Getting Down to Business: Expanding the Private Commercial Sector's Role in Meeting Reproductive Health Needs

May 24, 1999

Governments in developing countries have an important role to play in making reproductive health products and services affordable for the poor and other under-served groups. Accordingly, efforts to improve access to family planning and other reproductive health care have focused primarily on the public sector.

Encouraging a greater role for the private sector can allow governments to refocus their efforts on reaching the poorest and most remote communities.

However, the private for-profit sector in these countries also has enormous potential to help meet the increasing demand for good quality reproductive health care. Many developing country households earn enough to bear all or part of their health care costs, and are willing to pay for the better quality and more efficient care offered by private as compared to public health facilities. Encouraging a greater role for the private sector can allow governments to refocus their efforts on reaching the poorest and most remote communities.

The widening gap between stagnating public funding and the rapidly increasing demand for reproductive health care requires that developing nations move quickly to tap the potential of the private sector. Yet, most countries are not fully utilizing the private sector, either as a source of additional financial resources for reproductive health or as an efficient provider of services and commodities.

This study examines how developing country governments and international donors can stimulate private sector involvement in the reproductive health arena, with a particular emphasis on improving the availability of commodities such as contraceptives, drugs for treatment of sexually transmitted infections (STIs), and nutritional supplements. The report aims to help policymakers in both developing and donor countries better understand the crucial role of private business in expanding access to reproductive health care.

Many policymakers are unaware of the extent to which commercial firms are already involved in the provision of reproductive health care. Indeed, private businesses dominate the manufacture, distribution and marketing of reproductive health commodities. Many consumers obtain both commodities and services directly from the private for-profit sector.

Reliance on the commercial sector, however, varies greatly for different types of reproductive health products and services. Consumers are generally more willing to pay for curative than for preventive care. As such, they are most likely to seek out private sources for delivery and abortion services, as well as for diagnosis and treatment of sexually transmitted infections. In contrast, the commercial sector role in preventive care such as immunizations and nutritional supplementation for pregnant women is relatively insignificant.

Governments as well as international donors can have substantial influence over the climate for commercial involvement in reproductive health care.

For family planning, reliance on the commercial sector varies according to the method of contraception. Almost half of women using temporary methods that require regular resupply of commodities–for example, oral contraceptives–obtain their method from a commercial source. However, the for-profit sector serves fewer than 10 percent of women using longer-acting methods such as sterilization and IUDs.

The role of the commercial sector across countries, moreover, varies enormously, reflecting differences in the business environment that profoundly influence a firm’s decision to invest in reproductive health care. Levels of income and urbanization, along with competition from publicly subsidized programs, are among the most important social and economic factors that shape the climate for commercial activity. The size of the market, the demand for reproductive health care and the legal and regulatory framework are also important.

Policymakers generally have little control over many of these demographic and social factors in the short term. However, governments as well as international donors can have substantial influence over the climate for commercial involvement in reproductive health care over the medium and long term.