Anthony Rosendo Faraon, MD, MPH Zuellig Family Foundation Donn Mc Angelo T. Valdez, MD

2. Using the Flagship Framework on Pharmaceutical Reform in Improving Access to Essential Medicines in the Public Sector Anthony Rosendo Faraon, MD, MPH Zuellig Family Foundation Donn Mc Angelo T. Valdez, MD MeTA Philippines Secretariat

3. The Flagship Framework on Pharmaceutical Reform • Decade-long program developed by the World Bank Institute and the Harvard School of Public Health for health sector reform for low- and middle-income countries • Offers a way of thinking and an analytical method • Specialized course on pharmaceutical reform for Medicines Transparency Alliance

4. The Flagship Course on Pharmaceutical Reform • Held last January 8-14, 2010 at Jordan • Participated by the seven MeTA pilot countries • Philippine delegation: • 2 from government (DOH and PHIC) • 2 from the private sector (PHAP and Zuellig Family Foundation) • 2 from the CSO • 1 from MeTA Philippines

5. The Reform Cycle IDENTIFY THE PROBLEM MONITOR AND DIAGNOSE THE EVALUATE CAUSES IMPLEMENT DEVELOP A PLAN GET POLITICAL APPROVAL 5

6. Problem identification • Performance problems vs. system failures • Performance goals: • Ultimate: • Health status • Citizen satisfaction • Financial protection • Intermediate: • Efficiency • Quality • Access

7. Role of Politics and Ethics in Problem Definition • Politics: how questions will be decided • Ethics: how questions should be decided • Problem definition is inevitably political • Competing views about what the goals of a good society should be come to play

8. Role of Cost in Problem Definition Performance 6 B 5 4 7 3 A 2 8 1 9 Cost

9. Role of Cost in Problem Definition Choices at Point A: The system is not efficient • Lower cost, even if performance suffers • Minimize cost for current performance • Improve performance and lower cost • Maximize performance at current cost • Better performance, even if costs rise

10. Variations in Attitudes Toward Cost • The Department of Health typically argues the nation is at A and urges move #6 • They don’t want to admit inefficiency exists • They want more money • The Department of Finance generally claims the nation is at B and urges move #3 • They don’t believe that the system is efficient • They want to save money

11. Role of Cost in Problem Definition The system is efficient—it is at Point B • Higher cost and higher performance • Lower cost and lower performance Irrational moves no matter where you are • Higher cost, same performance • Higher cost, lower performance

12. Diagnosis • Diagnostic journey: asking why five times • Market failures: • Arising from buyer behavior • Arising from seller behavior • Government failures • Problem definition • Policy design • Policy implementation

13. Policy Development • Process of policy development matters: substance and political and social legitimacy • Political acceptability and any potential implementation difficulties should be anticipated

14. Policy Development: The Control Knobs • A set of features of the health sector • These features can be altered by public policy • Changing the “setting” on the “knob” will change system performance

15. Policy Development: The Control Knobs • Financing—Where the money comes from • Payment—How providers, suppliers and sellers are paid • Organization—How functions are divided among organizations and their internal managerial structures • Regulation—Requirements imposed by the state • Persuasion—Efforts to influence providers and consumers

16. Political approval • Pharmaceutical reform is unavoidably political • Doing better requires political skill, not just political will • Stakeholder analysis (actors, position and power) is a starting point • Successful reformers develop strategies to affect political outcomes

17. Implementation: Reasons for Failure • Senior leaders (e.g. ministers) lack managerial sophistication and turn over quickly • Implementation is not considered in program design • Entrenched interests resist • Countries lack resources • Systemic problems are not addressed (e.g. corruption or civil service limits) • Political support dissipates

18. Monitoring and Evaluation • Should be planned at the policy design stage • Good evaluation requires data to be collected before a new policy is initiated

19. The Cycle Often Begins Again Poor design or flawed implementation leads to unsatisfactory results Even successful reforms can create new problems Actors defend their interests in unanticipated ways Economic or political conditions change Flagship Course, Saturday January 9, 2010 Session 1 19

21. The flagship framework as applied in improving the access to essential medicines in the public sector

22. ACCESS

23. Access as intermediate performance goal • Performance goals: • Ultimate: • Health status • Citizen satisfaction • Financial protection • Intermediate: • Efficiency • Quality • Access

24. Access • Concept with multiple definitions in the pharmaceutical sector • Includes whether patients can easily take advantage of goods (medicines) or services that either … they want to use OR … healthcare managers want them to use.

25. Sub-components of Access • Physical availability: Are the appropriate medicines available at specific location? • Effective availability: Are there barriers to patients who want to acquire the medicines? • Price • Distance • Service hours • Cultural appropriateness

26. Access vis a vis availability of essential medicines in the public sector • Why is it important? • Influences utilization and, in turn, health status • Major determinant of citizen satisfaction • Subject to a great deal of political discussion • Politicians frequently think of access as an end in itself

27. TRANSPARENCY IN PROCUREMENT

28. PROCUREMENT • Technically demanding • Large sums of money • Requires trained and conscientious staff • Process is a major source of corruption

29. Transparency in procurement process • How widely is it advertised? • How explicit are the evaluation criteria? • Are the evaluations made public? • Is there an appeals process? • Etc.

30. Improving Performance in the Public Sector • Extensive public health delivery system organized hierarchically • Such facilities may be underutilized because they lack staff, equipment and supplies and provide poor service quality • Public sector medicines supply chains often function poorly • Flawed procurement • Poorly operating distribution system/reorder system • “leakage” • Price barriers

31. Tweaking the organizational control knob to improve access to medicines in the public sector

32. What is the Organization “Control Knob”? • A set of policies and interventions which change the organization of a country’s health/pharmaceutical system • Designed to improve system outcomes: health status, satisfaction and risk protection • Often undertaken along with changes to other control knobs

33. The Six Keys to Organizational Performance System Structure 1- Incentives on the Organization 2 – Incentives on Managers 3- Managers’ Skills, Beliefs and Values 4- Managers’ Authority 5- Incentives on Workers 6- Workers’ Skills Beliefs and Values Worker Behavior Organizational Performance System Performance

34. Thank You! Anthony R.G. Faraon, MD, MPH Program Manager, Zuellig Family Foundation

35. ACCESS AND UTILIZATION • The Flagship Framework distinguishes between access and utilization • It considers access a supply side concept • It refers to what is available to potential consumers • Utilization (i.e. use) depends on both supply and demand • For example, consumers could have access to, and still not use, a medicine because they preferred not to • Some writers use access to mean use, that is a lack of use by definition reflects a lack of access