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Evolving markets require evolving market approaches

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UNITAID's Brenda Waning Presentation at the UNITAID/UNAIDS/Medicines Patent Pool Side Event,
United Nations High Level Meeting on AIDS
New York
9 June, 2011

Published in: Health & Medicine
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Evolving markets require evolving market approaches

  1. 1. Evolving markets require evolving market approaches Brenda Waning UNITAID/UNAIDS/Medicines Patent Pool Side Event United Nations High Level Meeting on AIDS New York 9 June, 2011
  2. 2. UNITAID Goal Healthy markets, healthy people UNITAID aims to promote “healthy”, dynamic market conditions whereby manufacturers have incentives to invest and innovate , while at the same time supply quality public health products at sustainable, affordable prices and in acceptable formulations that enable the maximum number of people to access them.
  3. 3. How UNITAID intervenes <ul><ul><li>UNITAID’s role depends upon the particular circumstances in a given market: </li></ul></ul><ul><li>Market catalyst: identifying and facilitating adoption and uptake of new and/or superior public health products; </li></ul><ul><li>Market creator: providing incentives for manufacturers to produce otherwise unattractive products with low demand that yield little profit but substantial public health benefit to those in need; and </li></ul><ul><li>Market “fixer”: addressing severe market inefficiencies (e.g. grossly inaccurate demand forecasts and excessive transaction costs) that contribute to low access to quality-assured public health products. </li></ul>
  4. 4. UNITAID Market impact framework HIV/AIDS & poor access to antiretroviral (ARV) medicines Price negotiation, demand creation, pooled purchase, information sharing, WHO PQ High ARV prices from low demand & lack of competition More people treated with less money; benefits extend beyond country recipients Lower ARV prices, more generic versions, increase in suppliers, competition & awareness UNITAID Intervention example: 2 nd line ARV market
  5. 5. Lessons learned from the past 10 years (1) <ul><ul><li>Environment, market characteristics & interventions </li></ul></ul><ul><li>Industrial structures were “simpler”: innovator vs. generic; Innovator revenues derived from high income countries </li></ul><ul><li>Unprecedented influx of HIV/AIDS funding </li></ul><ul><li>Largely donor-driven, donor-controlled market </li></ul><ul><ul><li>Policy harmonization & coordination across donors, organizations </li></ul></ul><ul><li>WHO Prequal & FDA created level playing field around quality </li></ul><ul><li>Intellectual property barriers largely absent for most ARVs </li></ul>
  6. 6. Lessons learned from the past 10 years (2) <ul><ul><li>Environment, market characteristics & interventions </li></ul></ul><ul><li>WHO treatment guidelines drove & consolidated demand </li></ul><ul><ul><li>5 ARVs on 2003 WHO guidelines constituted 98% of ARVs purchased 2004-2006* </li></ul></ul><ul><li>WHO treatment guidelines inconsistent with those in the north (treat at later stage w/ different ARVs) </li></ul><ul><li>Information on market prices available in public domain </li></ul><ul><li>RESULT: “healthy” competition, price reduction, assured quality, development of new products (FDC, paediatric) appropriate for developing country settings rapid scale-up </li></ul>*Waning et al. Intervening in Global Markets… Globalization & Health 2010, 6:9.
  7. 7. Overview of ARV market evolution
  8. 8. Future challenges for tomorrow’s market (1) <ul><ul><li>Environment, market characteristics & interventions </li></ul></ul><ul><li>Industrial structures more complicated: </li></ul><ul><ul><li>Largest revenue growth is in middle-income pharmerging markets </li></ul></ul><ul><ul><li>Innovators producing generics & acquiring generic firms </li></ul></ul><ul><ul><li>Indian generic firms moving upstream to R&D, biotech </li></ul></ul><ul><ul><li>Renewed national interest in local production: collision of economic, industrial development, and public health policies </li></ul></ul><ul><li>Flat-line donor budgets for HIV in the wake of financial crisis </li></ul><ul><li>National governments purchasing more ARVs </li></ul><ul><ul><li>N ew market anchors/powers like South Africa (25% global market) - disaggregated power & market; countries becoming big players </li></ul></ul><ul><ul><li>Quality standards no longer harmonized (national vs. global) </li></ul></ul>
  9. 9. Future challenges for tomorrow’s market (2) <ul><ul><li>Environment, market characteristics & interventions </li></ul></ul><ul><li>WHO HIV/AIDS treatment guidelines becoming more consistent with those in the north </li></ul><ul><ul><li>Treat earlier with better but more expensive ARVs </li></ul></ul><ul><ul><ul><li>Treatment as prevention may push treatment even earlier </li></ul></ul></ul><ul><ul><li>Use of CD4, viral load and other diagnostics </li></ul></ul><ul><li>Intellectual property barriers for new ARVs </li></ul><ul><ul><li>Patents, TRIPS, Free Trade Agreements </li></ul></ul><ul><li>RESULT: much more complicated market environment where market interventions used in the past no longer fit. Need to engage new players (innovators, national governments, etc) and develop new approaches to support scale-up </li></ul>
  10. 10. CD4 Product Pipeline* But lots of innovation in HIV diagnostics:
  11. 11. Viral Load & EID Product Pipeline*
  12. 12. Summary & Conclusions <ul><li>Market-based approaches are powerful interventions that support global scale-up of HIV/AIDS treatment </li></ul><ul><li>Success over the past 10 years: price reductions & development of better, quality-assured products </li></ul><ul><li>But the landscape has changed dramatically. Market evolution presents new challenges for the next 10 years </li></ul><ul><li>Need to be forward-thinking, monitoring and anticipating market evolution </li></ul><ul><li>Need new market approaches from donors, international organizations, national governments, generic and innovator manufacturers, NGOs and others to achieve universal access </li></ul>
  13. 13. <ul><li>Thank you </li></ul>Contact Information: Brenda Waning Coordinator, Market Dynamics UNITAID Email: [email_address]

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