Efforts to increase the poor’s access to medicines are nothing new. Buying products from quality manufacturers (innovators and the best generics) and pressuring them to lower prices for the poorest markets has worked best, but other policies have largely failed or are still on the drawing board. The latest strategy – to encourage local pharmaceutical production – may not only fail to increase access but could also be entirely counterproductive. It could lower drug quality and increase incentives for protectionism, and, as a result, ultimately reduce access.
Production of drugs in poorer countries can make sense, but it must be driven by entrepreneurs responsive to market incentives. Unsuccessful local businesses must be allowed to fail, not be propped up by aid groups that support local production without considering its longer-term economic consequences. This would encourage better, more profitable businesses, which will be the engines of growth for poor nations. The next few months will be a test of whether the international community encourages quality production or indirect protectionism