Central supply-side purchase of drugs and educational materials tends to be inefficient and leads to shortages. We believe this matters because few stakeholders are inherently motivated to defend the public interest.
Therefore, under this logic, the government must ensure that facility managers have free access to several distributors competing with one another. In Europe and the USA, the law prohibits conflicts of interest because monopolies typically reduce welfare. However, this does not seem to stop several organizations from Europe or the USA from promoting public input monopolies in low-income countries.
The case of the Democratic Republic of Congo:
Monopolization of essential drugs distribution was imposed in DRC through provincial distribution centres with the argument that it would assure good quality drugs. Several Cordaid studies conducted between 2006 and 2008 in the province of South Kivu did not support this argument for monopolies. They showed that the monopolization of essential drugs by international NGOs and government in two districts created serious drug stock-outs in health facilities. Patient satisfaction studies among 200 households and interviews with health workers confirmed the stock-outs. In contrast, in two health districts that applied PBF and allowed health facilities to purchase essential drugs from any distributor accredited by the provincial health authority, there were no drug shortages (Soeters et al., 2011).
