21 January 2011

Growing the Contraceptives Market

May Plano Ako
The government through the Department of Health (DoH), recently launched the "May Plano Ako", a US-conceptualized family planning program on population control and reproductive health.

An enhanced contraceptives and birth control marketing strategy, the program highlights the role of the private sector in the government's family planning program. It may also provide a way out of the controversial Reproductive Health (RH) Bill.

Assured to further enrage the Catholic Church and perk up multinational pharmaceutical companies, the Aquino administration is poised to implement the program.

Grand Plan

The United States Agency for International Development's (USAID) Health Promotion and Communication Project or HealthPRO conceptualized the "May Plano Ako" program based on targets set to achieve the country's Millenium Development Goals or MDGs.

US-based agencies have allotted grants in line with the country's RH programs. House Deputy Majority Leader Janette Garin, co-author of one of the pending RH bills, revealed that DoH would be able to draw on a USD1.2-million grant from the United Nations Population Fund (UNPF) for reproductive health projects in rural areas.

She added that Malacanang also earmarked a part of the USD434-million grant from Millenium Challenge Corporation to allow the country to reach its MDGs on maternal and child health care.

Out of the 2011 health budget, P932 million was appropriated for family planning and development. House Minority Leader Rep. Edcel Lagman, primary author of the Reproductive Health bill, said he would work to double the funding for RH to P2 billion.

HealthPRO and the National Center for Health Promotion (NCHP)were reported to have trained 607 nurses and midwives and 2,217 barangay health workers in 11 provinces on "interpersonal communication and counseling on family planning, and maternal and child health.”

An additional 700 health service providers and 3,000 barangay health workers will be trained in 12 other provinces.

Selling Contraceptives

A "multilevel, synchronized and holistic marketing approach to family planning," is the focus of the program. It aims to increase modern contraceptive use by increasing the demand.

Based on "The Family Planning Behavior Change Communication Strategy" of the NCHP, the program's approach is said to be unique in that it generates demand for contraceptives, and aims to market them effectively.

During a Senate hearing, DoH Secretary Enrique Ona disclosed that DoH allocated P280 million for pills, P100 million for injectibles, and P8 million for condoms in its 2011 proposed budget. Money was allocated to purchase two million condoms that would be made available to Filipino couples.

The objective of USAID's contraceptives social marketing is to expand access of its client countries to contraceptives by privatizing their distribution and marketing. The idea is to work with commercial sector to supply contraceptives to sales outlets, including pharmacies, kiosks, and other highly accessible locations, which distribute, promote, and sell contraceptives.

Triple i Consulting, a business development and marketing consulting corporation, places Philippines as the 11th most attractive pharmaceutical market in the APAC region, and third biggest market in ASEAN after Indonesia and Thailand.

It also reveals that fourteen of the top 20 pharmaceutical companies in the world have manufacturing facilities in the country. More than 70 percent of the pharmaceutical market in the Philippines is controlled by the biggest foreign pharmaceutical companies.

From 2004 to 2008, the demand for medical and pharmaceutical products in the Philippines relied on an increasing importation demand at an annual average rate of 12 percent. In 2009, it projected importation at USD736 million.

Fiscal and non-fiscal incentives also provide more perks for foreign pharmaceutical companies. Fiscal incentives include income tax holiday, special tax rate on gross income for IT Park/Eco-zone locators, tax and duty exemption on imported capital equipment, exemption from Value Added Tax on allowable local purchase of goods and services, and additional deduction for labor expense. Among the non-fiscal incentives include the unrestricted use of consigned equipment, exemption from wharfage dues and export tax, duty, impost and fees, employment of foreign nationals, and the issuance of Special Investors Resident Visa.

The "May Plano" program of the DOH, which takes on the public-private paradigm of government, is not the first of its kind that USAID has been designing and suppporting. The Private Sector Mobilization for Family Health (PRISM) project was previously implemented under the Arroyo administration.

Launched in October 2004, PRISM's goal was to catalyze the private sector as a vibrant and dynamic partner of the government in meeting the demand of Filipino families for family planning and maternal and child health products and services. It encouraged pharmaceutical companies to market affordable contraceptives and trained private health workers to become entrepreneurs.

Based on the USAID document released in June 2005 entitled "Support to Contraceptive Social Marketing in the Philippines, Performance and Prospects," the objective of the PRISM project was to help increase the size of the commercial contraceptives market, and was designed to support suppliers, not consumers.

Public-Private Partnership in RH

While no particular study accounts for the specific impact and benefits to Filipino families of USAID assisted planning programs in recent years, other stakeholders are greatly profiting out of these.

DKT Philippines, local counterpart of non-profit organization DKT International which designs and implements social marketing programs in several countries, started its social marketing campaign in 1991 by introducing Trust condoms. Since then, Trust has become the leading condom in the market, its website boasts.

It thanked the USAID for its corporate success after entering a USD3.1 million agreement in 2002 to support social marketing of modern contraceptive methods. USAID has funded the marketing expenses associated with launching and growing of Lady Pill and Depotrust injectable as well as marketing for Trust Classic condom. This NGO is also receiving grants from other sources.

In 2009, DKT sold over 29 million condoms, over 21 million oral contraceptives, almost 2 million injectable contraceptives, and over 100,000 IUDs. USAID, in its 2005 report, revealed that DKT Philippines had a total income of P558 million in 2004. It accounts for the sales of Trust pill and Trust condom as well as Frenzy and Trust Premiere reaching around 80 percent of DKT's sales revenue in 2004.

RH Bill Debates Exit

Lawmakers warned that this family planning program would allow the President to disregard the debates over RH bill, a contentious matter since the filing of the measure.

"The belief that you need an RH bill for government clinics to start giving out condoms and pills is a myth," Inquirer online quoted Zambales Rep. Mitos Magsaysay. “It can be quietly done through appropriation. If Congress cannot give birth to an RH law, then [President Aquino] can father an illegitimate offspring through administrative conception.”

The lady solon pointed out that despite being the most expensively lobbied bill in Congress and despite almost a billion pesos spent by its foreign backers, RH bill never had a breakthrough in the past years.

"[The Aquino administration will] short-circuit the process and take the administrative route [because the RH bill] faces stiff resistance across party lines, and in both houses of Congress," she said.

Davao City Rep. Karlo Alexei Nograles believes that RH and family planning do not need a law, as the "RH hullabaloo" is all about profit for contraceptive makers.
Gabriela Women's Party (GWP), however, asserts that there is a need for an RH bill that does not merely zero-in on the debate regarding population control. As the group said, "controlling the ballooning population alone should not be the focus of a reproductive health program but should also look at the welfare and health of Filipino women."