Adapting our business model

Enabling greater access to medicines is at the heart of our business. We are determined to do what we can to use our resources, knowledge and expertise to help improve people’s health and well-being no matter where in the world they live.

But committing to this goal is just the beginning. Working towards it while at the same time building a sustainable business poses a significant challenge: how does a healthcare business make a difference in the world’s poorest countries and still turn a profit?

This is the question we asked ourselves several years ago, as we looked at the healthcare problems in 49 of what the United Nations identifies as least developed countries (LDCs). Sub-Saharan Africa, where most of these countries are found, has 24% of the world’s health burden, but only 3% of the health workers and just 1% of the global health budget. Both adult and child illness and death rates are high, sapping these societies of the opportunity to grow and prosper.

We recognised that change was needed if we were going to significantly improve access to healthcare in these countries, and one of the things that needed to change was the industry’s business model in these countries.

In 2010 we created the Developing Countries and Market Access operating unit, a dedicated group focused entirely on the LDCs. “The Developing Countries unit brings a focus to expand access to medicines for people in developing countries,” explains the head of the unit, Duncan Learmouth. “It is a bold step that gives us the flexibility to do things differently and to move more quickly.”

The unit has a 50/50 split in its goals - to improve access to healthcare and to grow a sustainable business for the long term. It has different rules from the other parts of the business – with the emphasis on volume of medicines supplied rather than revenue generated.  It also has a different pricing policy, and caps the prices of our patented medicines and vaccines at no more than 25% of the developed world prices. 

Perhaps most radically, we have committed to reinvesting 20% of profits we make in LDCs back into projects that strengthen healthcare infrastructure in these countries.

The approach is to work in partnership with NGOs, governments and private companies to train healthcare workers and educate people on basic healthcare.

Since May 2011, we have been working with our three charity partners - Save the Children in West Africa; AMREF in East and Southern Africa; and CARE International in Asia - to provide training for up to 10,000 health workers, reaching over five million people.

 “The unit’s ultimate goal is to be part of the solution, rather than simply sit back and wait for things to change”, explains Duncan. “We recognise that not all the least developed countries will be LDCs forever. “

Key fact

  • keyFactsImage 25%

    In LDCs, our patented medicines and vaccines are capped at 25% of developed world prices.