Co-Authors: Parag Vaidya, CFO, Associate Partner, KOIS; Karthik Subbaraman, Associate Partner, Healthcare Practice Lead, KOIS; Aditya Andhansare, Analyst, KOIS; Dhananjay Vaidyanathan, Managing Partner, Alstonia Impact; Chandni Goel, Associate, Alstonia Impact
5 minutes read
1. The fight against Tuberculosis in India
With the highest burden of Tuberculosis (TB) patients, estimated at ~2.8, TB remains a pressing public health concern for India. India faces an additional stark challenge: the county carries 27% the world’s burden of Multi-Drug resistant TB (MDR TB) as of 2022[1]. On paper, TB is a curable disease, and the treatment is relatively cheap[2] and effective[3]. In practice, it is a complex disease to tackle. MDR TB is harder and much more expensive to treat.
2. We are making progress
Due to the high level of attention of the government towards TB, the situation is indeed improving: the gap in formally identified TB cases (“notified cases” in TB parlance) vs WHO estimates of actual cases is reducing (from 1.2 million to 0.5 million in the last 5 years[4]), the number of TB patients which are treated is increasing (+4% compound annual growth rate (CAGR) from 2017 to 2022[5]), the number of people who lose their lives because of TB is decreasing (-2% CAGR in the same period[6]). Notably, the government has successfully embraced partnerships with private providers to increase notifications and improve treatments.
3. Public capital is not going to be enough to eliminate TB
To match the ambition of its goals, the government dramatically increased the budget for TB from USD 219 million in 2012 to USD 671 million in 2023[7]. This is nearly without parallel in any country but may not enough to bend the curve: the number of active TB cases remained almost flat in the last 5 years (‒1% CAGR from 2017 to 2022), and if people keep on getting infected, the ambitious target of eliminating TB from India by 2025 is unlikely to be achieved. To reduce transmission, significant additional resources are needed. The prospect of another substantial increase in public budgets appears remote, necessitating the infusion of private funds to bolster the TB eradication efforts.
4. How private capital and blended finance can help to bend the curve
Blended finance, which leverages both private and public capital, emerges as a potent tool in this scenario. Blended finance has already been used on a small scale in the fight against TB in India. For example, between 2019 and 2023, through the multi-impact bond[8], blended finance was leveraged to improve the nutrition and treatment outcomes of TB patients. A volume guarantee executed by MedAccess in 2021 for 3HP (3-month weekly doses of Hisoniazid Plus rifapentine)[9], a TB preventive therapy, helped increase the availability of the treatment globally. Furthermore, in 2022, through the SAMRIDH Healthcare Blended Financing Facility, funds were provided to Qure.ai, enabling the scale-up of their Artificial Intelligence (AI)-enabled chest X-ray screening software[10].
The TB landscape showcases several additional avenues where blended finance can play a role. These include opportunities across the cascade of care, from prevention to treatment. Addressing these challenges requires innovative solutions and strategic financing mechanisms.
The following table outlines specific challenges faced at different stages of the TB care cascade, proposes tailored solutions, and suggests potential blended finance instruments to support these initiatives.
| Challenge | Care cascade stage | Solution | Potential blended finance instrument |
|---|---|---|---|
| Government’s NGO partners face significant cash flow challenges, lacking sufficient funds to cover operating expenses during the intervals between payment cycles | Multiple | Provide access to working capital to smaller NGOs working as PPIAs | Working capital loans / Medical Credit Funds for NGOs and social enterprises for uninterrupted cash flow |
| Limited testing and access to treatment for latent TB: Due to constrained resources, the emphasis on addressing latent TB remains insufficient. In 2021, only 12% of eligible patients received treatment for latent TB | Prevention | Holistic solution to tackle latent TB:
|
Pay for Performance / Performance based contracts for improving patient detection, improving patient adherence and incentivize implementing partners (Similar to US PEPFAR) |
| Drug-resistant TB has higher mortality rates, and access to shorter treatment regimens is currently limited. The community transmission of MDR-TB is particularly challenging as it can spread a strain of the disease that is resistant to standard treatments | Treatment | Help increasing the availability of TB testing and treatment (with a focus on MDR TB / XDR TB Extensively Drug Resistant TB (XDR TB)) in private sector facilities and support the patients through insurance products or financing to access the treatment | Advanced Market Commitments (AMCs) and Volume Purchase Guarantees for lowering purchasing costs for newer advanced diagnostics and newer drug regimens that have shorter treatment regimen |
| A significant proportion of Drug Sensitive TB patients (7-32%) and a majority of Drug Resistant TB patients (68%) in India face catastrophic costs for TB care[11] | Treatment | Help TB patients to afford complete treatment through dedicated insurance products which include OPD |
|
5. The way forward
An innovative financial model can significantly accelerate the fight against tuberculosis, bringing India closer to its ambitious goal of eliminating TB.
The way forward could involve a thorough exploration of potential solutions, focusing on identifying the most effective technologies for TB prevention, testing, and treatment. This includes evaluating successful operating models that can be adapted or scaled in the Indian context and determining the most suitable blended finance instruments to support these initiatives. Following this, the implementation of a small-scale pilot project is crucial. This pilot will test the identified solutions and financial models, allowing for close monitoring and evaluation of their impact and feasibility on a smaller scale.
[1] https://www.who.int/teams/global-tuberculosis-programme/tb-reports/global-tuberculosis-report-2023
9789240083851-eng.pdf (who.int)
[2] About 8 USD/month per patient, and the treatment can last 3-6 months
[3] 90%+ cure rate, when the treatment is adhered to
[4] From 2017 to 2022. The latest available figures from WHO are for year 2022
[5] https://iris.who.int/bitstream/handle/10665/274453/9789241565646-eng.pdf https://www.who.int/teams/global-tuberculosis-programme/tb-reports/global-tuberculosis-report-2023/tb-diagnosis—treatment/tb-treatment-and-treatment-coverage
[6] https://www.who.int/teams/global-tuberculosis-programme/tb-reports/global-tuberculosis-report-2023/tb-disease-burden/1-2-tb-mortality
[7] https://app.powerbi.com/view?r=eyJrIjoiMGIwZDUzMmItODE5Yi00YjAzLTliMGEtNGVhMGVlYzA4YWVkIiwidCI6ImY2MTBjMGI3LWJkMjQtNGIzOS04MTBiLTNkYzI4MGFmYjU5MCIsImMiOjh9
[8] https://www.ipeglobal.com/mukti-pay-for-performance-program-india/
[9] https://medaccess.org/improving-availability-of-patient-friendly-tuberculosis-preventive-therapy/
[10] https://www.qure.ai/news_press_coverages/usaid-supported-samridh-healthcare-blended-finance-facility-supports-qure-ai-to-strengthen-indias-healthcare-systems
[11] Catastrophic cost is defined by the total cost related to TB management exceeding 20% of the annual pre-TB household income.
