New business models for antibiotic innovation.

The increase in antibiotic resistance and the dearth of novel antibiotics have become a growing concern among policy-makers. A combination of financial, scientific, and regulatory challenges poses barriers to antibiotic innovation. However, each of these three challenges provides an opportunity to develop pathways for new business models to bring novel antibiotics to market. Pull-incentives that pay for the outputs of research and development (R&D) and push-incentives that pay for the inputs of R&D can be used to increase innovation for antibiotics. Financial incentives might be structured to promote delinkage of a company's return on investment from revenues of antibiotics. This delinkage strategy might not only increase innovation, but also reinforce rational use of antibiotics. Regulatory approval, however, should not and need not compromise safety and efficacy standards to bring antibiotics with novel mechanisms of action to market. Instead regulatory agencies could encourage development of companion diagnostics, test antibiotic combinations in parallel, and pool and make transparent clinical trial data to lower R&D costs. A tax on non-human use of antibiotics might also create a disincentive for non-therapeutic use of these drugs. Finally, the new business model for antibiotic innovation should apply the 3Rs strategy for encouraging collaborative approaches to R&D in innovating novel antibiotics: sharing resources, risks, and rewards.

Public-Private Partnership Design for Inclusive Cocoa Global Value Chains in Ghana

Within 10 years, there could be a severe global shortage in the supply of cocoa, according to industry practitioners and other experts. Due to global population growth and the emergence of a growing global middle class, by 2025 the cocoa crop would need to increase by nearly 50 per cent to keep up with projected demand. A potential shortage of supply is a direct threat to the business model of lead firms – including cocoa grinders and processors, chocolate confectioners, and retail distributors. But these international firms – the ones that will suffer the most if there is a shortage of cocoa supply – are helping create the market failure that is stifling sustainability. Functioning as a two-tiered consolidated oligopoly with a combined market share of approximately 89%, these firms enjoy the largest portion of value capture in the cocoa-chocolate global value chain (GVC). The smallholder cocoa producers, conversely, are trapped in low value-add segments of the GVC. In fact, most smallholder farmers survive on less than $1.00 per day per capita, on average in many cocoa exporting countries. In Ghana - the second largest producer of cocoa in the world - the government has accomplished little to help these smallholders upgrade and make cocoa an attractive sector for the next generation to inherit. The result – both in Ghana and around the world – is a lack of sustainability of the supply of cocoa. Demand is already beginning to outstrip supply. As a result of these underlying circumstances, the United States Agency for International Development (USAID) has posed the following policy question: "Under what conditions could USAID, as a development agency, support and enhance potential public-private partnerships in order to improve the bargaining power (and financial wherewithal) of smallholder organizations and farmers in the context of the global value chain for cocoa in Ghana?"