prices are high enough, relative to local low-income wages, to pose significant affordability problems (Cameron et al. 2009). One often-cited explanation for those prices is high private sector markups that accumulate as products move through successive stages of the distribution system. Noncompetitive market structures at various points in the production and distribution chain are also blamed for those markups and for high prices generally. Complaints about poor public sector performance typically focus on availability. Supply chain failures and high levels of stock-outs are a frequently identified problem. Observers also complain about high costs and delays in public procurement and about the poor quality of the products that are acquired. In addition, there is the question of whether governments can afford certain expensive medicines (especially antiretrovirals [ARVs] and artemisinin-based combination therapies [ACTs] ), which are effective but whose normal international price puts them beyond the reach of lowincome country budgets. The selection of products available in the public sector has also been contentious in some contexts, particularly whether a country’s essential medicines list should or should not include new and expensive on-patent products (Heuser 2009) (see case study A, “Defining an Essential Medicines List in Sudamerica”). Less frequently, some countries have focused on inappropriate overuse in the public sector. That is sometimes attributed to the absence of co-pays or to the desire of clinic providers to move patients through as quickly as possible. Other problems that have been identified are farther up the causal chain; in effect they are explanations of the problems already discussed. For example, some reformers focus on consumers, on their relative lack of information, their irrationality, or their poverty, as the causes of poor choices, and the magnitude of their financial burdens. Others focus on government policies that increase medicines prices. Examples here include retail taxes on pharmaceuticals and efforts to promote domestic producers even at the expense of higher costs (and lower quality). Still others point to general governmental weaknesses (corruption, low salaries, and poor management) as explanations of both inadequate direct provision and faulty regulation of the private sector.
Relating Identified Problems to Performance Goals How do all of these different problems relate to the ultimate performance goals reviewed in chapter 3? As figure 4.1 shows, the connections are numerous and overlapping. One way to summarize the preceding paragraphs is to say that reformers 56
Pharmaceutical Reform