Expanding distribution and availability

MDAs can improve distribution effectiveness and reduce the costs of distribution. This section considers how social marketing, social franchising, and bottom of the pyramid approaches can play a role.

Social marketing

Social marketing has expanded distribution and availability of many health products in a variety of ways too numerous to include here. The Country case studies section provide a few examples, and more are available from the social marketing organisations themselves:

Social franchising

Social franchising aims to make quality health care services available and affordable via the private sector. It uses commercial franchising techniques which leverage branding, economies of scale and a balance of economic incentives between franchisor and franchisee. Social franchising is most commonly used in the reproductive health sector, but has also been applied in the supply of basic and essential drugs, water services, and more recently, in the supply of TB, HIV and AIDS products and services.

An MDA that has expanded access to a wide range of quality medicines and healthcare services is the CFW shops in Kenya (also known as the HealthStore Foundation). Helped by seed funding from the Bill & Melinda Gates Foundation channelled via Management Sciences for Health, CFW is a franchise network with 54 clinics and drug shops across Kenya. The drug shops have served over 700,000 patients, providing basic medicines in rural areas, whereas the more urban based clinics provide health services and products requiring a higher skilled healthcare worker.

A range of basic drugs and supplies, including family planning products, of guaranteed quality and standard price are provided by community health workers in the drug shops. The ready availability of these health workers has enabled the model to reach rural areas as has the economics of offering a wide range of products. Some of the CFW shop owners/franchisees also employ bottom of the pyramid thinking and employ itinerant sellers with some community health training. These health workers do not require (costly) premises from which to work, but they enable the franchisee to expand the potential catchment area to which he can sell product & therefore increase sales volumes. The model improves service quality and value for money as well. An additional benefit is that CFW provides the training in patient symptom management and counselling. Not only are the products consistently available at standard prices in the CFW shops and clinics, but studies have shown that competing pharmacies have had to lower their prices when CFW shops entered their region/area.

Many social marketing programmes have expanded from purely product marketing to marketing of services including family planning, sexual transmitted infections treatment, primary health care and Voluntary Counselling and Testing (VCT). GreenStar in Pakistan and Janani in India demonstrate how social franchising is used to make not only products but also quality services more available and affordable. (India case study and Pakistan case study).

Bottom of the pyramid approaches

These approaches demonstrate that it is possible to be a 100 per cent commercial venture, and still target the poor with good results. The thinking recognises that 70 per cent of the world's population has a per capita income of less than US$1,500, and 16 per cent of the world's population lives on less than US$1/day. These potential consumers have traditionally been ignored by large international companies, but in fact represent a very considerable profit opportunity, if a strategy is adopted to pursue low-cost/high volume opportunities, along with low capital intensity.

There are very many successful examples of business ventures succeeding on the basis of this realisation, perhaps some of the more famous ones being the Grameen Bank's Microfinance programme in Bangladesh and the Unilever low-cost detergent “Wheel” in India . For further background on the bottom of the pyramid concept, see What works: serving the poor, profitably.

A purely commercial pharmaceutical network in India, and now other parts of Asia, called the Medicine Shoppes demonstrates how the commercial sector is creating more efficient distribution in poor countries. This franchise, a subsidiary of the US-based Cardinal Health, the world's fourth largest community pharmacy franchise, is the largest chain of pharmaceutical retail outlets in India , with shops operational in Mumbai, Navi Mumbai, and at several other cities in Maharashtra, Gujarat, West Bengal, Goa, Karnataka and Andhra Pradesh. The Medicine Shoppe franchise prides itself in the value-added services that the franchisee provides beyond merely selling quality drugs. For example, it offers SMS reminders for medicine refills, free and periodic medical camps and free diagnostic services.