Private-Public Contrasts in Commodity Supply: The Elephant in the Room?

Over the past two decades, foreign aid support for essential public health commodities has grown exponentially. Initially, only contraceptives and vaccines received significant financial support through foreign aid, but, more recently, there has been a sea change in commodity support with "new essential drugs" -- for Malaria, TB and HIV/AIDS -- benefiting from a surge in direct financial support through the Global Fund, PEPFAR, and other mechanisms. However, while there are private sector initiatives receiving foreign aid support (such as the social marketing of contraceptives and bed-nets) the focus of foreign aid financing, both for direct financial support for essential health commodities and the indirect support (such as strenghthening procurement and supply chain management) has been on the public sector. These public sector focused investments continue despite the well-known human resource constraints and corruption issues in the public sector, and, more importantly, despite evidence that access and availability may be better in the private sector, or perceived as such by the public. Using data from the Demographic and Health Surveys (DHS), National Health Accounts (NHA), the Service Provision Assessments (SPA), and a variety of individual reports, this presentation analyzes the basis of current donor investments in commodities in light of available data on access and choice. The focus is on malaria products in Kenya, Tanzania, Uganda and Zambia, but both contraceptives (which have received donor support for a much longer period and for which support is now eroding) and treatments for sexually transmitted infections (which can be viewed as somewhat neglected commodities) are used to contrast the situation with malaria products. In addition to access and choice, issues such as the potential for substandard and counterfeit products and leakage from the public to the private sector are considered.