A drive to cut drug costs for malaria meets resistance

Andrew Jack | 01 May 2008
Financial Times

Down a narrow alley in Lagos's bustling Idumota market, a pharmacy is selling bright yellow-and-white packets of Coartem, one of the world's most effective malaria treatments, over the counter.

In the developed world, public health specialists worry about the dangers of such a potent drug being distributed without prescription. But in Africa, many are more concerned by another problem that limits its use: the price, which rises along with its scarcity in the most diseaseafflicted rural areas.

With more than 500m people infected and 1m dying every year from malaria, the majority of them children in Africa, pressure is growing to subsidise manufacturers' production costs of antimalarial drugs, bringing down their retail price.

This week, the United Nations-backed Global Fund to Fight Aids, Tuberculosis and Malaria - which is channelling more than $11bn (£5.5bn, €7.1bn) in donors' funds to tackle the three killer diseases - agreed in principle to take responsibility for managing the subsidy, called the affordable medicines facility.

"I'm convinced this is something we should do," says Michel Kazatchkine, the Global Fund's executive director. "People earning less than $1 a day cannot afford a drug that costs $8 and they will not walk 15km to queue up at the public clinic, but they will buy from the grocery store."

The facility has some powerful backers. The Bill & Melinda Gates Foundation, which last year called for the eradication of malaria, provided funding via the World Bank for a feasibility study. The Clinton Foundation is running a pilot programme in Tanzania. Within months, the approach could be more widespread. But there are also critics, including donors who have deferred a final decision on the Global Fund's role until November. They are concerned that the facility may distort the malaria medicines market, prove costly and ineffective and, if patients

do not use them properly, trigger resistance to one of the few effective drugs that exist for the disease.

In the late 20th century, the treatment of malaria was stalled by growing resistance of the parasite to older, cheaper and widely used drugs, led by chloroquine. The few alternative medicines available had side-effects and were costly.

Then in 2002 Novartis, the Swiss pharmaceutical group, launched Coartem, which combined the existing drug lumefantrine with artemether, a derivative of the Chinese plant extract artemisinin that had been proved effective in treating the disease.

The company positioned Coartem as part of its corporate social responsibility programme rather than a for-profit venture and sells the medicine at close to break-even. But the high cost of artemisinin means that even with its latest reduction, on the first World Malaria Day last week, the price to governments for a three-day adult course is $1, more than 10 times the cost of alternative drugs.

A sharp rise in grants from the Global Fund in the past three years has allowed many governments to buy Coartem and make it available through their public health systems for free. Mr Kazatchkine estimates that Coartem (with 160m treatments sold to date) and similar artemisinin-based combination therapies now account for 60 per cent of public sector-dispensed treatments in the countries that need them.

But because many African countries' public health systems are weak, an estimated two-thirds of malaria medicines are instead bought privately, most without prescriptions.

After distributors and retailers have taken their cut, Coartem sells in Africa for as much as $12 a packet, compared with just 5-10 cents for chloroquine. That drives most patients to opt for chloroquine, even though its efficacy continues to decline as the parasite's resistance to the drug increases.

"The crisis is both economic and biomedical," concluded a 2004 committee convened by the US Institute of Medicine, which proposed the new approach. It called for an annual $300m-$500m subsidy to manufacturers in order to bring down retail prices of artemisinin-based combination therapies to 5-10 cents. That figure is still the advocates' target.

Not everyone is convinced the money will be well spent, however. The mere fact of working outside the public health sector - let alone handing donor funds to private companies - grates with many development workers. Encouraging sales without providing proper medical advice also risks promoting drug resistance.

But a growing number of donors take a more pragmatic view. "We're committed to the idea that medicines should be available for free throughout Africa in the public sector," says Anil Soni from the Clinton Foundation. "But the reality is that it's not going to happen overnight - and we'll never bring down the use of chloroquine in the short term without dealing with the private sector."

Another worry is whether the subsidy, instead of benefiting the most needy, will end up in intermediaries' pockets - or will simply lower prices to richer urban patients. Hans Rietveld, director of global marketing and access for Coartem at Novartis, says: "The reality we have heard from many people in Africa is that it will waste donor resources and not achieve its aim."

Other concerns are that a subsidy for artemisinin could boost the market for harmful counterfeit drugs and reduce the commercial incentive for the development of a new generation of even better anti-malarial medicines.

Most fundamentally, sceptics question whether the facility is the best use of limited resources. Admiral Tim Ziener, head of the President's Malaria Initiative - a Bush administration programme that is buying Coartem for free distribution alongside the distribution of bed nets and insecticide spraying, says: "We fully support the goals. It's the economics that trouble us. The question is not whether the objective is sound but if we are past the proof of concept. I'd rather use my time and money elsewhere."

Initial results from Mr Soni's pilot programme, which has been running in some districts of Tanzania over the past few months, suggest that the subsidy has kept the retail price of privately sold artemisinin-based therapies in line with cheaper alternatives - including in remote areas with less competition - and significantly increased their use.

He has yet to convince government donors to make substantial financial commitments. But in the complex fight against malaria, efforts to experiment with innovative approaches are needed more than ever.