By Obaid Khan, Humanitas Global
There is a pivotal shift in the way epidemic of tuberculosis is approached today. As the disease burden has mostly afflicted the resource-constrained low and middle income countries in recent years, the market dynamics have also transformed. In this follow-up blog post, we will explore the implications this has for investment and development in TB research and development (R&D), diagnostics and treatment tools.
As the airborne infectious disease of TB continues rapid transmission throughout the global community, the innovations in diagnosis and treatment are not in consonance with the transmission rates in high burden countries. The underlying reasons for these development gaps need to be explored. Advocacy and activism can be instrumental in highlighting the slow progress in TB control. However, advocacy needs to work with a deeper understanding of the concurrent reasons below par efforts against TB transmission exist.
Comprehending the lack of investment for TB R&D can result in useful insights to the nature of stumbling blocks. These obstructions hamper the initiation and implementation of innovations for low-resource settings in particular. An interesting trend that can be derived from the TB R&D funding is the crowding out of private sector funding by philanthropic funding. The drop in private sector funding can be traced to Pfizer’s exit from TB R&D in 2012. In retrospect, this move was telling about the low profitability for the pharmaceutical industry’s investment in research for TB drug development. Pfizer’s strategy resonated with other players in the market as Astra Zeneca and Novartis also halted TB R&D. These structural changes in the pharmaceutical industry reflect the low returns on investments expected from low and middle income country markets. From a humanitarian perspective, industries should keep investing in TB to develop effective, low cost solutions regardless of profits. However, the private sector’s sustainability is embedded in its profitability. But, to address the issue at hand, there is a need to realize that a market failure hampers the progress in the TB innovations frontier. Focusing on this evaluative space can help to design comprehensive market interventions to reinvigorate industrial investment in TB diagnostics and treatment innovations that meet the needs of those afflicted.
Market interventions must take a multi-pronged approached to contextualize the varying nature of market failures in high-TB burden countries. Middle-income high burden countries, like Brazil, Russia, India, China and South Africa, can lead the way in employing market-based solutions. These countries can benefit from introducing a market intervention that aims to foster affordable solutions to curb TB and its transmission effectively. There is potential to encourage generic manufacturing for anti-TB drugs and implementing policies that promote the innovations cycle. Multinational corporations, donors and multilateral organizations can collaborate to support the innovators and manufacturers in these emerging economies. These interventions can be categorized as ‘facilitating’ mechanisms that help the host country in strengthening the health systems. Bolstering clinical trial capacity and other relevant facets can expedite the development of affordable diagnosis, treatment and other drugs.
Multilateral and philanthropic organizations need to collaborate with the legislators to disrupt the standing structure of the sub-optimal systems and practices. There are notable examples where UN programs, such as UNICEF and WHO, have partnered with other organizations to invigorate innovative solutions in healthcare in developing countries. These consortiums of donors, like Stop TB Partnership and GAVI Alliance, employ forward pricing agreements for the diffusion of innovations. One such example is that of Stop TB Partnership, particularly the TBXpert Initiative, which aims to facilitate the diffusion of health innovations in high TB burden developing countries. The program, funded by UNITAID and WHO, and managed by Stop TB Partnership, focuses on the procurement and uptake of rapid tuberculosis diagnostic test called GeneXpert. GeneXpert systems and cartridges are procured by the consortium of aforementioned partners from the manufacturer, Cepheid, at a discounted price in exchange of guaranteed market in high burden countries. The broad market mechanism to incentivize innovators was envisioned by Michael Kremer in the following words, "Pull programs reward research outputs, for example, by committing in advance to purchase a specified amount of a desired product at a specified price”.
GAVI Alliance utilizes similar market mechanisms, as Stop TB Partnership, to address the market failures in the provision of underused and new vaccines in poor countries. The Alliance comprises of Gates Foundation, UNICEF, World Bank and WHO. Forward pricing agreements are employed to incentivize the manufacturers for free provision of rotavirus, pneumococcal and pentavalent vaccines in poor countries. From 2010 to 2015, GAVI Alliance has been able to exceed the targets in terms of number of countries receiving the aforementioned vaccines. This market intervention has improved vaccine coverage rates in the GAVI eligible countries considerably. However, concerted efforts are required to reach the pre-determined targets.
As the world has become a global village, various global partnerships have emerged and there have been concerted efforts for diffusion of innovations. Development discourse and practice has transformed from a paternalistic aid paradigm to one of mutual partnerships for sustainable solutions. Stop TB partnership is an example of one of the partnerships that aim to improve TB outcomes in the disease afflicted resource-constrained countries. Innovative market interventions, complemented by adaptive implementation policies, can prove to be a great leap forward in eradicating the epidemic of tuberculosis.
