An economic analysis of the market for malaria treatment in Cambodia

In developing countries, malaria treatment is often inadequate, notably in retail shops where the majority of people seek care. Shopkeepers are the last link in a chain of wholesalers who have an influence on treatment availability, price and quality. Evidence on competition in retail and wholesale markets is scarce, partly due to the methodological challenges of studying healthcare markets in poor countries. The thesis investigates how market structure, provider conduct, customer demand and regulation affect malaria treatment outcomes in Cambodia. In addition the thesis contributes to the development of methods for studying private drug markets. Cross-sectional surveys and semi-structured interviews of representative samples of antimalarial retailers and wholesalers were conducted to collect data on provider practices and perceptions. The contribution of different empirical methods for identifying and sampling wholesalers and measuring sales volumes was also assessed. Private commercial providers supplied the majority of antimalarial drugs, reflecting the relative proximity, long opening hours, reliable drug stock and friendliness of private retailers. Retail and wholesale competition increased accessibility to malaria treatment but did not lead to optimal supply of affordable quality treatment. Several market failures were evident: intense product differentiation, high concentration, and imperfect consumer information on treatment quality. These provided opportunities for higher mark-ups, although not in all market segments. With high market heterogeneity, higher retail mark-ups did not necessarily translate into higher consumer prices, highlighting the influence of distribution chain structure and wholesaler's price setting decisions. Government failures were also frequent, with poor public sector treatment accessibility and ineffective regulation'. Recommendations include widening distribution networks for artemisinin combination therapy and rapid diagnostic tests; improving product stock reliability; decreasing wholesale and retail product prices; intensifying providers' training; diffusing information to consumers on what constitutes appropriate management of malaria fever; and strengthening regulation and the potential to extend its supportive role

The private commercial sector distribution chain for antimalarial drugs in Benin - Findings from a rapid survey

In November 2008, the Global Fund to Fight HIV/AIDS, TB and Malaria announced that it would administer the first phase of an ambitious scheme to increase the availability of effective treatment for malaria, the Affordable Medicines Facility – malaria (AMFm). Artemisinin‐based combination therapies (ACTs) are highly‐effective, but remain prohibitively expensive for those who are most vulnerable to malaria infection.  AMFm aims to reduce significantly the price of ACTs by offering a co‐payment for ACTs purchased by eligible buyers at the top of the supply chain.    Recognizing that the public and private sectors are important sources of antimalarials in most endemic countries, both public and private sector buyers will be entitled to purchase subsidized ACTs.  The involvement of the private sector is an innovative element of AMFm, as many countries already have experience distributing ACTs in the public sector. To ensure that subsidized ACTs reach patients at the lowest possible cost, it is necessary to gain a better understanding of the private sector supply chains for antimalarials in each country participating in AMFm.   The objective of the rapid supply chain survey was therefore to assist Benin, which is one of the 11 countries invited to apply to the first phase of AMFm, in the development of an effective implementation plan by providing an understanding of the current supply chain for antimalarials, and the way in which subsidised ACTs are likely to travel through this chain to reach patients.  This report presents the findings of a series of semi‐structured interviews conducted with government officials and private suppliers of malaria treatment operating at the various levels of the chain.   At the time of the survey, antimalarial products sold in the private commercial sector were procured from international and domestic manufacturers by 3 active registered wholesalers and Benin’s public sector procurement agent: the Centrale d’Achat des Médicaments Essentiels et des Consommables médicaux (CAME). Manufacturers do not have sole distributorship agreements for registered pharmaceuticals, or other special relationships with particular wholesalers. Consequently, each wholesaler regularly stocks a large proportion of the antimalarials registered in Benin. CAME is responsible for procuring the generic medicines on the National Essential Medicines List. In practice CAME procures and supplies antimalarials not included on the National Essential Medicines List, as it is currently out of date

The private commercial sector distribution chain for antimalarial drugs in Nigeria - Findings from a rapid survey

In November of 2008, the Global Fund to Fight HIV/AIDS, TB and Malaria announced that it would administer the first phase of an ambitious scheme to increase the availability of effective treatment for malaria, the Affordable Medicines Facility-malaria (AMFm). Artemisinin-based combination therapies (ACTs) are highly effective, but remain prohibitively expensive for those who are most vulnerable to malaria infection.1 The AMFm aims to significantly reduce the price of ACTs by offering a co-payment for ACTs purchased by eligible buyers at the top of the supply chain. Recognizing that the public and private sectors are important sources of antimalarials in most endemic countries, both public and private sector buyers will be entitled to purchase subsidised ACTs. The involvement of the private sector is an innovative element of AMFm, as many countries already have experience distributing ACTs in the public sector. To ensure that subsidised ACTs reach patients at the lowest possible cost, it is necessary to gain a better understanding of the private sector supply chains for antimalarials in each country participating in the AMFm. The objective of the rapid supply chain survey was therefore to assist Nigeria, which is one of the 11 countries invited to apply to the first phase of the AMFm, in the development of an effective implementation plan by providing an understanding of the current supply chain for antimalarials, and the way in which subsidised ACTs are likely to travel through this chain to reach patients. This report presents the findings of a series of semi-structured interviews conducted with government officials and private suppliers of malaria treatment operating at the various levels of the chain. Supplemental sections include brief discussions on the Nigerian drug monitoring system, on the proposed tax exemption for subsidised ACTs under the AMFm, and also on the private sector capacity to repackage and re-label imported subsidised ACTs. In addition, data from the December 2008 report on the first round of the ACTwatch Outlet Survey in Nigeria were used to estimate key variables, such as antimalarial market shares

Global investment targets for malaria control and elimination between 2016 and 2030

Background Access to malaria control interventions falls short of universal health coverage. The Global Technical Strategy for malaria targets at least 90% reduction in case incidence and mortality rates, and elimination in 35 countries by 2030. The potential to reach these targets will be determined in part by investments in malaria. This study estimates the financing required for malaria control and elimination over the 2016–2030 period. Methods A mathematical transmission model was used to explore the impact of increasing intervention coverage on burden and costs. The cost analysis took a public provider perspective covering all 97 malaria endemic countries and territories in 2015. All control interventions currently recommended by the WHO were considered. Cost data were sourced from procurement databases, the peer-reviewed literature, national malaria strategic plans, the WHO-CHOICE project and key informant interviews. Results Annual investments of $6.4 billion (95$4.5–$9.0 billion)) by 2020,$7.7 billion (95% UI $5.4–$10.9 billion) by 2025 and $8.7 billion (95$6.0–$12.3 billion) by 2030 will be required to reach the targets set in the Global Technical Strategy. These are equivalent to annual investment per person at risk of malaria of US$3.90 by 2020, US$4.30 by 2025 and US$4.40 by 2030, compared with US$2.30 if interventions were sustained at current coverage levels. The 20 countries with the highest burden in 2015 will require 88% of the total investment. Conclusions Given the challenges in increasing domestic and international funding, the efficient use of currently available resources should be a priorit

ACTwatch 2009 Supply Chain Survey Results, Nigeria

In Nigeria, as in many low-income countries, private commercial providers play an important role in the treatment of malaria. To design effective interventions for improved access to accurate diagnosis and effective malaria treatment, there is a need to understand retailer behaviour and identify the factors that influence their stocking and pricing decisions. Private commercial retailers are the last link in a chain of manufacturers, importers and wholesalers and their supply sources are likely to have an important influence on the price and quality of malaria treatment that consumers can access. However, there is limited rigorous evidence on the structure and operation of the distribution chain for antimalarial drugs that serves the retail sector. The ACTwatch Supply Chain Study, one of the ACTwatch project components, aims to address this gap by conducting quantitative and qualitative studies on distribution chains for antimalarials in the ACTwatch countries (Nigeria, Cambodia, Benin, the Democratic Republic of Congo, Madagascar, Uganda and Zambia). Other elements of ACTwatch include Retail Outlet and Household Surveys led by Population Services International (PSI). This report presents the results of a cross-sectional survey of antimalarial drug wholesalers conducted in Nigeria between July and September 2009

A Qualitative Assessment of the Private Sector Antimalarial Distribution Chain in Nigeria, 2009

In Cambodia, as in many low‐income countries, private commercial providers play an important role in the treatment of malaria.  To design effective interventions for improved access to accurate diagnosis and effective malaria treatment, there is a need to understand retailers' behaviour and identify the factors that influence their stocking and pricing decisions.  Private commercial retailers are the last link in a chain of manufacturers, importers and wholesalers, and their supply sources are likely to have an important influence on the price and quality of malaria treatment that consumers can access.  However, there is limited rigorous evidence on the structure and operation of the distribution chain for antimalarial drugs that serves the retail sector. The ACTwatch Supply Chain Study, one of the ACTwatch project components, aims to address this gap by conducting quantitative and qualitative studies on distribution chains for antimalarials in the ACTwatch countries (Cambodia, Benin, the Democratic Republic of Congo, Madagascar, Nigeria, Uganda and Zambia).   This report presents the results from qualitative interviews with antimalarial drug wholesalers, retailers and other key stakeholders conducted in Cambodia between April and November 2009. A summary of the key findings is given below.  To provide a complete description of the supply chain for antimalarial drugs, this report should be read in conjunction with the report on the results of the structured supply chain survey also conducted as part of this study [1], available at www.actwatch.info. • As the bulk of antimalarial treatment is manufactured outside of the country, pharmaceutical importers, including PSI/Cambodia, constitute a critical component of Cambodia’s private sector distribution chain for antimalarials by ensuring a regular national supply of antimalarials and also by facilitating their distribution throughout the country. Non‐importing wholesalers also play a role in distributing antimalarials, particularly to more remote areas and to retail outlet types not targeted by importers, including more informal types such as drug shops, grocery stores, etc.   • The degree of competition varied by level in the distribution chain: at import level, competition was restrained by sole distributor and like agreements between foreign manufacturers and domestic importers, and also by a number of barriers to entry, including the costs of importing, the limited size of the overall market and lack of access to capital. Competition was less restrained at lower levels of the chain where the key barrier in theory to market entry was the difficulty of securing a license to operate, though many believed it was a barrier easily circumvented. • Commodities for malaria treatment, including ACTs and RDTs, were perceived to be generally available in the private sector distribution chain; however, availability of ACTs and RDTs at lower levels of the chain was poorer. At both wholesale and retail levels, stocking decisions were driven by perceived drug quality, which was in turn affected by factors such as media promotion and social marketing targeting wholesalers, retailers and consumers, as in the case of Malarine (the ACT brand socially marketed by PSI/Cambodia). However, supplier stock outs of Malarine combined with its perceived side effects led some providers to continue stocking alternatives treatments, including artemisinin monotherapies, even though they were aware that sales of such products were prohibited.   • Most wholesalers and retailers purchased new stock from either one or two suppliers. When choosing a supplier, factors considered were supplier selling prices, availability of delivery services, and perceived knowledge/expertise of the supplier in the treatment of malaria. Offering credit facilities was also cited as a strategy to attract custom, but access to supplier credit was perceived to be restricted to customers known to suppliers. 2 • Retailers and wholesalers had similar price setting behaviours. Providers reported setting their price on the basis of antimalarial purchase price and their price mark‐ups on the basis of transport costs. At the top of the chain, importers considered a broader range of costs when setting prices, including overhead and promotion costs among others. In addition, most providers admitted seeking profits, although many argued that their pricing decision was constrained by the price set by other shops. Second and third‐ degree price discrimination strategies were commonly reported by both retailers and wholesalers who varied prices on the basis of volume purchased and customer characteristics. • Retailers employed a wide range of tactics to gain competitive advantage over other businesses, attract consumers and generate demand. A retailer’s reputation for delivering high quality treatment, reflected in their length of operation in a market, positive consumer experiences, and through the provision of ‘cocktail’ therapies, was viewed as crucial to achieving this; however, providing added value services, such as of blood diagnostic testing, was not. Nevertheless, RDTs were available from many outlets and were perceived to be easy to use, although less precise than microscopy for confirming malaria infection

ACTwatch 2009 Supply Chain Survey Results, Zambia

In Zambia, as in many low-income countries, private commercial providers play an important role in the treatment of malaria. To design effective interventions for improved access to accurate diagnosis and effective malaria treatment, there is a need to understand retailer behaviour and identify the factors that influence their stocking and pricing decisions. Private commercial retailers are the last link in a chain of manufacturers, importers and wholesalers and their supply sources are likely to have an important influence on the price and quality of malaria treatment that consumers can access. However, there is limited rigorous evidence on the structure and operation of the distribution chain for antimalarial drugs that serves the retail sector. The ACTwatch Supply Chain Study, one of the ACTwatch project components, aims to address this gap by conducting quantitative and qualitative studies on distribution chains for antimalarials in the ACTwatch countries (Cambodia, Uganda, Zambia, Nigeria, Benin, Madagascar and the Democratic Republic of Congo). Other elements of ACTwatch include Retail Outlet and Household Surveys led by Population Services International (PSI). This report presents the results of a cross-sectional survey of antimalarial drug wholesalers conducted in Zambia between February and May 2009

ACTwatch 2009 Supply Chain Survey Results, Benin

In Benin, as in many low‐income countries, private commercial providers play an important role in the treatment of malaria.  To design effective interventions for improved access to accurate diagnosis and effective malaria treatment, there is a need to understand retailer behaviour and identify the factors that influence their stocking and pricing decisions.  Private commercial retailers are the last link in a chain of manufacturers, importers and wholesalers and their supply sources are likely to have an important influence on the price and quality of malaria treatment that consumers can access.  However, there is limited rigorous evidence on the structure and operation of the distribution chain for antimalarial drugs that serves the retail sector. The ACTwatch Supply Chain Study, one of the ACTwatch project components, aims to address this gap by conducting quantitative and qualitative studies on distribution chains for antimalarials in the ACTwatch countries (Benin, Cambodia, the Democratic Republic of Congo (DRC), Madagascar, Nigeria, Uganda and Zambia).  Other elements of ACTwatch include Retail Outlet and Household Surveys led by Population Services International (PSI).  This report presents the results of a cross‐ sectional survey of antimalarial drug wholesalers conducted in Benin in June 2009

ACTwatch 2009 Supply Chain Survey Results, DRC

In the DRC, as in many low‐income countries, private commercial providers play an important role in the treatment of malaria.  To design effective interventions for improved access to accurate diagnosis and effective malaria treatment, there is a need to understand retailer behaviour and identify the factors that influence their stocking and pricing decisions.  Private commercial retailers are the last link in a chain of manufacturers, importers and wholesalers and their supply sources are likely to have an important influence on the price and quality of malaria treatment that consumers can access.  However, there is limited rigorous evidence on the structure and operation of the distribution chain for antimalarial drugs that serves the retail sector. The ACTwatch Supply Chain Study, one of the ACTwatch project components, aims to address this gap by conducting quantitative and qualitative studies on distribution chains for antimalarials in the ACTwatch countries (the Democratic Republic of Congo, Cambodia, Benin, Madagascar, Nigeria, Uganda and Zambia).  Other elements of ACTwatch include Retail Outlet and Household Surveys led by Population Services International (PSI).  This report presents the results of a cross‐sectional survey of antimalarial drug wholesalers conducted in the DRC between January and March 2010