Product development partnerships, non-profit research institutes and private sector groups have come together over the past years to conduct research and development (R&D) in the areas of the development of drugs, vaccines and diagnostics for neglected diseases, including tropical diseases and other major infectious diseases like HIV and AIDS, tuberculosis and malaria. However, arguments have been put forward that their efforts are disjointed and that funding flows inefficiently to individual research projects resulting in insufficient resources, funding volatility, poor resource allocation, and duplicated and unnecessary efforts. In response, several pooled funding mechanisms have been proposed to address what proponents see as the key problem(s) in the current system: the Industry R&D Facilitation Fund (IRFF) originally proposed by the George Institute; the Fund for Research in Neglected Diseases (FRIND) proposed by Novartis; and the Product Development Partnership Financing Facility (PDP-FF) proposed by the International AIDS Vaccine Initiative (IAVI). The goal of this paper is to provide insight into the extent to which these three proposed mechanisms would have a positive effect on accelerating R&D for neglected diseases. It considers how these proposals are likely to perform against two criteria: their capacity to raise additional money for neglected disease R&D and their capacity to improve the efficient allocation of those funds. The authors of the paper use a literature review, interviews with key stakeholders and illustrative modelling to assess the proposals against these two criteria. Most interviewees expressed doubts that common ground could be found with regard to the metrics on resource allocation if the fund were covering a large and diverse part of the R&D space. However, stakeholders overwhelmingly agreed that a pooled fund focused on late stage work only would be a more feasible and useful proposition.
Public-Private Mix
In this study, the authors examined how economic reforms, like structural adjustment programmes that were developed and implemented in the 1990s, have affected the health sector. They report that these policies facilitated reforms in the health sector that facilitated the entry of multinational financial (insurance) and pharmaceutical capital. This redefined both the health-ill-care model and converted patients into consumers being pressured to buy products, largely via the media and the advertising industry.
In Kenya’s Home Management of Malaria Strategy, the government seeks to improve prompt and effective anti-malarial drug availability through the informal sector, with a potential channel being the private medicine retailers (PMRs). This paper examines the implementation processes of three PMR programmes in Kenya, in the Kwale, Kisii Central and Bungoma districts. The research methods included 24 focus group discussions with clients and PMRs, 19 in-depth interviews with implementing actors, document review and a diary of events. The researchers found that the Kisii programme was successfully implemented, thanks to good relationships between district health managers and the ‘resource team’, and supported by a memorandum of understanding. It had flexible budgetary and decision making processes which were responsive to local contexts, and took account of local socio-economic activities. In contrast, the Kwale programme, which had implementation challenges, was characterised by a complex funding process, with lengthy timelines tied to the government financial management system. Although there was a flexible funding system in Bungoma, a perceived lack of transparency in fund management, inadequate management of inter-organisational relationships, and inability to adapt and respond to changing circumstances led to implementation difficulties. The researchers conclude that an active strategy to manage relationships between implementing actors through effective communication mechanisms is essential for the PMR approach to work, in conjunction with a strong and transparent management system.
The purpose of this report is to identify and summarise lessons learned, opportunities and challenges in relation to the role of the private sector in the context of aid effectiveness. The authors conducted 47 qualitative interviews with different stakeholders, including external funders, private sector representatives (for-profit and private foundations), partner countries, civil society organisations and independent experts. Some respondents emphasised that the profit-driven incentives of the private sector seldom converge with development objectives, which poses challenges for the aid effectiveness agenda. In contrast, others noted that business incentives can converge with those of donors and partner countries, and private sector companies can contribute to development in three main ways, namely by integrating their core business operations and value chains, by making social investments and undertaking philanthropic ventures, and by promoting public advocacy, policy dialogue and institution strengthening. External funders in particular emphasised that for-profit private sector contributions to the development process are more sustainable if they are embedded in the core business strategy of a company. The authors propose new types of inclusive business models, with increased commitments to include people living in poverty as part of core business strategy, and where the private sector contributes best to aid objectives by running responsible businesses but also plays diverse roles and engages directly in aid processes.
During a World Economic Forum held from 26-29 January 2011 in Davos, Switzerland a panel discussion was held on children’s health, the first in the history of the Forum. The panel included World Health Organization Director-General, Margaret Chan, who called for universal access to vaccines for preventable diseases, insecticide-treated bed nets for all children living in malaria zones and proper and balanced nutrition for children. It also included Melinda Gates from the Gates Foundation, who called for greater investment in women and frontline health workers, such as community health workers, as well as universal vaccine access for all children. The panel included a number of speakers from the private sector, such as Muhtar A. Kent, Chairman of the Board and Chief Executive Officer, Coca-Cola Company, USA; Lars Rebien Sorensen, President and Chief Executive Officer, Novo Nordisk, Denmark who raised some examples of how product innovation can respond to health needs. While there was pressure for private sector involvement in improving child health globally, there was also critique of insufficient product innovation to make food and other products less harmful to child health; that industry voice and influence in political circles is stronger than that of people working with child health; that cuts to financing of social services are having a negative effect on child health; and the question was asked: "Can we have healthy children without healthy labour conditions and healthy wages?"
At the World Economic Forum, held from 26-29 January 2011 in Davos, Switzerland, the debate on health centred on combating chronic or non-communicable diseases (NCDs), such as diabetes, heart disease and obesity. A panel was held to discuss the issue, where speakers highlighted the need to redefine ‘global health’ to include not only infectious diseases such as HIV and AIDS, malaria and tuberculosis, but also NCDs. NCDs were noted to cause more than 60% of deaths around the world, of which 80% are in the developing world, yet only about 3% of developmental assistance goes specifically towards chronic disease. The panel discussed the potential of technologies to improve health, such as cellphone technology in monitoring patients’ health. The private sector was argued to have a role in implementing workplace policies to support employees’ health and well-being. The panel called for a diagonal approach blending disease specific programmes with health system strengthening, through specific priorities being used to drive general improvements and to build capacity of the public health sector to meet both current and future health challenges.
A compromise was struck at the World Health Organization (WHO) Executive Board meeting, held from 17-25 January 2011, allowing a Swiss pharmaceutical industry representative to sit on a committee selecting proposals for research and development (R&D) financing for neglected diseases, despite the fact that he is author of one of the proposals. In light of the fact that a predecessor working group fell prey to allegations of conflict of interest and lack of transparency, WHO added special safeguards to prevent undue influence, but questions remain for some about conflict of interest. The compromise was reached in the margins of the meeting after developed countries threatened to subject other committee appointees to scrutiny. Developing countries, including those with burgeoning generics industries also have candidates on the 21-member expert committee, though none is considered as directly positioned to benefit from the outcome. Critics say the Swiss private sector proposal could be worth billions of dollars to developed country brand-name pharmaceutical companies. Thailand raised concerns about the proposed expert and Brazil argued that equity in global health was at stake.
According to this article, South African government spending on health care comprises less than half of total health expenditure even though the public system serves more than 80% of the population (i.e. around 40 million South Africans) without private health insurance. Around 70% of all doctors and most specialists only work in the private sector, the remaining 30% serve the public sector. Sixteen per cent of the population use private doctors and hospitals which are covered by their health insurance, often with a monthly contribution from their employers. It is this stark public–private divide that the South African Government hopes its proposed National Health Insurance (NHI) scheme will deal with by providing universal access to health care based on need rather than ability to pay. Despite some reservations about whether government can afford to pay for the proposed national health insurance scheme, an integrated pool of funds has been offered as one way to ensure that all the public sector’s available human resources are used more effectively and efficiently.
Each year, diarrhoeal diseases claim the lives of nearly two million people – 90% of them children under the age of five. The problem is especially critical in Africa, a continent that contains 10% of the world's population, but accounts for 40% of the deaths of children under age five. This paper uses panel data on the sub-national regions of 26 African countries over 1985-2006, a period of expanded private sector participation in water supplies to explore the impact on child health. Using a fixed effects analysis the author suggests that an expansion in piped water after PSP was associated with a 5% decrease in diarrhoea in children under-five. The author notes, however, that PSP In Africa was often pursued as a remedy to a severely distressed water sector with government under-investment for years.
This reference guide on public-private partnerships (PPP) theory and practice is intended for senior policy-makers and other public sector officials in developing countries. The guide, available on order from the Commonwealth Secretariat, focuses on the key lessons learned and emerging best practice from successful and failed PPP transactions over the past thirty years. The guide provides a background to PPPs: concepts and key trends; the infrastructure PPP project development process; constraints to infrastructure PPPs and measures to alleviate them; donor initiatives to support infrastructure PPPs; recent PPP experience in Commonwealth developing countries and lessons learned and emerging best practices on PPPs.