Rising Importance of Global Health Initiatives in the Pharmaceutical Industry: Trends, Challenges, and Opportunities

Leading pharmaceutical companies are increasingly focusing on global health initiatives, which has led to a rise in procurement through tenders and long-term agreements (LTAs) by Intergovernmental Organizations (IGOs) and Non-Governmental Organizations (NGOs).

In 2023, the total value of pharmaceuticals and medical supplies distributed by these entities is estimated at US$ 21.3 billion, with a significant portion allocated to vaccines, medical supplies, and diagnostics. Pharmaceuticals alone account for about US$ 4.7 billion of this total.

The Covid-19 pandemic caused a noticeable surge in healthcare spending by NGOs and IGOs in 2021, particularly in diagnostics and vaccines. Although the pharmaceutical sector experienced a decline during this period, it has been witnessing a notable upward trend since 2022, with an average year-over-year growth of over 11%.

This trend underscores the growing significance of global health teams within pharmaceutical companies.

These teams are becoming increasingly important due to various factors:

1. Shifting Disease Landscape: There’s a growing prevalence of neglected tropical diseases and infectious diseases in low- and middle-income countries (LMICs), requiring innovative approaches and partnerships for drug development.

2. Equity and Access: Heightened awareness of healthcare inequities in LMICs is pressuring pharmaceutical companies to improve access to essential medicines. Global health teams are pivotal in addressing these challenges by developing sustainable distribution models and navigating complex healthcare systems.

3. Emerging Markets: LMICs are emerging as significant markets for pharmaceuticals. Global health teams are key in helping companies understand and penetrate these markets.

4. Pandemic Preparedness: The COVID-19 pandemic highlighted the need for improved outbreak preparedness. Teams with expertise in public health and vaccine development are valuable for future pandemic response strategies.

5. Regulatory Landscape: As governments and international bodies implement policies to enhance medicine accessibility in LMICs, global health teams are crucial for ensuring compliance and navigating these regulations.

Companies are recognising that strong global health programs not only fulfill social responsibilities but also attract consumers and investors. These programs are focused on making medicines more affordable and accessible in LMICs through various initiatives.

Industry Response Includes:

• Establishing dedicated global health units.
• Engaging in public-private partnerships.
• Exploring innovative financing models.
• Investing in local capacity building.
• Developing medicines for neglected tropical diseases (NTDs).

Challenges and Opportunities:

Despite their importance, global health teams face challenges such as limited resources and the need to balance commercial objectives with social impact. However, the opportunities for significant social impact, market access, and long-term value creation are substantial. These teams play a crucial role in strengthening healthcare systems, advocating for policy change, and demonstrating the value of global health initiatives.

One major challenge is the lack of transparency and market intelligence in the sector, where a large portion of the market remains non-tender based and procurement is often local and in partnership with governments. Vamstar is addressing this challenge by combining AI-based data scraping with subject matter expertise to provide ATC class-level market insights, which are vital for shaping global health strategies in the pharmaceutical industry.