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42 Diagnosing Corruption in Ethiopia
• Consolidating procurement in a specialized agency such as the PFSA
has the potential to substantially improve the quality of procurement.
However, the benefits of consolidation also come with the risk of concentrating
opportunities for abuse. Therefore, the government would
be well advised to establish strong independent oversight for the
PFSA.
Pharmaceuticals
Within health systems, the production, sale, and distribution of pharmaceuticals
are recognized as particularly vulnerable to corruption.
Pharmaceuticals are highly regulated, markets are restricted, and manufacturers
are often politically and economically powerful. It can be costly
for regulators and purchasers to assess the quality and efficacy of pharmaceuticals.
For all these reasons, as figures 2.2 and 2.3 previously enumerated,
abuse and fraud are possible in almost every transaction involving
pharmaceuticals—influencing policies, manipulating decisions about
which drugs to include in national drug lists, corrupting prescription practices,
overprescribing, encouraging kickbacks in procurement, and supplying
substandard products. Corruption in drug system management can
happen at any stage in the process, from basic research to prescription and
use (WHO 2006). The following processes are especially vulnerable:
• Drug selection for the national formulary. As in most countries, Ethiopia
has a list of registered medicines that can be legally imported, produced,
and distributed. The process for including medicines in such a list can be
corrupted by manufacturers who either want to sell products that do
not meet accepted standards or want to exclude competitors. The most
common way to insulate drug registration from abuse is to establish a
procedure for disinterested individuals to serve on a public committee
that applies explicit criteria according to established procedures.
• Medicine promotion. Pharmaceutical manufacturers and distributors
can manipulate the public through advertising or improperly influence
health professionals to increase profits at the expense of patients or
patient health. Few developing countries have effective policies to regulate
medicine promotion.
• Pharmaceutical inspection. Manufacturers, distributors, and retailers can
evade regulations by corrupting inspectors, with detrimental impact on
health and safety.
• Drug distribution. A variety of corrupt practices can also occur at all
points where drugs are distributed, prescribed, purchased, or sold to
patients.