions more sustainable, Khan suggested to “build models that allow us to tap into this large clientele, using private facilities to rationalize services available in order to improve them, reduce the number of referrals and ultimately reduce the costs of seeking care in an unstructured private sector”.
One example from his organization’s area of work was to operationalize systems where TB mass screening takes place, broadening them to include testing for other lung and associated diseases such as diabetes to reduce costs for patients.
3. Tap into existing commercial practices.
As for how to reach the poorest patients, Khan noted that in the long run, the best way would be to aim at UHC. However, so far, only the more developed countries such as Indonesia have been able to implement it.
In the meantime, he urged focus on using existing resources efficiently and to seek innovative ways of financing, including from the private sector, to reach the most vulnerable.
But how do you show the private sector what’s in it for them?
One way is to tap into existing commercial practices, like the payment of commissions. IRD, for example, looked at ways to incentivize mobile phone providers to co-finance its TB mHealth programs. The argument put forward was the potentially large client base these programs could be generating, with some 3.5 million people being screened for TB.
“The task was to find a way to allow commercial providers to benefit from this client pool without sharing confidential personal information about the patients with them,” Khan said.
One option would be to take advantage of the top-up of prepaid cards by patients, for which a commission is paid by commercial providers to the shop owners.
“By issuing a program card, we become a commission agency for five different mobile providers in-country,” Khan explained.
A similar approach is possible for the opening of bank accounts facilitated by development programs to enable the poor to get access to finance. The commissions paid by banks and commercial providers are very small, however, and he admitted programs would need to be scaled up significantly to make it a serious source of income for the project.
Would working with national governments help in that respect? Khan agreed that this would be one possible way to scale up the programs.
4. Innovative partnerships for health innovation.
Last, but not least, there are many ways of formally involving the private sector in the “doing good business” through PPPs.
The most prominent examples can be found in an area where the interests of the for-profit and nonprofit sectors naturally converge: health research and development.
But this is a sector where the international community has been faced with a dilemma: how to incentivize the vital continuation of health R&D on poverty-related diseases without making those who can least afford it pay for it?
As a starting point, effective PPPs can translate into better health policies and ultimately lead to better health access.
Devex spoke to Antoni Plasencia, director of the Barcelona Institute for Global Health — known as ISGlobal — about the innovative work of this research-based actor, itself a PPP involving governments, foundations and civil society actors.
“We realized that, by itself, research does not change things — we need other knowledge generation areas which connect with policy, implementation in the field and training,” Plasencia said.
Supported by a major private trustee, the Fundacion La Caixa, the institute now carries out activity throughout the value chain of knowledge in global health by taking a four-pronged approach: the generation, management, transmission and application of knowledge.
Convincing partners about this approach, however, was a key challenge.
“Traditionally, research organizations focused on research and think tanks tap into the research that others do,” Plasencia said. “Overcoming this silo mentality to ensure the continuity between research and policy was our first aim.”
One of the key tools used is advocacy, “sensitizing key stakeholders for informed decisions.”
That’s why the institute is not only looking to strengthen its biomedical research capacities for innovation, but also its expertise on health systems strengthening.
Plasencia admitted, however, that as a knowledge-generating organization, “we do not develop products to access the markets — we try to interact with organizations having these capacities.”
Pushing and pulling funding, pooling knowledge
MSF’s “Push, Pull and Pool” or 3-P initiative is one good example, using a three-pronged approach to “push” funding to finance research and development upfront through grants; “pull” funding to incentivize R&D activities through the promise of financial rewards after achieving certain objectives; and “pool” intellectual property to ensure open, collaborative research and fair licensing for the competitive production of finished products.
But while this type of approach has many advantages, it also poses some potential challenges. Porignon mentioned that while funding is provided during the early R&D stages, the later stage trials are expected to be funded through public resources.
“We are happy to finance the first few years, but then expect the government has to take over and it is often difficult for governments to say ‘no,’” he said.
This was countered by Dr. Grania Brigden from MSF, “The 3-P [initiative] is not a product development partnership and is not planning to undertake the regimen development, but to allow a framework for others to do the regimen development.”
Those who get access to the new funding and drugs in the pool, she said, would need to sign up to various access provisions to ensure affordable and sustainable access.
“Funders like the BRICS need to see the benefit of contributing towards this framework — to move away from the current system of paying twice for drugs, funding development grants and then paying high prices once the end product is registered,” she explained.
Putting the private sector in the lead
What about involving the private sector in the final — and more expensive — stages of R&D and product development?
“PDPs have played a key role in reducing mortality and morbidity indicators in developing countries”, Plasencia said.
According to Salma Samad, senior director in external affairs at AERAS, PDPs work by raising funding — from governments or donors such as the Bill & Melinda Gates Foundation — to support the earlier stages of development. While the donors bear the risk, there is then an opportunity to negotiate.
“When it goes to later stage clinical trials, we ask our pharma partners to invest,” she said. “Our partners have to guarantee to market the product at affordable prices for developing countries — if they cannot meet these criteria, they have to agree to a technology transfer.”
But what is the trick for incentivizing the private sector to participate? “PDPs allow the industry to develop new technologies that may also be usable for the development of products for other diseases,” Samad argued.
Moreover, in some cases, such as TB, she noted the private sector can get “access to higher-price markets in more developed countries — for example those sending health care workers, military personnel or volunteers to TB-affected areas. This is an incentive that works well for TB — most of our partnerships are with the pharma industry.”
Keeping a fruitful partnership and collaboration between PDPs and the 3-P initiative is essential. According to MSF, the 3-P responds to the fact that TB needs regimens for treatment, rather than single compounds, which means that there needs to be early and open collaboration to combine compounds to get regimens.
PDPs have to individually negotiate with each originator of new compounds — “a costly and time-consuming process that is not always successful, meaning that the best combinations are not always able to be trialled,” Brigden said.
This is why, he added, “the ‘pooling’ part is so important so that data on potential compounds is known and that these compounds can be made available for combination trials.”
PDPs collaborate with the government when it comes to obtaining the pre-authorization from the ministry of health and regulatory authorities for clinical trials. Here, the role for government should be to ensure the fast-track registration of new drugs. MSF pointed out that it had two new TB drugs, “which can to date only be used in compassionate use programs. This needs to change.”
So could the best cure for overcoming health inequities be to prescribe a regimen of healthy partnerships among the public, private and nonprofit sectors? To effect sustainable change, it would be just what the doctor ordered.
Sibylle Koenig is a development consultant and policy adviser with 10 years of experience in managing, monitoring and evaluating international aid programs and grant schemes, as well as advocacy. She has worked for a variety of organizations, including the European Commission, U.N. and bilateral aid agencies and NGOs in Latin America (4 years) and Europe, with extensive work travel to Africa (Tanzania, Uganda, Mozambique, Kenya, Botswana) and Asia (Cambodia, Vietnam, Thailand, India, South Korea).
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