Author:
Felicitas Colombo, MPA
Director of Public and Government Affairs, Americas Health Foundation
One of the most controversial business decisions for the healthcare industry is to establish equitable access to essential medicines and technology with a reasonable return on investment after spending a significant amount on failed vaccines, or any drug, before reaching a successful one. Pharmaceuticals set drug prices with the argument that it finances research and development (R&D) for better treatments or for the development of a vaccine. Even if this calculation is true, maximizing profits for shareholders might be a variable of influence at the expense of access to medicines and, arguably, beyond ethical standards. Thus, establishing market access is, in essence, an issue of values that weighs the widespread availability of a drug and its profitability.
Promoting fair prices and cost-effective interventions is central to the achievement of the universal right to health coverage on the global agenda. Yet, the conversation around access goes well beyond market prices and should include other important variables like suitable regulatory landscapes for innovation, clear drug evaluation and approval protocols, well-defined pharmacovigilance studies, fitting patent protection laws, investment in health according to national Gross Domestic Product (GDP), updated national patient registries, updated clinical practice guidelines, availability of evidence-based data, interdependency of supply chains, transparent procurement and compliance mechanisms, reasonable manufacturing costs, and an overall ethical regulatory environment, to name a few. Other elements that hinder access are more directly linked to blunt criminal actions, like regulatory capture, fraud, or lack of financial controls and the divergence of public funds.
Political will and collective action are also essential to this discussion and include a wide array of diverse stakeholders like governments and industry, civil society, regulatory agencies, patient groups, scientific societies, international organizations, insurance companies, hospitals, universities, and the list goes on.
Humanitarianism: Is purpose bigger than resources?
The WHO’s Constitution of 1946 envisages “the highest attainable standard of health” as a fundamental right of every human being. Recognizing health as a human right acknowledges an ethical obligation to ensure equitable access to timely, adequate, and affordable healthcare. The question is, who pays the humanitarian bill?
In addition to examining the level and structure of health spending in 2020, WHO’s ‘Global Health Expenditure Report: Rising to the Pandemic’s Challenges’ focused on the response of health systems during the COVID-19 pandemic.
“Sharp rises in government spending on health at all income levels reinforced the surge in health spending to a new high of $9 trillion (approximately 11% of global GDP),” claims the report.
“Reported per capita health spending on COVID-19 from government and compulsory insurance financing arrangements in 2020 averaged US$212 in 16 high income countries and US$14 in 21 low- and middle-income countries with comprehensive data. Most reported health spending on COVID-19 was allocated to treatment (41%) and general preventive care and administration (36%),” it expands.
“Across the 50 countries with data, per capita total health spending rose 6% on average in real terms in 2020,” the report continues. “Per capita spending on preventive care rose substantially, by 32% on average—and at a higher rate than total health spending in 41 of the 50 countries.”
Moreover, according to the United Nations‘ report on The impact of COVID-19 on organized crime, robust evidence on the appropriation of public funds on “aid destined for distressed companies, medical and pharmaceutical goods, public works such as improvements to hospitals, and waste disposal services will be particularly at risk.”
The noticeable difficulty in identifying and properly channeling health resources could mean that actual spending might have been even higher. WHO’s report calls for more timely and detailed data reporting by Member States to determine the full impact of the pandemic on health services.
Thus, if experts’ claims that we are due an imminent zoonotic flu pandemic are true, fasten your public health wallets.
Equitable ACCESS or illness as a business model
In order to promote equitable access to vaccines, WHO has set an ambitious ‘Immunization Agenda 2030: Leave No One Behind’ (IA2030). With the support of governments and countries, the IA2030 is an overarching strategy that promotes global vaccination for the decade 2021–2030 to prevent more than 20 life-threatening diseases and save over 50 million lives.
Adding dimension to this objective, the global vaccines market is projected to grow from US$83.98 billion in 2024 to US$139.17 billion by 2032. Vaccines remain the most powerful and cost-effective way to protect the population worldwide from life-threatening infectious diseases. In fact, the return on investment (ROI) from immunization programs across two decades (2011-2030) is of approximately USD$22.2 billion using the cost-of-illness approach for ninety-four low- and middle-income countries.
Immunization efforts, supported by heightened awareness and government initiatives, have been instrumental in preventing 2-3 million deaths each year. Greater investment coupled with mergers and partnerships of companies are boosting the manufacturing and sales of new vaccines globally.
Simultaneously, in recent decades, a growing share of healthcare budgets has been allocated to paying for costly drugs that treat a small fraction of the population. Specialty drugs, which treat serious rare diseases, can often come with enormous price tags. These scientifically breakthrough therapies, which can amount to US$2 to US$3 million per treatment, are presenting challenges to governments and insurers with finite budgets. And the sector is expected to keep growing.
The global orphan drugs market is projected to grow from US$189.17 billion in 2024 to US$468.58 billion by 2032. One of the critical driving factors prevailing in the global market is the increasing R&D investments by prominent players for the development of novel products. Protection laws have become an effective instrument for the defense of access to specialty drugs under human rights mandates.
This significant growth projections for the orphan drugs market highlight the increasing financial burden on healthcare systems globally. Yet, healthcare budgets, which tend to be set prospectively, usually set caps on forthcoming spending to reduce financial risk.
Recent epidemiological trends and growth in pharmaceutical expenditure have raised concerns that the provision of ‘safe and efficacious medicines for all’ may become unsustainable. In response, many countries have implemented aggressive cost-containment policies, including price controls, volume controls, budgeting, second-tier drug options, and market-oriented policies to promote economic and fiscal sustainability.
A clear example is the ongoing legal challenge to the United States Inflation Reduction Act (IRA) of 2022, underscoring the pharmaceutical industry’s resistance to the new drug pricing measures it introduced. Recent and past court rejections of several lawsuits filed by big pharma continue to contest the legality of the IRA’s price-setting provisions.
A central feature of the IRA’s reform, unprecedented in U.S. history, is its authorization for the Department of Health and Human Services (HHS) to directly negotiate drug prices with manufacturers. Although termed as ‘price negotiation,’ the IRA effectively transforms this process into a price-setting mechanism, granting HHS the final authority over drug prices.
Since the introduction of the IRA’s pricing measures, pharmaceutical companies have contested the ‘voluntary’ nature of these negotiations, questioning the significant authority HHS wields over final pricing outcomes.
Overall, the IRA signifies a fundamental shift in U.S. drug price regulation and may profoundly impact incentives for pharmaceutical R&D, patent litigation, and market entry for competing drugs. With clear implications on the pharmaceutical industry, these price constrains may even have global implications on future investment in innovation.
Tangible tension between equitable access to medicines and the industry’s profit-driven model is indeed a pressing issue. The question then becomes, should innovation be left at the sole expense of the private sector?
Strategies to overcome the ACCESS puzzle
As inequalities persist as a major barrier to achieving universal health coverage, several organizations are addressing this complex issue. The debate over access to expensive drugs and medical technologies, along with increasing awareness of disparities in vaccination access within and between countries, has highlighted the importance of health ethics in policy and practice.
The WHO’s Health Ethics and Governance team collaborates with technical units to develop disease-specific guidance for conditions such as tuberculosis, COVID-19, HIV, and Ebola. Similarly, the Organisation for Economic Co-operation and Development (OECD) supports countries in developing high-performing health systems by measuring health outcomes, analyzing resource use, and evaluating policies that enhance access, efficiency, and quality of healthcare.
Developed in 2004 and last published in 2022, the Access to Medicine Index ranks the world’s 20 largest pharmaceutical companies according to their ability to make their drugs more available, affordable and accessible in 106 low- to middle-income countries. This index uses World Bank and United Nations classifications to assess economic advancement, human development, and inequality, serving as a tool to recognize industry best practices.
Despite these efforts, there is a pressing need for leadership to shape innovative ideas on healthcare access and regulatory environments. Human rights principles advocate for universal health, yet isolated initiatives often fall short of creating a cohesive plan across sectors. The challenge is to proactively consolidate effective strategies and partnerships while preparing for a potential health crisis.
Fair allocation of finite resources and equitable access to health services should be prioritized in any public health agenda. Balancing cost considerations with all other factors is crucial in discussions about access to medicines. Successful initiatives must involve all actors and foster interdisciplinary dialogue to develop actionable plans that would assure the sustainability of health systems.
A platform focused on reducing health inequalities through ethical practices and evidence-based interventions—supported by a multi-stakeholder alliance of experts—could significantly advance sustainable health policy, access, and education. When policies are properly designed and implemented, these objectives can be synergic.
