The Contribution of the Pharmaceutical Industry to the Health Status of the Developing World

Abstract

There is sufficient evidence to prove that the improved health status of a nation’s citizens results in economic growth and development via improved functionality and productivity of labor. It is also commonly accepted that healthcare expenditure significantly influences health status through, for instance, improving life expectancy at birth and reducing morbidity, death, and infant mortality rates. Within healthcare, medicines account for a considerable share of health-related expenditure in both developed and developing countries. Therefore, it seems reasonable to assume that improved access to medicines is likely to contribute not only to the well-being of families and individuals but also to the economic growth and development in all societies. It has been widely advocated that pharmaceutical multinational enterprises (MNEs) can play an important role to address this problem, as they develop and supply a significant proportion of the drugs imported by low- and middle-income countries. This chapter is dedicated to a systematic review of literature in order to identify the strategies implemented by pharmaceutical MNEs to improve access to medicines in the low- and middle-income countries. A total of 76 research articles have been identified, and we have found that the main strategies of pharmaceutical MNEs are related to improving health outcomes through R&D, establishing partnerships for product development, pricing strategies to improve access to medicines, technology transfer, licensing agreements, and nonmarket efforts to improve access to medicines, among other strategies to overcome barriers imposed by intellectual property rights. We have also found that pharmaceutical MNEs’ strategies take place within a complex system and often involve interactions with a wide range of actors, such as international organizations, governments, private not-for-profit sector, universities and research institutes, and generic manufacturers. However, there is still a need for major progress in the field of access to medicines, and pharmaceutical MNEs should be more active in this field in order to avoid potential negative consequences, such as loss of legitimacy and compulsory licensing of their patented medicines.

Citation

Urias, E. (2017), "The Contribution of the Pharmaceutical Industry to the Health Status of the Developing World", International Business & Management (International Business and Management, Vol. 33), Emerald Publishing Limited, Leeds, pp. 41-67. https://doi.org/10.1108/S1876-066X20170000033003