A new business model for improving access to healthcare in the world’s poorest countries

Andy Wright, Vice President Global Health Programmes at GlaxoSmithKline (GSK), discusses the company’s pioneering business model whereby 20% of profits from Least Developed Countries are reinvested to provide better access to healthcare.

The outbreak of the deadly Ebola virus in West Africa is a stark reminder of just how vulnerable healthcare systems in developing countries can be, many lacking in even the most basic health infrastructure. It also throws into contrast the wider scale of the healthcare deficit globally. The shortage of appropriately trained and resourced frontline health workers is recognised as one of the most fundamental constraints to achieving the Millennium Development Goals (MDGs).

The World Health Organization (WHO) currently estimates a global health worker shortage of around 7.2 million professionals, which is projected to grow to 12.9 million over the next two decades. In many developing countries up to one in five children die before their fifth birthday due to largely preventable diseases such as malaria, diarrhoea, respiratory infections and malnutrition. If identified and treated in time, millions of lives can be saved. Frontline health workers provide a vital link between the community and the primary healthcare system, keeping track of disease outbreaks and monitoring public health.

A few years ago we asked ourselves the question: what new approach to business could we embrace to help build health infrastructure in the world’s poorest countries? The commitment we came up with, launched in 2009, was to reinvest 20% of profits generated in Least Developed Countries (LDCs) back into projects that strengthen the healthcare infrastructure, primarily through training frontline health workers. This was a new way of doing business and is now a core part of how we think about our role in society. We recognise that as a global healthcare company, we have a crucial role to play in improving access to healthcare for people all around the world, irrespective of where they live and their ability to pay. Indeed, as population growth continues at a high rate in the developing world, there is both a moral and business imperative to do so in order to secure a sustainable business future.

Tackling the healthcare deficit and improving access to healthcare in LDCs is a complex challenge. To deliver the aims of the 20% reinvestment initiative, we have partnered with three NGOs, each leading a geographic region:  Amref Health Africa in east & southern Africa, CARE International in Asia and Save the Children in west & central Africa. Each of these organisations has been selected due to their ability to work closely with governments, local NGOs and civil society organisations in training, capacity building and advocacy around health programming. Importantly, together with our partners, we also work hard to engage with national and local governments to ensure that projects are aligned with national and regional agendas on improving access to healthcare. Working in a collaborative way is essential – we recognise that we don’t have all the answers, and are acutely aware of the need to listen to political and community representatives, as well as healthcare experts, to ensure that the money we reinvest is targeted for maximum impact where it’s needed most.

Training frontline health workers has proven to be a high impact, cost-effective means of increasing access to healthcare. Once a healthcare worker has the necessary skills and has built relationships with people in communities, they can deliver multiple health interventions. Our focus is for the initiative to most directly contribute to reducing child mortality and improving maternal health (two of the MDGs). However, it will also help to combat disease areas such as HIV/AIDS, tuberculosis (TB) and malaria (a third MDG).

Our 20% reinvestment model forms part of our pioneering Africa and developing countries unit. This team has been established with the purpose of expanding access to GSK medicines and vaccines to people across Africa and developing countries. Across the world’s 49 poorest nations, we have capped the prices of our patented medicines at no more than 25% of prices charged in developed countries. The unit’s success is not measured on profits generated, but on delivering higher volumes of lower-priced, high-quality medicines and vaccines. The idea being that by increasing the overall volume of products we sell, we are able to sustain lower prices on our essential medicines and vaccines for those most in need. This is a departure from the traditional pharma company model, but we believe it is absolutely key to improving healthcare in the world’s poorest countries.

Between 2009 and 2014 we have reinvested £15 million in improving access to healthcare in LDCs, initiating projects in 34 countries. We have helped to train 25,000 frontline health workers, improving access to healthcare for 6.5 million people. This is just the beginning.

Our approach to developing countries has helped to create a virtuous circle, building our business while also tackling an important societal need. By reinvesting in the world’s poorest communities (those at the bottom of the pyramid), we are helping to develop infrastructure that improves health outcomes, as well as building new potential markets for GSK medicines and vaccines. This in turn generates increased funds to reinvest in subsequent years.

Our ambition is to grow and expand the initiative to reach more of the world’s poorest people. By ensuring that the model is sustainable in financial terms, we can deliver long-term value for the business and for society. This isn’t philanthropy. It’s a new way of doing business, and our goal is to be a relevant and innovative partner across Africa and the developing world.

Andy Wright is Vice President Global Health Programmes at GlaxoSmithKline (GSK).

GSK’s 20% reinvestment initiative was recently recognised by Business in the Community (BITC), who named GSK winner of the Unilever International Award, supported by Business Fights Poverty, which seeks to recognise businesses that can demonstrate positive impact against one or more of the MDGs.