CEO Blog: Breaking Down the Barriers to Access Health Care
Every year millions of the world’s poorest people die from curable or preventable infectious diseases or suffer unnecessary ill health because they do not have access to basic health care services, including essential medicines and vaccines.
The reasons for this are complex and plentiful.
Many people living in poverty do not have enough food or clean water, never mind access to a functioning health care system. Effective medicines for prevalent diseases may be lacking due to myriad issues, including the limited prospect of a return on research and development (R&D) investment for neglected diseases. Added to this there is no unified regulatory registration system for medicines, which makes gaining regulatory approval for medicines and vaccines costly, complex and time consuming. Furthermore, national regulatory authorities often do not have sufficient capacity to deal effectively with numerous, complex product registrations from multiple companies.
In many developing countries the distribution network for medicines is weak and there is a lack of basic infrastructure, hospitals, clinics and health care professionals. These barriers are often compounded by insufficient political will and capacity for action, resulting in inadequate funding across all aspects of the health care system. In middle income countries the health system may be more developed, but large differences in income levels can prevent many people accessing healthcare.
These problems cannot be an excuse for inaction. Rather, they should indicate where action is most needed.
Despite significant progress over the last decade, we need to do more to increase access to medicines.
The first step is to prioritize areas where it is possible to make the most difference through our business activities, skills and resources.
In our case, this means initiatives to improve affordability and to conduct and encourage more investment in R&D for diseases of the developing world.
GSK is contributing to global health through preferential pricing of our medicines and vaccines. We are investing in and pursuing a flexible open innovation approach to R&D that targets diseases particularly affecting the developing world. We are supporting community investment activities and innovative partnerships that foster effective healthcare.
Additionally, inspired new funding mechanisms encourage the private sector to engage in medicine and vaccine development for the developing world.
For years we have offered our vaccines at a tiered price – meaning that the least developed countries in the world pay as much as 90 percent less than developed areas such as the US and Europe. This model has enabled us to provide 80 percent of our vaccine volume to the developing world, invest more into R&D for diseases of the developing world, and focus a third of our vaccine pipeline on these diseases that disproportionately affect resource poor countries.
This year, a new funding mechanism, the GAVI Alliance’s newly launched Advance Market Commitment (AMC) for pneumococcal vaccine, is a great example of effective partnership. GSK and Pfizer have each committed to supplying up to 300 million doses of their pneumo vaccines over the next decade to GAVI countries, a very sizeable, long-term contract that will help protect up to 100 million children on GSK’s side alone. Though the program is still in its infancy, the AMC is working to close the time gap between access in developed countries compared to the world’s poorest countries.
We are starting to see how innovative pricing models in vaccines can be adapted to improve access to medicines too. Last year, GSK announced a tiered pricing structure for drugs around the world. This means we reduced our prices for patented medicines in the least developed countries (LDCs) so that they would be no higher than 25% of developed world prices. Since that time, we’ve seen significant increases in uptake for the majority of products following the price decreases. In some cases, sales are eight times higher than they were the previous year.
We have also received feedback from some physicians indicating that more patients are using these medicines and that patient compliance with the prescribed dose has improved in some cases.
Yet our focus on improving access is not limited only to the LDCs. The so-called emerging markets represent an enormously diverse group of countries that have experienced explosive economic growth in recent years. Rapidly expanding populations and emerging middle classes make these countries an important source of future business growth for health care companies. Nevertheless, the vast differences in a person’s ability to pay for health care - often an out-of-pocket cost in these parts of the world – have been a barrier to accessible health care.
By extending a flexible pricing strategy for middle-income countries, rather than just the LDCs, we’ve improved the affordability of our medicines and increased access for low-income patients, while remaining profitable. For example, we recently launched a new medicine in Mexico at a cost that is significantly lower than the market leader. Many in the local health care community were surprised by this decision. Yet, after only 16 weeks on the market, we saw lower-income patients who had been on much older, suboptimal treatments, switched to the newest available therapy, which they could now afford. The pricing decision was in the best interest of patients and our business.
For the pharmaceutical industry, thinking differently about how to improve access to medicines and improve R&D for diseases of the developing world is not just right thing to do; it is essential for sustained business success. However, the global community must provide political will, a significant mobilization of additional resources, and a spirit of partnership if we are to see an improvement in health care and quality of life across the developing world.
Many of these initiatives are new territory for all of us. To be successful, we must push forward, always looking for ways to improve, and finding opportunities to do more.
Programming Alert - Mr. Witty will be a guest on CNBC's Power Lunch Tuesday, June 22 at 1:15pm/ET
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Andrew Witty assumed the position of Chief Executive Officer on 21 May 2008. He is a member of the Board and Corporate Executive Team and previously held the role of President, Pharmaceuticals Europe. Andrew joined Glaxo in 1985 and held a variety of roles in the UK business. Mr. Witty has served in numerous advisory roles to Governments around the world including South Africa, Singapore, Guangzhou China and the UK. Andrew is President of the EFPIA, a position he took up on 1 January 2010. Mr. Witty has a Joint Honours BA in Economics from the University of Nottingham.