This backgrounder to a session of the WHO 56th World Health Assembly looks at issues surrounding innovation in public health particularly focusing on biotechnology, including genomics, pharmaceuticals, medical devices and other diagnostics. The report argues that innovation to address conditions which particularly affect the poor are often held back by market failure and/or under investment by the public sector. The report highlights a number of mechanisms to stimulate innovation. These include: Investment in basic science in developing countries; Public / private partnerships to address neglected diseases; IP mechanisms to promote private sector investment such as advance-purchase funds; Flexibility in the application of TRIPS as advocated in the Doha Declaration particularly with regard to licensing and exemptions; Improved technology transfer from North to South; Increased capacity building in developing countries; Greater international cooperation; Clear, co-ordinated setting of research priorities; and A sound regulatory environment.
Public-Private Mix
D. Fidler, CMH Working Paper Series Paper No. WG2: 18, 2002. At the beginning of the 21 st century, the global public good of infectious disease control is increasingly under-produced. The World Health Organization (WHO) warned of a global infectious disease crisis in 1996, and the crisis has deepened in succeeding years. The HIV/AIDS pandemic continues to devastate the developing world; and old scourges such as tuberculosis, malaria, cholera, and pneumonia continue to cause morbidity and mortality around the world.2 The anthrax attacks on the United States in 2001 raise the terrifying reality of bioterrorism and its threat to national and global public health. Attention to improving production of the global public good of infectious disease control has become imperative. The paper is also available online as PDF file.
The paper argues that there is potential for pharmaceutical companies to contribute more substantially and effectively towards increasing access to medicines for poor people in developing countries. This is yet to be achieved because their approaches have been ad-hoc, and they have failed to deliver sustainable solutions or adopt appropriate strategies. Oxfam recommends that the industry must put access to medicines at the health of its decision-making and practices. This is both a more sustainable long-term business strategy and would allow the industry to better play its role in achieving the universal right to health.
The authors argue that the World Bank Group should focus on supporting African governments to expand publicly provided healthcare – a proven way to save millions of lives worldwide and to drive down inequality. The International Finance Corporation (IFC)’s Health in Africa initiative is argued to be at odds with the World Bank Group’s welcome commitment to universal and equitable health coverage and to shared prosperity. The $1bn initiative, which promotes private sector healthcare delivery, is reported to be extremely unlikely to deliver better health outcomes for poor people, and the IFC is noted to fail to measure the extent to which Health in Africa impacts on people living in poverty.
The public health approach to regulatory intervention is normally very inclusive, bringing all stakeholders to the table to present their perspectives, to argue about the impacts of the interventions on their organisations, and to find compromises that work for the greater good of all those involved. However, the author of this paper argues against including the tobacco industry as a stakeholder in public health decisions, based on the reputation of the industry in obfuscating the truth about the harm of tobacco use, dividing the public health community over harm reduction approaches, and befuddling critically important regulatory processes. The profits from selling cigarettes and alternative tobacco products are simply too great for the tobacco industry to be a genuine stakeholder in public health, the author notes. Thus, the public health community needs to do what it does best: to rally popular support for strong, science-based approaches to prevention of tobacco use, to expose the truths about the harms of tobacco use to current users, and to support government agencies in carrying out their legislatively mandated duties to protect public health. The author highlights the irreconcilable conflict between the public health community and the global tobacco industry.
The authors identify two types of capital for foreign investment: capital of type K and capital of type N. While capital of type K is used in production of all the sectors of the economy, capital of type N is specific to the healthcare sector. Their analysis finds that an FDI of capital of type N although it raises the human capital formation may lower social welfare. On the contrary, an inflow of foreign capital of type K is likely to be welfare-improving. Although these effects crucially hinge on different structural factors e.g. the degree of
labour market imperfection, trade-related and technological factors these can at least question the desirability of allowing the entry of foreign capital in the healthcare sector directly.
This article addresses recent calls for the World Health Organisation (WHO) and the United Nations Children’s Fund (UNICEF) to develop a Code of Practice on the Marketing of Unhealthy Food and Beverages to Children. The author argues that such suggestions ignore the development of WHO’s Set of Recommendations on the Marketing of Food and Non-Alcoholic Beverages to Children and misrepresent its scope. The recommendations, adopted by the World Health Assembly in 2010, aim ‘to reduce the impact on children of marketing of foods high in saturated fats, trans-fatty acids, free sugars, or salt.’ In light of the current WHO reform process and financial constraints, the fact that WHO member states explicitly chose to develop a Set of Recommendations instead of a Code, the author questions the feasibility and value of re-opening the issue. Instead he recommends that the Secretariat be supported in their mandate to provide assistance to member states in implementing the existing WHO Set of Recommendations.
This study, from the National Bureau of Economic Research, examines the distribution of such spending according to income and type of health care in order to assess whether it would be possible to supply voluntary private health insurance to reduce variation in spending. Using data from the World Health Survey for 14 developing countries, the report finds that out variations in out-of-pocket spending depend on income. The authors use estimates of the variance of total spending, hospital spending, physician spending and outpatient drug spending tends to generate estimates of the amounts of money risk averse consumers might pay for insurance coverage. For hospital spending and total spending, these amounts are larger than the authors consider reasonable, suggesting that voluntary insurance might be feasible. However, the strong relationship between spending and income suggests that insurance markets may need to be segmented by income.
The Health Market Inquiry (HMI) report published in South Africa is a result of widespread complaints about rising prices and declining benefits in 2014, and was set up by the Competition Commission as an inquiry into the private health care market. A panel of independent experts was appointed, chaired by former Chief Justice Sandile Ngcobo. According to the Competition Commission nearly nine million people in South Africa (16.9% of the population) are members of medical schemes. Many are reported to feel resentful of paying a lot to medical schemes and still having to pay more out of pocket when they need care. The HMI report confirms that premiums are rising and benefits are falling. Expenditure on private health, where R235-billion is spent on nine million people, overshadows the R201-billion the government spends on the other 44-million. Yet the two systems are tied at the hip: they have overlapping staff, overlapping regulatory institutions, and of course an overlapping population for whom healthcare is a right. The National Health Insurance (NHI) reform is raising a need for scrutiny of all providers. The HMI recommends regulations, systems for effective and fair price control and institutions to oversee the market. Scheme members are urged by the author to obtain the report and to challenge the Minister of Health to implement the recommendations.
This book is about a new form of philanthropy dubbed 'philanthrocapitalism'. Philanthrocapitalists believe that foundations and non-profit civil society organisations should operate like market-oriented businesses. They believe that success in the business model can be emulated to make a similar impact on social change. The author concedes that it should certainly help to extend access to useful goods and services, and it has a positive role to play in strengthening important areas of civil society capacity, but social transformation requires a great deal more. Philantrocapitalism is a sign of a severely disordered and inequitable world. The author asserts that there is need for public debate between philanthrocapitalists and their critics about the complexities involved in social transformation. The book suggests a number of commitments that should be made: commitments to transparency and accountability, to democracy, to modesty and to devolution by investing in civic capacity and voice, and promoting the long-term financial independence of civil society organisations through long-term support.