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176 Fighting the Diseases of Poverty
Discussion
Clearly, many urgent health concerns in the poorest parts of the
world could be addressed if existing drugs and interventions were
to be distributed properly. However, a variety of factors conspire to
prevent people from receiving the medicines they need. As we have
seen, poor road and electricity networks hinder the distribution of
drugs, as does the shortage of medical facilities such as clinics, hospitals
and pharmacies. Health insurance systems, which would
enhance access to medical care, are currently inadequate because
the governments of lower-income countries frequently fail to foster
the kind of institutional environments in which they can thrive.
But people are also denied medicines in more insidious ways.
Governments in lower-income countries impose burdensome taxes
and tariffs on imported medicines, pricing many people out of treatment.
Governments also impose often unjustifiable non-tariff
barriers, such as arbitrary licensing restrictions. At the same time,
governments nominally offer healthcare services to everyone, but in
practice they do so in ways that primarily benefit a small number of
citizens (mostly the elite) at a very high cost. As a result, government-financed
healthcare systems in such countries are often poorly
resourced and poorly managed. Meanwhile, the private sector often
is over-regulated. These glaring failures of governance help to
ensure that universal access to essential medicines remains a long
way off for many regions of the world.
The manifold failures in drug distribution also have ramifications
that reach beyond the immediate health needs. Because these
failures diminish demand for medicines, they make it less likely that
new medicines will be created. In richer countries this is less of a
problem because effective demand is higher.
Producers respond to the perceived demands of consumers,
whether those consumers are individuals, health agencies, insurance
companies or governments. (This is illustrated in Appendix
Figure 1.) This has led to the creation of a wide variety of drugs to
combat the range of disorders suffered by consumers in rich country
markets. However, in lower income countries the absolute size of