Public-Private Partnerships: GLOBAL HEALTH PANACEAS?

Photo courtesy of the World Health Organization's Photo Library

Photo courtesy of the World Health Organization's Photo Library

By Janelle Winters

Nearly one billion people worldwide received preventative drug treatments for at least one disease in 2015, according to the World Health Organization’s (WHO) recently released report on integrated control of neglected tropical diseases. Much of this record-high treatment has been accomplished through mass-drug administration with drugs donated from pharmaceutical companies, in partnership with the WHO. In current WHO Director General Margaret Chan’s words, such public-private partnerships (PPPs) ‘bring science to bear on the most neglected diseases’. In fact, the WHO report boldly states that the sustainable development goals (SDGs) ‘can be realized only’ through ‘strong commitments’ to global partnerships between governments, the private sector, and civil society.

This resounding embrace of the PPP model raises many questions for those who work outside of health policy (and certainly some in it). What exactly are PPPs, and what different forms can they take? When did PPPs start to become so popular, and what forces have driven many governments and multilateral organizations to embrace them so wholeheartedly? Are there risks for global health PPPs that we should be thinking about? And, how can we tell when health PPPs are effective and whether they are indeed promoting equitable access to public goods and services? These questions are obviously well beyond the scope of a single blog. This post aims to provide a broad-sweeping, introductory view on what health PPPs are, and why we should care about them as a society. Keep an eye out for my follow-up blogs in the coming months, which will discuss the wider drivers, risks, and evaluation frameworks for global health PPPs!

What are PPPs for health, and what types of activities do they support?

Health policymakers have often disagreed on what arrangements actually qualify as PPPs. In the words of a group at Stanford commissioned by the WHO to study the effectiveness of PPPs in global health, the ‘huge enthusiasm’ for PPPs internationally has often not corresponded to agreement about ‘what constitutes a PPP and under which circumstances the approach is preferable’.

One well-cited PPP definition is offered by the World Bank’s PPP Knowledge Lab: a PPP is a long-term contract between a private party and a government entity, for providing a public asset or service, in which the private party bears significant risk and management responsibility, and remuneration is linked to performance.

Six key attributes of health PPPs stand-out in this definition:

  1. Public – Generally, this means governmental institutions and administrators (at any level – national, provisional, state, district, etc.), and all other government and intergovernmental agencies tasked with delivering public goods.
  2. Private – What constitutes a private organization in a PPP has been hotly contested; today, it is generally understood to include both for-profit organizations (commercial enterprises of any size) and non-profit organizations (NGOs, philanthropies, etc.).
  3. Partnership – Typically, this means that a formal relationship is formed between the public and private organizations. The relationship is task oriented, long-term, and includes an agreement about shared risks and benefits.
  4. Length of time – PPPs generally differ from contractual arrangements, in that they are planned over the long-term, often for 10+ years.
  5. Risk – The partnership should have risks for both the public and private parties. This makes it different from some types of contractual arrangements.
  6. Services – For health PPPs, these generally mean public goods, services, or equipment, like products (vaccines, drugs, microbicides) and health facilities (access to hospitals, clinics, diagnostic tests).

If this all sounds simple and straight-forward, think again! The boundaries around PPPs can be quite blurred. For instance, in my research on the Onchocercaisis Control Programme, I initially thought that the programme’s Chemotherapy Project for drug development would surely count as a PPP, perhaps even the earliest PPP for health. The Chemotherapy Project was initiated by an intergovernmental agency (public), included formal agreements for product research and development with multiple pharmaceutical companies (private, partnership) beginning in 1981 and spanning through 2002, and was all about discovering and providing drug candidates (goods/services) for treating a disease of the poor.

However, many PPP scholars argue that ‘true’ PPPs did not rise until after 1990. It seems that the risk for the Onchocerciasis Control Programme was primarily on the shoulders of the WHO and programme donor states (the public party) – rather than the pharmaceutical companies (the private party) – and most formal agreements with the private companies were for short-term duration (contracts). Instead, a programme that developed from the Onchocerciasis Control Programme, the Mectizan Donation Programme, better fits the Bank’s PPP definition. In it, the pharmaceutical company Merck was given more decision-making authority and risk, and this formal partnership for drug delivery has now lasted for over 25 years. Yet, this hasn’t stopped the World Bank and other sponsoring agencies from claiming the Onchocerciasis Control Programme as a model for successful PPPs! This example underlies the importance – and difficulty – of distinguishing between PPPs, contractural agreements, and privatization (the permanent transfer of control or ownership from public to private entities, like under some World Bank structural adjustment programmes).

One of the reasons that PPPs can be hard to consistently define is that a very wide variety of programme arrangements are included under the PPP banner. Sania Nishtar, who lost the race for WHO Director General to Tedros Adhanom this week – took a stab at categorizing different types of PPPs for health in her widely-cited 2004 article:

These categories provide a good overview of the different goals of health PPPs. However, they are far from universally accepted, and some PPPs may fit into more than one category. The World Bank’s African Health Forum has instead broken-apart PPPs for health based on whether they provide public services or hospital services. A big take-home point is that most health PPPs are dedicated to product development or access to services for specific diseases. According to Initiative for Public-Private Partnership for Health’s (IPPPH) data from the mid-2000s, about 80% of the PPPs for health were for disease-specific activities, with only one of 80 projects targeted at general health system strengthening. This means that they tend to tilt the health financing balance towards vertical, at the expense of horizontal, interventions.

So, why should we care about health PPPs?

Both PPPs and extra-budgetary (voluntary) funding at multilateral institutions have dramatically risen over the past fifteen years. About half of Sub-Saharan Africa’s total health expenditures go to private facilities, and the World Bank Group estimates that $25-30 billion in new investments is needed over the course of the decade to meet the basic health needs of Sub-Saharan Africans. Institutions like the World Bank Group’s International Financing Corporation (IFC) are encouraging private investments (often in the form of PPPs) in the health sector, through ventures like the hotly-contested Health in Africa initiative, to meet these needs.

About 80% of the United States’ (the world’s largest funder of development assistance to health) resources to the developing world now come from foreign direct investment, private donations, and other sources of non-governmental aid – compared to less than 30% around 1980. Such reliance on private aid and PPPs is likely to increase with Donald Trump’s proposed cuts to United States official development assistance, as governments seek to fill health funding gaps. The WHO Director General elect, Dr. Tedros, is also likely to support funding through PPPs, as he has served on the boards of major PPPs, like Roll Back Malaria, the Global Fund, and the Partnership for Maternal, Newborn and Child Health.

With these trends comes an increasing prominence of private sector voices in global health policy decision-making – and questions about investment transparency and equitable access to health services. Stay tuned in June and July for more on why the health PPP landscape has evolved, and how health policymakers can better understand PPP’s influence on health provisions!