Tackling Corruption to Make African Medicines Supply Chains Efficient

Lenias Hwenda

Geneva Switzerland.  Lenias is passionate about improving access to quality affordable treatments.

The WEF in identified health inequality as a major issue that will shape global development in the coming years. According to the WHO Director General, Dr Margaret Chan, health inequalities are often aggravated by high prices of medicines. Prices for medicines would be substantially lower if procurement and distribution processes were more efficient with reasonable mark-ups and free of corruption. Limited financial resources  and the growing trade in counterfeited medicines, a huge proportion of which are sold in African countries are major consequences of corruption world wide. Corruption constrains  growth and development of countries. We need to address it in order to promote health as major driver of economic growth and sustainable development.

The enormous scale of the global medicines market makes it an attractive target of corruption. At an estimated $30 billion in 2016 with projections to grow to $65 billion by 2020, the African medicines market is not immune to this problem. Corruption remains a major obstacle to strengthening the supply chains of medicines in African countries. It reduces the availability of affordable quality medicines.

A social enterprise like Medicines for Africa with a mission to improve the availability of low cost, quality treatments for African people must reflect upon the complex problems of corruption, its multiple facets and create measure to counter it. This is important because corruption or the perception of corruption erodes trust which undermines supply chain efficiencies which raises the cost of medicines. Medicines being one of the largest components of health expenditure, it is important for African countries to ensure efficiency in their procurement processes in order to be able to achieve better value for money. 

On the way to patients, the supply chain of medicines involves many steps with many participants that include agencies, ministries, service providers, manufacturers and patient representatives. Their respective roles and responsibilities, accountability and relationships are often not clearly defined. This complexity increases the supply chain’s vulnerability to corruption by providing numerous opportunities for it. Corruption in the medicines supply chain can take many forms.

These include the falsification of evidence, bribery or special influence on the selection of medicines and suppliers by countries, international agencies and development partners. Asymmetries in the availability of information’s to decision-makers along the supply chain, pharmaceutical companies, regulators, healthcare providers and patients add to the problem. 

A common misconception is that African countries are the only corrupt ones in the world, but corruption is a transnational problem. It happens in all countries, rich and poor alike, the difference being how it affects society at large. The many forms of corruption in African countries are matched by the multiple ways that multinationals and development partners are complicit in them. For example, more than half of members of the OECD anti-bribery convention violate their obligations by failing to investigate or prosecute any foreign bribery cases. Limited enforcement of existing laws deprives African countries of resources that could help strengthen public infrastructure.
 
What is unique is the impact that corruption has on rich and poor countries. Wealthier countries have stronger institutions that reduce the impact of corruption on efficient service delivery to society. In poorer countries, weak institutions that are under resourced and has poor infrastructure and capacity magnifies the negative impact that corruption has on efficient provision of public services with disproportionate impact on poor vulnerable people.
 
Corruption diverts funds and investment needed to strengthen infrastructure and ensure supply chain security and value for money. In the medicines supply chain, wasting resources that are already limited increases transaction costs and reduce the availability of affordable quality medicines. Corrosion of medicines supply chain integrity promotes organized crime such as the trade in counterfeited medicines. Inefficient processes of procurement that lack transparency can undermine interest among suppliers in competing for procurement contracts. This reduces the choice of suppliers leading to fewer choices and higher prices for medicines. Coercive decisions imposed by governments, development partners, multilateral organizations and multinational corporations also results in countries paying excessive prices for medicines. 
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All kinds of tools for fighting corruption exist. They include anti-bribery legislation. Laws that prevent, detect and punish corruption can go a long way in deterring it but only if they are enforced by all countries. Therefore, it is necessary to address the numerous blind spots in countries and in the global anti-corruption architecture, for instance, by addressing issues of tax havens that deprives countries of huge sums of money. Oxfarm estimates that $500 billion a year lost to African countries is held in offshore tax havens and according to the AfDB, each year the continent loses $14 billion in tax revenue and $50 billion in illicit financial flows.
 
We all have a part to play in mitigating against corruption. Organizations like Transparency International and Global Finance Integrity are challenging the culture of tolerance and impunity by African countries and their counterparts. These efforts require governments to act when corrupt funds flow out of or through their financial systems. Multinational corporations should exercise social responsibility by considering the long-term cost of corruption to poor vulnerable people. International and development organizations should increase their scrutiny on how development funds are used and civil society should hold leaders both in government and business accountable. Civil society in particular can create positive social pressure on transparent decision-making and improve enforcement of measures that counter corruption.
 
Mitigating against corruption require greater political will and ethical leadership from business and governments of African countries and their wealthier counterparts. Demands for transparency and fairness are growing in African countries, forcing African leaders to be accountable. There is also a growing number amongst a new generation of African leaders who are more concerned about how their leadership can positively impact people’s lives. Such leaders have left me convinced that things can change and are indeed changing. Their success requires the support of development partners and business leaders. Medicines for Africa has come up with a set of measures to mitigate against the impact of corruption on the availability of quality affordable medicines working with countries and partners. When we work together, medicines supply chain challenges may not be as intractable as they seem.