ACT subsidy- operational pitfalls and opportunities by dffhrtcv3


									ACT subsidy- operational
pitfalls and opportunities

           Christopher Whitty

 Evidence to All-Party Parliamentary
        Malaria Group 2007
 Parasitological failure for antimalarials by
     day 28, Tanzania Mutabingwa et al, Lancet

% infections

                                                       new infections
                      AQ   AQ+SP    AQ+AS    CoArtem
                           treatment group
Many of children with malaria come nowhere
          near formal healthcare
Nigeria. Home 11%, traditional healer 12%, patent
  medicine dealer 36%, community health worker 2%,
  private clinic 2%, health centre 13%, hospital 4%.
  (Uzochukwu BS, Onwujekwe OE Int J Eq. Heal 2004)
Uganda. 45% of mothers seek any care for their children
  with fevers (Mbonye, SciWorldJ 2003). Of those that do 53%
  drug vendors/shops, 31% government health facilities.
  (Tumwesigire & Watson. Afr Health Sci 2002)
Mali. 76% mothers treat child's malaria at home (Thira et al
  TM&IH 2000)
Kenya. Only 32% of patients with fevers made at least one
  visit to a health care facility. (Guyatt & Snow Trans RSMH 2004)
     Indirect cost of care is the major barrier to
    accessing formal healthcare, then transport
•      Over half of the cost of a
     treatment episode is
     indirect cost (Wiseman et al
     PLOS Medicine 2006)

•      Opportunity cost,
     childcare, transport,
     information all barriers

• The poorest will go to the
  closest care.

• This will almost always be
  the private sector.
             Ability and willingness to pay

• Tanga region- average person
  gets malaria 3-5x a year
• May have 10 people
  dependent on a single income
  of $20 a month
• Cost of ACTs in the market $7-

• Willingness to pay for ACT at
  public health facilities- $0.8
   (Wiseman et al, Bull WHO)
Fake drugs and Veblen goods- further reasons the
  price of ACTs in the private sector must come
           (Newton et al PLoS Medicine 2006; CDC warning sheet 2006)
 Those involved in antimalarial drugs policy
 have sometimes made optimistic economic

• “If the quantity [of a good] should …fall short of
   the effectual demand… its price must rise”
   (Adam Smith, 1776)

• “As orders for the drug increase, the price of
   ACT will go down” (ACT Now Campaign 2003)

• “[it’s] created a major wave of shock in our
  organization ” RBM spokesman, NY Times
   14/11/2004 when 6 months after almost every country
   in Africa adopted ACTs as policy simultaneously the
   price of raw material quadrupled
           Can we leave it to the market?
• Limited range of competitors- but this is
• Substitution cost- alternative cash crops,
  high barriers to entry- cost of chemical
  plant for extraction.

We are paying for risk and inefficiency.
• Immature market; poor demand and
  supply forecasting.
• Possibility of synthetics makes return on
  capital uncertain.
• Shelf-life short- need good stock control
  or significant wastage.

• Price elasticity not certain- but non-linear
Access is one problem, which the subsidy
will help with. Overprescription is another.

              Need       Receive
            malaria      malaria
           treatment    treatment
 Over-diagnosis of malaria- a major problem

Syndromic management without tests common.

Where microscopy available negative tests widely ignored.

Between 30% and 99% of those prescribed antimalarials do not have
  malaria parasites

Cost-effectiveness of ACTs falls rapidly as misdiagnosis occurs.

Serious alternative diagnoses missed.

Prescription does not change with changing risk.
Tanzania- ratio treated with positive test to negative test 1:3 (Reyburn et al BMJ)

                              Febrile patients recruited

                Blood slide                                 RDT
                   1,214                                   1,202

     Positive               Negative             Positive            Negative
    174 (14%)             1,031 (86%)           190 (16%)          1,008 (84%)

    Antimalarial           Antimalarial        Antimalarial        Antimalarial
    171 (98%)              523 (51%)           188 (99%)           543 (54%)
Low transmission ratio treated with positive test : negative test 1:116 (Reyburn)


          Blood slide 418                                    RDT 406

    Positive 1           Negative 417           Positive 3      Negative 403

    Antimalarial            Antimalarial        Antimalarial      Antimalarial
         1                  227 (54%)                3            235 (58%)
   Over-diagnosis of malaria is a threat, but
             also an opportunity

• We have to accept that there will be waste of drugs- there already is.

• The worst that can happen is that the situation starts bad and stays

• It is more likely that the situation starts bad and gets better.

• This could have an impact not just on malaria, but on the other
  causes of febrile illness- which also kill children.
There is a realistic hope for artemisinins to
 come down in price in the medium term
What evidence there is suggests a reduction
 of malaria, and certainly not an increase

• Good evidence from South
  Africa, Zanzibar

• Indirect evidence from
  Tanzania, Gambia, Kenya,

• Major impact in some areas
  from PMI, and long lasting
   There are reasonable grounds for thinking a
 subsidy is necessary, and would taper down over
ACTs are needed, they need to be provided outside the formal sector,
  including the private sector, and the market will not in itself get the
  prices low enough to achieve this.

• We have to accept there will be waste, and this will be slow to

• All the long term trends are likely to favour the subsidy tapering
   away, including
-greater competition with more ACTs
-new sources of raw product, and reduction in risk pricing
(-probably reduction in overprescription and in malaria incidence
   reducing demand)

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