Read the abstract and get a link to the full article here.
The main objectives of the project, sponsored by the Bill and Melinda Gates Foundation and the Clinton Health Access Initiative, were to examine the spatial/geographical differences in the availability and prices of subsidized drugs in three regions of Tanzania.
This project first developed a new approach for measuring “remoteness” of a retail outlet, drawing from existing approaches used in trade and market access economics, geographical information science (GIS), and supply chain management. GIS analysis and statistical regression models were then used to compare the availability, prices, and sourcing patterns of drugs between remote and non-remote areas.
This is the first study that shows the impact of demand and supply side factors on product availability in remote retail outlets.
One interesting finding is that in most places, competition between retail pharmacies results in lower prices, improved customer service, and better stocking of essential medicines. But in Tanzania, competition is just not about having a cluster of shops near each other. Having a high influence shop with a social link to the community is what drives price, quality, and quantity, and is what motivates shops to become better.
Results from the study were presented to the World Bank at a special event in February, and at the Production and Operations Management Society (POMS) annual conference in April. The study also is one of the key studies being used by several global agencies and the board of the Global Fund to Fight AIDS, TB and Malaria to understand the impact of the subsidy for the antimalarial drugs called artemisinin combination therapies.
A second paper from the project is ready for submission to “Health Policy and Planning,” and a third is under preparation for “Applied Economics Review.”