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Health impact fund – better incentives for better medicines

The current system for development of medicines gives unfortunate incentives, and in many cases do not make the most needed medicines available – particularly for poor people. This is due to the incentives that promote marketing of drugs to sell as much drugs as possible for as high price as feasible – independent of the health impacts the drugs have. Does it really need to be like this?

An argument often used to defend the current system is that development and testing of new medicines is costly and is associated with financial risks as not all good ideas translates into successful products. However, there are other alternatives to compensate for the risks while giving better incentives for production of the most needed medicines. Not only that. This will be beneficial not only for the health of the patients, but also reduce the total economic costs related to medicines in the health systems.

The Health Impact Fund – a better solution

Thomas Pogge og Aidan Hollis are the pioneers behind the suggestion The Health Impact Fund which makes a smart twist to the incentives. The idea is that development of better and more needed medicines should be economically favourable rather than to sell more of well-marketed medicines for higher prices. The twist in the incentives will give the producers, the health clients and health systems common aims and interests. This will reduce the morbidity and mortality burden more while reducing the health expenses compared to the current system.

Another consequence of The Health Impact Fund is that health monitoring will be improved as it is a necessity for the approach. Starting the fund does not need to cost particularly much. A total of 0.03 % of the budgets in the respective countries, which is only a fraction of what is used on medicines today, is sufficient to have a have a sustainable fund. This will also reduce the health costs for medicines over time.

To summarise, The Health Impact Fund will promote better access and innovation of the most needed medicines to more affordable prices than today’s system. Thus, it is time to put the idea of Pogge and Hollis into practice. To read more about the solution, visit the web site of the Health Impact Fund.

References:

www.incentivesforglobalhealth.org

http://www.yale.edu/macmillan/igh/#

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