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Global Health Presents the Congress with an Offer it Can’t Refuse

May 8, 2012

In a recent Foreign Affairs article by Laurie Garrett, titled in bold print: Money or Die, it is posited that although the pre-2004 funding for AIDS, TB and malaria say nothing about what would happen in subsequent years if funding was curtailed, the answer now is: most will die.  By this she means that if the “age of generosity” in health funding were to end due to the world’s economic crisis, this would leave “millions without life-sparing medicines and tools they have come to rely upon”.

The issue she raises presages an emerging problem in global public health policy, particularly as this community begins to address the challenges of non-communicable diseases (NCDs).  Like the initiation of AIDS treatment, when patients are placed on therapies for CVDs, diabetes, cancer, and upper respiratory diseases, there is no cure: treatment is needed for the remainder of a patient’s natural life span.

Once treatment begins, the donor community is taking out a long term, adjustable rate mortgage on ARV and NCD patients in poor countries. She goes on to comment that the “burden of reducing suffering and increasing the health of the world’s poor now falls largely on the backs of two Washingtons. The Gates Foundation … [and] the Congress”.  These two entities, one a tax exempt organization, and the other supported by U. S. taxpayers, now hold the future of unfunded health liabilities on an ever increasing number of international wards.

Leaving aside for a moment whether policy-makers in the donor community understood the future fiscal consequences when initiating these programs, does Laurie Garrett make a valid point? And, if so, is this long term commitment one that the Congress understands on behalf of the American people? Let’s examine that along several spectrums.

The activist community has long proposed that the barrier to access of therapies for the poor is price. Now, fiscal constraints reveal that price alone is a minor item among so many other costs: First, there is the cost of moving therapies from the factory to a port of entry (transportation, insurance, export and import duties, taxes, etc.). Secondly, there are pharmaceutical management costs (storage, distribution, training of pharmacists, quality assurance, etc.)  Thirdly, there is medical support infrastructure (staff training, laboratory, monitoring, surveillance, evaluation of outcomes, capital infrastructure, etc.). Then there are recurrent (operational) costs of any capital investment put in place.

Even at zero price for the needed therapies, these cost elements will overwhelm both governments and donors alike. On the price of therapies alone, WHO released results from a 2-year research effort with this major finding: “taxes and duties levied on medicines, as well as the mark-ups applied, frequently contributed more to the final price than the actual manufacturers’ price”. (See World Health Organization, The Price, Availability and Affordability of Medicines for Chronic Diseases, Geneva, 2006.)

Perhaps even more importantly, the incoming resource flows will increase pressure on these economies to provide an extraordinary amount of goods and services from local suppliers. Production possibilities, both for human and physical resources, are finite. It is likely that demand will compete with supply among the current providers of health services.  For instance, in Botswana the government promised to provide the Gates-Merck Program 100 medical doctors to work on HIV/AIDS.  It was unable to supply any, forcing the project to recruit from external sources.

The societies in developing countries are no different in terms of their changing demographics and epidemiology than are those in the developed world. Over the past four decades, donors expended their health funds on communicable disease programs. Now, with rising rates of life expectancy and lowering infant mortality rates, many more people in the developing world are surviving the ravages of childhood diseases. Once this migration has occurred, the unerring arrow of a costly NCD will strike somewhere along life’s uncertain path. Not much else in healthcare is certain. This is.

When PEPFAR was originally funded by the Congress in 2003, its 5 year budget was $15 billion: a time when less than 50,000 AIDS patients were on ARV therapies.  After its re-authorization, the budget increased to $48 billion. Then, the current Administration proposed a Global Health Initiative, combining PEPFAR’s $48 billion with an additional $15 billion for other health activities. The $63 billion covers a period over 6 years.

Of the 7.6 million patients now on ARV therapy, some 3+ million are covered by PEPFAR. Its new goal is to expand coverage to 6 million by 2015 when a third re-authorization will be required from the Congress. If 3 million are consuming $48 billion, will 6 million require $96+ billion, in addition to PEPFAR’s multi-billion dollar support to the Global Fund to Fight HIV/AIDS, TB and Malaria?

The Congress is now considering a budget for 2013 and many in the advocacy community feel that its health account is threatened and that there will be cuts in the current authorization, reducing the funds available for AIDS, TB and malaria.

The Congress, on behalf of the American people, has been generous in its support of global health over the past decade, accounting for 52% of all public spending, while the U. S.  private sector is responsible for 68%, according to the article in Foreign Affairs. PEPFAR had adopted cost-saving measures and has been able to shift more of the burden to affected countries.  Yet, as in every health program in the developed world, the demographic curve is unrelenting in the developing world, too: costs only increase as population’s age and IMRs improve.

Surely, we in the global health community can recognize the past and current generosity of the Congress and be more profound than the Godfather: there is no need to make it an offer it can’t refuse. Instead of more money for health, let’s show it that we can provide more health for the money.

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