According to the World Health Organization, roughly one-third of the world’s population lacks access to even the most basic essential medicines — a figure that climbs to nearly half the population in the poorest parts of Asia and Africa. In many cases, even when essential medicines are available for purchase, access to treatment can be limited due to cost, as brand name pharmaceuticals are often more expensive, while generic medicines are not always widely available. As a result, people may be inclined to procure medicines from informal sources, such as markets, which typically contain medicine of unknown origins. These medicines are often falsified and substandard, and therefore may be less effective, toxic, or even lethal.
An important aspect of addressing these issues is ensuring a steady supply of affordable, quality medicines. However, this is often easier said than done. In this article, Devex drills down on ways that development stakeholders can increase the sources and supplies of quality-assured medicines to low- and middle-income countries, from working closely with pharmaceutical manufacturers, to correcting for market failures and addressing supply chain issues.
Working with manufacturers
A critical step toward increasing the supply of quality-assured medicines is ensuring that manufacturers produce them. While perhaps obvious, this is often difficult to do.
“Sometimes it is challenging to identify the manufacturers who are willing to invest and become a supplier of the different public health programs,” said Dr. Archil Salakaia, manager of the Core and Commonwealth of Independent States Programs within the Promoting Quality of Medicines program, or PQM, funded by the U.S. Agency for International Development and implemented by U.S. Pharmacopeia. “The problem is that for some medicines needed in public health programs, the market is small and the prices of the medicines are low, and as manufacturers are from the private sector, the profit margins don’t always align with their bottom line.”
“It’s important to focus on all the elements of a healthy market. Price is a part of this, but so is a healthy supply chain.”— Susie Nazzaro, senior program officer at the Bill & Melinda Gates Foundation
Susie Nazzaro, senior program officer at the Bill & Melinda Gates Foundation, advocates for the use of innovative financial tools — such as priority review vouchers, which allow companies to bring a medicine to the front of the line for review at the U.S. Food and Drug Administration if they invest in a treatment for a disease that primarily affects the poor, or is of public health value as well — to incentivizing manufacturers to produce goods that would otherwise not be profitable.
“Priority review vouchers are an example of innovative tools to harness industry investment and focus it on diseases that primarily affect the poor,” Nazzaro said.
To further incentivize manufacturers to produce the medicines needed, PQM offers technical assistance, funded by USAID, that includes auditing and overseeing changes to a manufacturer’s laboratory to comply with international standards.
“Providing free technical assistance to manufacturers to improve their assurance systems and make it compliant with the international standards — including the WHO prequalification program’s requirements — is a huge incentive for them,” explained Jennifer Derry, program manager at PQM. “This helps manufacturers to produce and sell quality-assured products needed for the public health market.”
Derry added that this, in turn, strengthens the overall quality of the system, as it is applied to other medicines as well. “It enables them to compete [to become] suppliers of different global or local public health programs.”
PQM and local capacity building
Another successful strategy is to build the capacity of local manufacturers to produce the medicines that are needed in-country, which has the benefit of increasing the local supply for consumers, potentially reducing prices, and creating a more sustainable source of medicines.
For example, Pakistan has one of the highest infant mortality rates in the world. An antiseptic used to clean umbilical cords, called chlorhexidine, can reduce the risk of newborn deaths in the country by 23 percent and isn’t expensive to produce. However, local manufacturers didn’t have the capacity or technical expertise to create chlorhexidine, forcing health officials to purchase it on the international marketplace.
In 2016, PQM began working to make chlorhexidine locally available. First, they identified and approached local manufacturers that might be able to produce the antiseptic. However, many manufacturers did not consider the antiseptic to be commercially viable, due to its typically low cost. To address this, PQM worked with manufacturers to increase their efficiency through staff training and standardization of testing and protocols. Simultaneously, they worked with the Pakistani medicines regulatory authority in an effort to expedite the registration process so the pricing of chlorhexidine would be fair, thus encouraging local manufacturers to produce it.
As of March 2017, Pakistan has two local producers of the antiseptic — ATCO Laboratories Ltd., and Aspin Pharma Ltd. — bringing the cost of chlorhexidine down to one-third of what it costs in neighboring Nepal. In a matter of months, locally-produced, affordable and quality-assured chlorhexidine is expected to reach health facilities across the country, dramatically expanding the product’s availability, and reducing the price of an essential medicine for newborns.
“Our goal is to strengthen medicines’ quality assurance system on the different levels,” said USP’s Salakaia. “From helping pharmaceutical manufacturers to improve their quality assurance standards, to building capacity of medicines regulatory authorities in the countries, we want to ensure that the system works, and quality-assured medicines are available for patients in need.”
Diagnosing and addressing market failures
Healthy markets are an integral part of that system, which is why the Gates Foundation’s Nazzaro advocates taking a holistic approach when considering why lifesaving medicines might be in short supply.
Pricing, she said, is one critical aspect of the market, in that a lower cost enhances access to supply, which is why large international organizations — such as the Red Cross and USAID — often negotiate prices with manufacturers to ensure that lifesaving medicines are affordable. However, Nazzaro also cautions against focusing exclusively on pricing.
“It’s important to focus on all the elements of a healthy market,” she said. “Price is a part of this, but so is a healthy supply chain. We want to ensure the fastest availability of high-quality products, and so need to look carefully at how products move through the market.”
Ensuring a reliable and steady source of active ingredients — particularly when active ingredients come from plants that need to be cultivated — can also be a major challenge in increasing access.
For instance, the first line treatments for malaria are artemisinin-based combination therapies, or ACTs, for which the active ingredient comes from a slow growing plant, Asian sweet wormwood. Challenges with year-to-year forecasting made the market extremely volatile: High prices one year would incentivize farmers to cultivate a higher volume of the plant the next, leading to an oversupply causing prices to plummet, which then cut the incentive for farmers to grow sweet wormwood again, leading to shortages. Such fluctuations strained the markets, making it very difficult for stakeholders to ensure a steady supply of the active ingredient.
Market forecasting is another way that international organizations can work with manufacturers to ensure that there are sufficient ingredients to meet demand. However, this is no easy process.
“Market forecasting is challenging because you have to estimate how many people will contract a disease in the future,” said Nazzaro. “There’s a lot of guesswork and you can get it wrong. Errors can mean medicine shortages or price hikes, so we work very hard with multiple partners who know these markets very well to generate strong forecasts.”
Ensuring healthy supply chains
Supply chain management is a critical component of ensuring a steady supply of medicine within a country, and in ensuring that medicines in circulation are affordable and of quality. According to a WHO study, inefficient supply chains often lead to unnecessary pricing markups, provide more risk for medicine quality to be compromised and can create demand for low-cost options, including falsified medicines. That’s why organizations like USAID are working with USP to look at the manufacturing, help with market authorization, develop guidelines on registration, distribution and inspection and assist in the testing of medicines once on the market.
Cracking down on the proliferation of falsified and substandard medicine is a complex undertaking, involving the cooperation and coordination of many different stakeholders. Devex looks at some of the causes of the proliferation of poor-quality medicine, introduces some of the key challenges to prevent this problem and examines the strategies that seem to be working.
One way to improve supply chains is to streamline them. According to Lisa Hare, the chief of the supply chain branch at USAID, the lead agency for the U.S. President’s Malaria Initiative, medicines in many lower- and middle-income countries are often distributed according to administrative structures, creating an unnecessarily long distribution chain. For example, medicine is stored first in a federal warehouse, then transported to a state warehouse, and finally distributed to more local dispensaries.
“It’s much better for medicine to go directly from the central level to local health facilities for a number of reasons,” said Hare. “Many of these medicines are temperature-sensitive, so the less time they spend on a truck in baking temperatures, or in small district warehouses that might not even have electricity, the better.”
USAID also works closely with governments to help train them in supply chain management, and encourages outsourcing to the private sector when appropriate.
“What you find is that health ministries are generally full of doctors, and while that’s great for deciding on health policy, they aren’t always the best qualified to run supply chains,” said Hare. “So part of what we do is help ministries outsource, and build capacity to provide oversight in order to ensure accountability.”
Supply chain management is just one piece of the puzzle, according to the Gates Foundation’s Nazzaro. Stakeholders need to work closely together to ensure that a steady supply of quality medicines is available to meet consumer demand, and engage diverse strategies on multiple levels, from stabilizing the supply of active ingredients, to working together with manufacturers, ministries of health, transporters and distributors.
“Every market is different, and when markets fail you need to dig deeply to understand the root cause of the problem,” said Nazzaro. “That could be supply chain, or pricing, or challenges with manufacturing. It’s critical to work closely with other stakeholders to ensure that we address the causes of the problems, rather than simply treating the symptoms.”
How can the international community come together to increase the sources of quality medicines in lower- and middle-income countries? Have your say by leaving a comment below.
This article is the second in a series of four articles on global health challenges caused by poor-quality medicines and approaches to achieving quality-assured medicines in low- and middle- income countries. For more information, visit www.usp-pqm.org.