Either patients can’t afford the medicines or suppliers can’t afford the risk.
Too often, market forces deny the world’s poorest people access to the medical supplies they desperately need. This is a chicken-and-egg problem, governed by real and perceived risks in supplying proven healthcare technologies to untried markets.
Take the example of a new hepatitis diagnostic. Theoretically, the manufacturer could enter a new country with low prices and aggressively build out sales and customer service teams. But this strategy depends on large and predictable demand. Will the government recognise the advantages of the new product over existing ones? Even if they do, what if funding dries up, or their national hepatitis treatment programme fails to scale up?
Buyers face mirror-image uncertainty. They could start ordering large quantities of the new diagnostic at today’s prices, hoping prices fall over time. But what if prices stay the same and break the budget as the national hepatitis programme scales up? Equally, can they rely on strong customer service from the supplier, or will malfunctioning instruments be left to languish?
The net result of all this uncertainty is a cycle of inaction, with suppliers and buyers moving cautiously, taking small steps in response to small steps, waiting for signals from the other side of the market. Prices remain high, demand grows slowly, and patients suffer the consequences.
Guaranteed sales volumes reduce the price and the risk.
In recent years, a financing concept has emerged with unprecedented potential to answer the chicken-and-egg question. Volume guarantees give suppliers a form of safety-net insurance to take a bolder and more patient-friendly approach to market entry.
With a volume guarantee, suppliers can offer lower introductory prices, build their sales and customer service presence rapidly, and ultimately deliver life-saving products to patients in need far more quickly than before.
MedAccess is the first of its kind: a global institution, built on sustainable finance, capable of delivering volume guarantees with speed, scale and professionalism.
How our volume guarantees work
MedAccess provides a medical supplier with a legally binding contract that sets out maximum prices in return for assured sales volumes. If actual sales fall below this threshold, we pay the supplier to make up the difference.
The elegance of volume guarantees creates powerful advantages over other potential solutions:
1. We estimate guaranteed volumes prudently to minimise the risk of payout while offering the supplier the security they need to take bold first-mover action.
2. We do not get involved in individual transactions between buyers and suppliers, but rather transform market dynamics for new healthcare technologies without skewing incentives or creating inefficiencies.
3. Our capital is reusable, enabling exponential health impacts in evermore under-served markets.
We stimulate healthcare markets that work for everyone.
Imagine a future where a transformative new cancer therapy developed in Germany is widely available in Malawi as quickly as it is in Australia. As demand for this drug proliferates across Africa, prices fall in lockstep. Several generic suppliers enter on the heels of the originator to create competitive supply. The market actively begins to serve the poor.
This is the world MedAccess is working towards. We believe that patients in the poorest corners of the globe deserve health outcomes no worse than patients in the wealthiest countries. To achieve this vision, markets must serve all patients equitably, offering rapid and sustainable access to the best possible technologies.