Boosting the local supply security of diagnostics in low- and middle-income countries
Strengthening the capacity of LMIC diagnostic companies to reliably and sustainably supply quality diagnostics to meet local and regional health needs.
An estimated 47 percent of the global population has little to no access to diagnostics. The 2021 Lancet Commission on Diagnostics analyzed existing gaps and barriers to appropriate diagnosis in low- and middle-income countries (LMICs), especially across the African continent. One major finding, highlighted through the COVID-19 pandemic, determined that local research and development (R&D), manufacturing, and distribution of diagnostics are limited, contributing to their lack of affordability and availability in LMICs. Most LMICs lack the necessary health infrastructure, investment climate, and robust regulatory environment to sufficiently meet diagnostic product and service demand across the health system.
Diagnostic companies that are local to target markets are uniquely positioned to strengthen access and may be more likely to offer products that suit regional health needs. Local manufacturing could strengthen supply security of critical medical technologies in underserved regions and improve the chain of care offered to individuals and communities.
This initiative aims to strengthen the capacity of LMIC-based diagnostic companies to develop, manufacture, supply, and distribute quality local products by facilitating investments in and increasing technical assistance directly to local diagnostic companies. In doing so, these innovative and growing diagnostic companies will gain access to the required financial and technical resources to build internal R&D, manufacturing, regulatory, quality, and commercial capabilities. These investments will allow LMIC-based companies to become reliable local and regional diagnostics suppliers thereby improving equity and access.
Boosting the local supply security in emerging markets
PATH has undertaken a three-phased approach to identify and structure target investments for LMIC-based diagnostic companies to support their capacity to serve as high-quality, reliable, regional suppliers of diagnostic products. This has included:
- Identifying investable companies and opportunities based on country and region-specific diagnostic priorities
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- Develop a database of companies located in, and supplying diagnostics to Africa, Asia, and Latin America
- Landscape the regional diagnostic ecosystem to determine diagnostic needs, supply security challenges, and company pain points and opportunities.
- Identify market failures and market-shaping interventions needed for LMICs to close the existing diagnostics gap.
- Map and match local market needs and demand gaps with local diagnostic companies.
- Developing business cases for local investments through a needs assessment and market gap analysis
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- Identify diagnostic companies in LMICs with high potential to develop, manufacture, and/or distribute quality diagnostics to meet local, regional, and global demand.
- Prioritize and down-select findings against criteria of mission alignment, health impact potential, and capacity to leverage capital investments for growth.
- Determine partner pain points and capacity-building gaps through an engagement and discovery process of selected companies.
- Engage with multiple development financing institutions to determine investment priorities and ensure a suitable approach.
- Characterize down-selected investment opportunities and technical assistance required to build capacity to meet needs and supply quality diagnostics reliably and sustainably; Engage with companies directly to develop business cases.
- Assessing, prioritizing and executing investment opportunities
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- Build out priority investment opportunities for identified local diagnostic companies in alignment with interested investor objectives and goals.
- Analyze the return on investment (ROI) including an impact analysis on the potential to improve market access, supply security, and potential economic impact.
- Provide technical assistance to support the execution and sustainable management of identified opportunities.
- Engage development finance institutions, interested investors, and other key stakeholders throughout to ensure clear communication and sharing of opportunities and constraints.
Interactive dashboard of diagnostic companies in low-and middle-income countries
In Q2 2023, PATH hosted a virtual convening that highlighted promising opportunities for development finance institutions and interested investors to support LMIC-based diagnostics companies through a presentation of business cases and innovative funding models.
Resources
- Identify market failures and market-shaping interventions needed for LMICs to close the existing diagnostics gap. This report highlights existing market failures across the diagnostics value chain and provides recommendations for expanded access to quality diagnostics in low- and middle-income countries.
- Regional assessment of diagnostic needs in Africa
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