February 2009

Drug Resistance and Global Health Update February 2009

Dear Colleague,

Our newsletter this month comes to you fast on the heels of the January newsletter. Therefore, it is relatively brief. In addition to our regular updates, I'd like to highlight this month's thought-provoking guest column, where Prashant Yadav discusses how incentives motivate behavioral decisions that affect drug resistance.

As always, we welcome your thoughts at [email protected].

Regards,

Rachel Nugent
Deputy Director for Global Health
Center for Global Development

FEATURED COLUMN - Incentives, Informational Blind-Spots and the Emergence of Drug Resistance

By Prashant Yadav, Professor of Supply Chain Management,
MIT-Zaragoza International Logistics Program

Drug resistance is threatening our ability and the resources required to treat infectious diseases in developing countries. Countering drug resistance involves complex tradeoffs between a number of activities1. In order to formulate robust and effective strategies against resistance emergence, we need a clear understanding of the incentives of all health system actors and how these incentives interact to drive (socially-optimal2or not) behavior.

The DRWG recently commissioned a study to better understand how incentive structures might cause resistance. Findings confirmed the hypothesis that many actors across the supply chain deviate from making socially-optimal decisions. We identified three possible explanations for these deviations:

  • Actors sometimes lack the necessary knowledge and information to make socially-optimal choices (informational blind-spots)
  • Actors can often negatively affect others by their decisions (incentive misalignments arising from failure to internalize all costs)
  • Short-term choices are not always consistent with long-term socially-optimal outcomes (incentive misalignments arising from faulty future vs. current reward discounting)

An example of the latter is when actors are rewarded as a result of good immediate outcomes (e.g. providing prompt treatment or ensuring lower stock outs of drugs) rather than for good (socially desirable) long-term decisions (e.g. educating patients and the general community about the importance of infection control and preventive methods or maintaining an assortment of drugs that may lead to decreased resistance). In these cases, different rewards or incentives may be found to encourage the socially-optimal choices.

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1For example, development of new products, ensuring treatment heterogeneity, guaranteeing systemic availability and affordability of the right drugs, making certain drugs are high-quality, and enforcing compliance, adherence and rational use

2Where “socially optimal” refers to the set of decisions at each stage in the health care supply chain that minimizes the emergence of drug resistance within society as a whole without compromising access to medicines

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PARTNER RESOURCES

  • Round 3 of the Gates Grand Challenges in Global Health opens on March 31st, 2009. Round 2 had a specific call for innovative research and technologies for drug resistance and we expect this new round to as well. Click here for more information.

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