Expanding Access to Medicines: Aligning Profits with Global Health Equity

21/12/2024

The pharmaceutical industry is at a turning point. While scientific advancements are unlocking life-saving treatments at an unprecedented pace, equitable access to these innovations remains a pressing challenge. The COVID-19 pandemic has heightened awareness of global health disparities, with employees, citizens, and stakeholders calling for responsible and equitable access to medicines. For the industry, this is not only a moral obligation but also a prerequisite for sustainable growth in an increasingly interconnected world.

Unlocking Opportunities in Underserved Markets

The 2024 Access to Medicine Index underscores the immense opportunity for pharmaceutical companies and investors to expand access to medicines in low- and middle-income countries (LMICs). Nearly 80% of the global population resides in these regions, and this proportion continues to rise as demographics evolve. However, many LMICs remain underserved, relying heavily on expensive imported medicines, which are often out of reach for local populations. Past health crises provide valuable lessons. "For example, collaborative efforts during the HIV/AIDS crisis—between local manufacturers, public health organizations, and global pharmaceutical companies—led to a more than 60% reduction in HIV-related deaths and new infections. Similarly, the pandemic spurred collaborations to improve vaccine distribution worldwide. These successes highlight how targeted, collaborative strategies can make a lasting impact in underserved regions. Moreover, the health landscape in LMICs is evolving. While infectious diseases remain a priority, non-communicable diseases (NCDs) like cancer, diabetes, and cardiovascular disorders are becoming increasingly prevalent. As emerging markets adopt more Western lifestyles and lifespans increase, demand for chronic disease management and advanced therapeutics is rising. This presents a significant growth opportunity for investors and pharmaceutical companies.

The Investor’s Role in Expanding Access

Investors play a crucial role in driving the industry towards equitable access. By backing companies that prioritize affordability and availability in their access strategies, investors can help open new markets while supporting societal progress. Emerging economies in regions such as Southeast Asia, Africa, and Latin America are experiencing rapid growth in healthcare demand. In fact, healthcare now ranks among the top five industries driving economic expansion in these regions, with several multinational pharmaceutical companies generating 20–30% of their revenues from LMICs.

To maximize their impact, companies need to adopt innovative access models, such as:

Technology transfers: Sharing production expertise with local manufacturers to ensure medicines are affordable and locally available.

Voluntary licensing agreements: Allowing generic manufacturers to produce patented medicines in LMICs, expanding access while maintaining revenue streams for originator companies.

For example, initiatives like the Medicines Patent Pool have demonstrated how voluntary licensing can bring life-saving treatments to millions at a fraction of the cost, while fostering goodwill and market recognition for originator companies.

Additionally, companies can bolster their reach through not-for-profit programs that complement commercial operations. Such initiatives not only expand access but also strengthen pharmaceutical firms’ reputation as leaders in health equity, fostering trust and long-term loyalty in emerging markets.

Rethinking Innovation in Pharma R&D

Despite its reputation for innovation, the pharmaceutical industry has often focused its research on the more lucrative high-income markets, leaving LMICs underserved. Diseases prevalent in these regions, such as drug-resistant infections or neglected tropical diseases, remain underfunded in R&D pipelines. However, these conditions pose risks that transcend borders, impacting global health. Holistic R&D strategies that address the unique needs of LMICs are crucial for creating a resilient global healthcare system. For instance, developing cost-effective treatments for diseases like tuberculosis or affordable insulin for diabetes can address significant unmet needs while opening profitable new markets. Investors have the power to encourage such shifts in focus by advocating for R&D investments that prioritize health challenges in underserved regions.

Balancing Profitability with Responsibility

The pharmaceutical industry can learn from global consumer brands like Apple and Coca-Cola, which have achieved near-universal market penetration by adapting their strategies to different regions. While healthcare products are less substitutable than consumer goods, the industry has yet to achieve similar scale in accessibility. Top-performing companies in the sector demonstrate that balancing profitability with social responsibility is not only possible but essential for long-term success. Patient-centric access models, such as flexible pricing strategies or early product registration in LMICs, demonstrate how aligning commercial goals with societal needs can yield significant financial returns. For instance, companies that streamlined vaccine distribution during the pandemic gained both market share and reputational benefits. The 2024 Access to Medicine Index highlights a range of innovative solutions, from tech-enabled supply chain optimization to new financing models, that can help pharmaceutical companies reach more patients while maintaining robust growth. According to the index, Bristol Myers Squibb, Novartis, Novo Nordisk, Pfizer, and Sanofi have introduced models designed to enhance access to their products in 102 low- and middle-income countries (LMICs) included in the Index, covering all 48 low-income nations. However, the actual patient reach of these models is still unclear.

A Call to Action for Investors and Companies

The path forward is clear: pharmaceutical companies and investors must embrace access-oriented strategies as part of their long-term growth plans. Expanding access to medicines is not just a moral imperative; it is a business opportunity that aligns profitability with purpose. By investing in companies that prioritize local availability, affordability, and holistic R&D, stakeholders can unlock untapped markets, build resilient healthcare systems, and contribute to meaningful societal progress. The pharmaceutical industry has the tools, resources, and expertise to achieve healthcare access at scale. What is needed now is a shift in priorities—from treating equitable access as a secondary goal to making it a cornerstone of business strategy. Investors who recognize this opportunity can position themselves as leaders in a global movement that transforms healthcare, drives sustainable growth, and builds trust in the industry’s ability to deliver for all.

Dubai’s Rise - Asia's gold hub in BRICS' new economic corridor.

UAE becomes second-largest gold hub with over $129 billion in trade - Surpassing UK

For decades, the global gold trade has been dominated by Western financial hubs like London and New York. However, the influence of Asian nations is growing, driven by rapid economic growth, increasing demand for gold, and shifting geopolitical dynamics.

The UAE, particularly Dubai, has become a central player in this transformation. As the world’s second-largest gold trading hub, Dubai acts as a crucial bridge, connecting gold-producing regions like Africa and Russia with gold-consuming markets such as India and China.

After overtaking the UK to secure its position as the second-largest gold trading hub, the UAE is now poised to strengthen its role further. It aims to establish a new “gold economic corridor” in collaboration with BRICS nations. This initiative highlights the UAE’s ambition to serve as a global hub for the gold trade.

A recent report by the Dubai Multi Commodities Center (DMCC) underscores significant changes in the global gold trade, signaling an emerging “Asian century” for gold. The report emphasizes the development of a gold economic corridor among BRICS countries, including the UAE, which could serve as an alternative to traditional Western gold hubs.

This collaboration seeks to establish trade networks that are less dependent on Western markets. By facilitating gold trade among themselves, BRICS nations aim to reduce reliance on the U.S. dollar, which dominates global gold pricing and transactions.

As Ahmed Bin Sulayem, Executive Chairman and CEO of DMCC, remarked, “In recent years, we have witnessed historic shifts in the precious metals market, driven by Western sanctions that have forced record buying of gold by central banks and a rethink by many countries when it comes to their reliance on the U.S. dollar. We are seeing a new gold corridor form across Asia, with Dubai at its center – exemplified by the UAE’s rise to become the world’s second-largest gold trading hub last year.”

This effort aligns with the broader BRICS agenda of challenging Western financial dominance and signals a redistribution of power in the global gold trade.

Implications for the Gold Trade

The increasing influence of Asian markets, with hubs like Dubai, Mumbai, and Shanghai, reflects a shift in global economic power. This “Asian century” showcases Asia’s growing dominance in global trade and finance.

The gold economic corridor has the potential to create alternative pricing mechanisms and trading platforms, challenging the long-standing monopoly of Western financial hubs. This development mirrors larger economic shifts as emerging markets and non-Western nations work to establish independent systems for trade, finance, and governance.

Such changes could have far-reaching implications, including greater financial stability for participating nations and the potential to inspire other regions to adopt similar strategies.

Why Central Banks Are Buying Gold

Western sanctions, especially on countries like Russia, have led many nations to reassess their dependence on the U.S.-led financial system. Gold, being a universally recognized safe-haven asset, has become a strategic reserve for central banks.

Countries are diversifying their reserves away from the U.S. dollar to reduce geopolitical risks. This trend gives the UAE a strategic advantage, as its location, tax-free trade zones, and world-class infrastructure position it as a pivotal force in the global gold trade.

Role of Technology in Driving Growth

The DMCC report also highlights how technological advancements are reshaping the gold market. Innovations such as AI-driven exploration, autonomous mining techniques, blockchain-based tracking, and digital gold investment platforms are transforming how gold is sourced, traded, and invested.

“This is a time of both opportunity and challenge,” said Feryal Ahmadi, Chief Operating Officer at DMCC. “As the gold industry navigates this rapidly evolving landscape, we are committed to collaborating with our members and partners to establish the world’s premier ecosystem for the global precious metals trade from Dubai.”

Shaping the Future of the Precious Metals Market

The UAE-India Comprehensive Economic Partnership Agreement (CEPA), implemented in May 2022, has significantly boosted trade between the two nations. By reducing tariffs on key goods, including gold, the agreement has strengthened the UAE’s position as a vital trading partner. India can now import up to 160 tonnes of gold annually from the UAE at a reduced 5% import duty, compared to the 6% duty from other markets. This has enhanced trade flows and supported economic growth in both countries.

This example demonstrates how trade liberalization can promote smoother trade. Governments and businesses can benefit from lowering tariffs, removing customs barriers, and expanding bilateral agreements like CEPA. Such measures not only combat smuggling but also enhance liquidity and improve price discovery.

Additionally, the report emphasizes supporting artisanal and small-scale gold mining (ASGM). Governments should provide financing, training, and access to formal markets to boost safety, environmental standards, and economic development while reducing smuggling. By investing in advanced technologies like AI and eliminating harmful practices such as mercury use, the sector can become more sustainable and efficient.

The global gold trade is undergoing a historic transformation, with Asia emerging as a key player in reshaping the industry. With Dubai at the center, the UAE is leveraging its strategic location, trade alliances like CEPA, and technological innovations to bridge East and West. By embracing sustainable practices, liberalized trade policies, and cutting-edge technology, the gold industry is set to thrive in this evolving landscape, creating opportunities for governments, businesses, and investors alike.