In a first-of-its-kind move by a large drug maker, Novartis (NVS) raised approximately $2.1 billion last week by selling bonds that are tied directly to its progress in making medicines accessible in certain low- and middle-income countries.
Specifically, the stated goal is to expand the number of patients who receive its brand-name medicines by at least 200% by 2025, as well as programs that market medicines to combat leprosy, malaria, Chagas, and sickle cell disease by at least 50% over the same period. If the company fails to meet those expanded access goals, however, investors will receive higher interest payments.
“It’s a question of getting innovative medicines to these countries,” said Patrice Matchaba, who heads global health and corporate responsibility at Novartis. He explained that part of the challenge is to further reduce the time lag between making medicines available in wealthy nations and the rest of the world. “We’re confident we can do that because we have the organization needed in those countries.”
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Novartis deserves points for innovating in a historically boring space (corporate bond market) but not so much on the social impact on this one. Expanding market access in LIMCs is a growth opportunity for every business. Too much emphasis is placed on the product a company happens to sell, when social impact is really about how it operates its business and where it contributes to communities along the entire value chain.
May one observe that while I am sure our scribe has faithfully copied the Novartis numbers in the last line, the idea that each recipient of NVS largess got $30,000 / USD “last year” is ________ [fill in the blank].
NOTE – I did that calculation by eye, and rounded same.