Health research initiatives begins in The Philippines, $800 Million US Dollars

Laboratory Medicine -Manila Doctors Hospital

A new law is expected to boost medical research in the Philippines, potentially opening doors to greater private sector involvement in the health services industry.

On May 7 President Benigno Aquino ratified legislation passed by the parliament earlier this year that formalizes the Philippine National Health Research System (PNHRS) and establishes the Philippine National Health Research Fund.

The PNHRS's main role will be to set policies and directions, periodically review and approve long-term plans and programs, and evaluate and approve the national health research agenda. The PNHRS will be governed by a council headed by the secretary of science and technology and the secretary of health, with representatives from the Commission on Higher Education, the chancellor of the University of the Philippines-Manila, the executive director of the National Nutrition Council, the director of the Philippine Council for Health Research and Development, as well as five representatives from the private sector.

The PNHRS itself is not new, although formalizing its status and funding marks a policy change. The program was initially set out in the middle of the past decade to finance the training of more health scientists and provide the necessary resources for undertaking research aligned with the government's health strategies. Among the key agencies involved in the scheme are the Department of Health; the Philippine Council for Health Research and Development (PCHRD), an agency under the Department of Science and Technology that serves as the national coordinating body for health research; and the Commission on Higher Education.

Research and development work to be conducted within the remit of the PNHRS will in part be financed by the higher taxes on cigarettes and alcohol that went into effect on January 1. The price of cigarettes is expected to double by 2017, while the cost of a bottle of beer is will rise by P23.50 ($0.56). The PCHRD will receive 10% of the revenues collected, which will then be used to fund the PNHRS.

This would represent a significant financial boost to health research, as official estimates put the earnings from the so-called sin tax at $800m for 2013, thus potentially channeling $80m into the system this year alone.

According to Juan Edgardo Angara, a representative in parliament and one of the authors of the PNHRS bill, the program will provide a framework to strengthen cooperation among the various stakeholders in health research, including private sector players.

"The country must provide for a favorable research environment wherein government agencies, non-government organizations, public and private hospitals, academic institutions and private agencies can optimize their research activities," Angara said.

The Aquino administration has already been pushing to encourage greater private sector involvement in the health care industry. Through its public-private partnership program, the government has partially corporatized some hospitals and health centers, opening them up to private investment and management. With the PNHRS fully operational, there will likely be greater support for private research projects, which could benefit such segments of the economy as the pharmaceutical sector, with the $14bn industry currently growing at a rate of between 3% and 4% each year.

Even with additional funding and a structure to steer and monitor health research activities, it will take time for the Philippines to address structural weaknesses. At present, the country is lagging in most international assessments of research support. Spending on research is around 0.03% of national health expenditure, well short of the 2% recommended by the World Health Organization. Total outlays on research and development in all fields, not just health, account for just over 0.1% of GDP, according to the World Bank, compared to Singapore's 2.37%.

By building capacity for research and development, the PNHRS will help fuel the innovation that could ultimately improve the health of the nation.

Oxford Business Group

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