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date: 09 December 2019

The Health Economic-Industrial Complex (HEIC) and a New Public Health Perspective

Summary and Keywords

The health economic-industrial complex concept was developed in Brazil in the early 2000s, integrating a structuralist view of the political economy with a public health vision. This perspective advances, in relation to sectoral approaches in health industries and services, toward a systemic approach to the productive environment, focusing on the dimensions of innovation and universal access to health. Health production is seen in an interdependent way, recognizing that the different industrial and service sectors have strong articulations that need to be integrated. The shift toward a universal care model that focuses on human and social needs requires a productive knowledge base that favors promotion, prevention, and local and permanent healthcare, requiring new productive patterns of goods and services and innovation. Therefore, these dimensions are not conceptually apart from each other, considering an analytical and political point of view.

The production, care, and sustainability of universal health systems are understood in an integrated and systemic way. Within this vision, a cognitive leap is presented in relation to the traditional health economics, linked to the allocation of scarce resources, to a vision of health political economy that favors the development, expansion, and transformation of the health system and its economic and industrial base. Health is conceived as a moral right of citizenship and a vital space for the development of countries (and for global health), generating social inclusion, equity, innovation, and a possibility for the cooperation between countries and peoples.

The Brazilian experience is an exemplary case of association between the development of theoretical conception and its implementation in the national health policy that led to the link between economic development policies and social policies. It was possible to advance both conceptually in terms of a vision of health and social well-being and in contributing to a new paradigm of public policies. This perspective allowed the guidance of guide industrial development and services toward the human needs and universal health systems, considering the challenges brought by the context of an ongoing fourth technological revolution.

Keywords: health technology and innovation, health economics, pharmaceuticals, vaccines, biologicals, health equipment and products, health development, global health and asymmetries, health systems sustainability

Brazilian Context and Policy Perspective: The Health Economic-Industrial Complex in the Context of the Brazilian Health Unified System

Brazil is one of the most populous countries in the world (in 2018, the Brazilian population was 208 million according to its official national statistics agency, Instituto Brasileiro de Geografia e Estatística [IBGE]) that has defined health as a universal right in its constitution. The system building follows the principles of universality (universal access and not just universal coverage), equity (in terms of people and regions), and integrality (involving from primary care to highly complex and costly treatments, as in the case of those required for cancer). Health is defined as a right of the citizen and a duty of the state, which poses an enormous structural challenge, aggravated by the conditions of economic and social global crisis started in the late 2000s, to guarantee access to health in a context of a middle-income country and with a welfare state still in formation—very different, for example, from the European universal systems.1

This challenge, in a more comprehensive perspective of health, involves articulation of several dimensions of public policies and of the development process in its economic and social aspects. It manifests very intensely in many areas of public health in the field of products and services that are at the frontier of knowledge. Nowadays, universal access must be integrated with many productive and knowledge fields as biotechnology, new materials and equipment, vaccines, medicaments for immunotherapy, and the use for information technology and the innovations that come from the fourth technological revolution and affect the health system as a whole (big data, artificial intelligence, and so on).

At least three dimensions stand out from a broader and systemic perspective of health, ranging from the biological factors of the condition of life to the economic and social factors.

In the social dimension, Brazil has undergone a complex process of epidemiological transition, in which noncommunicable chronic diseases have acquired an increasing weight in the burden of disease (Silva Júnior & Ramalho, 2015). Over the course of the 20th century, diseases of the circulatory system, cancer, and mental diseases, together with external causes (violence and traffic accidents), were included among the main causes of mortality and began to have a major impact on the burden of diseases of Brazil in projections for the coming decades. Communicable diseases, in turn, continue to be important for global and national strategies, including their association with chronic diseases (such as in cervical cancer transmitted by HPV).

Regarding the demographic profile, according to the National Household Sample Survey, by the Brazilian Institute of Geography and Statistics, there were about 26.3 million people aged 60 years or older in Brazil, equivalent to 13% of the population. By 2050, the IBGE forecast is that this number will reach 66.4 million people, who will represent 29% of the population (IBGE, 2013).

This epidemiological and demographic context complicates and stresses the possibilities of universal, equitable, and integral access, in short-, medium-, and long-term perspectives. There will be a growing demand on promotion, prevention, and healthcare, considering that the country is far from having a 19th-century profile concentrated in tropical diseases, with a quickly aging population and longer life expectancy, conditions mainly derived of the gains of social inclusion observed in the past few decades.

In the macroeconomic dimension, austerity policies generate a vicious cycle of crisis, deepening the difficulties of public financing, generating more crisis and greater problems for the state, and bringing harmful and ineffective consequences, as shown by Keynesian critics (Stiglitz, 2010). In Brazil, targets have been set that freeze nonfinancial expenditures by the government for the next 20 years. These affect mainly health and education, due to their high impact, and these targets will not be sustainable by cutting other significantly lower expenditures.

In the dimension of innovation and access, there is a great international debate regarding the affordability of rising health expenditures. It arises from an economic, corporate, and institutional model in which the large public and private expenditures involved in the processes (health accounts for about 30% of global spending on research and innovation) must be balanced by the few successful innovation efforts. In addition, a crucial aspect is that health markets are highly oligopolized, especially in the most innovative products, with a high rate of return and profitability in relation to other sectors of economic activity.

There is, therefore, an interdependence between the social, economic, and innovation dimensions linked to the field of public health. Theoretically, these dimensions have been approached in a fragmented and isolated manner both in the economic literature as well as in the public health approaches, considering them as antithetical poles. A positivist and Cartesian rationality prevails, distant from systemic and dialectical perspectives.

The concept of the health economic-industrial complex (HEIC), discussed in the next section, emerges precisely from the search for a dialectical integration between those dimensions that, in real life, are interdependent. Health is, at the same time, a right related to citizenship and a decisive front for development that conditions the model of society at the national, regional, and global level. The productive and innovative capacity can be an expansion vector for rendering universal access viable or may constitute, as the current trend reveals, a trajectory for the generation of asymmetries between people, regions, and countries (Gadelha et al., 2018).

HEIC: Concept and Morphology

The HEIC concept, developed in the early 2000s (Gadelha, 2003; Gadelha, Costa, Maldonado, Barbosa, & Vargas, 2013), allows us to capture these systemic relations between access and the productive and technological base in health, characterizing a locus, both social and economic, from which emerges an interdependent dynamic. In this socio-economic-institutional space, health goods and services, productive sectors, government institutions and policies, science and technology organizations, and the regulatory institutional base all influence one another, defining HEIC trajectories that condition the likelihoods of universal access.

The concept of the HEIC indicates the existence of a productive system that constitutes the material base in which the actions of promotion, prevention, attention, and care in health occur. It encompasses technologies and innovations in goods and services and intangibles (such as knowledge embodied in medical practices), as well as the organizational and institutional forms that permeate health actions (the organization of the health system and primary care, for example). The HEIC concept, thus, defines a production space that involves the relationship of the productive and business base with the institutional organization and society in the health area.

Relations of production, investment, the generation of employment and income, and the introduction of innovations occur in this health productive environment. They also cover the circulation of goods and services between producers and citizens, involving both the mercantile relations with the consumers and the nonmarket relations with the health units in which the population’s access occurs. Finally, it also involves financial relations within the specific productive chains and segments and between the different agents and institutions.

It is this simultaneous and endogenous articulation between the spheres of production, circulation, and financial capital in the health area, even when provision and financing are public as in universal systems, that allows identification of an integrated “economic” sphere pervasive throughout production and access to health.2 The “industrial” designation, in turn, refers to the fact that, in contemporary society, the production of goods and services generally follows the industrial logic of scale production for exchange, as explained by the classical economists who first studied the nature of capitalism (Marx, 1867/1996; Smith, 1776/1983). The industrial logic, rigid or flexible, tangible or intangible, permeates all health production, be it goods, services, or systems and information/communication devices.

In summary, the concept of HEIC incorporates a particular social and institutional sphere (“health”), the economic and industrial environment from which this productive health system emerges (“economic-industrial”), and the existence of an interdependent and open system (“complex”), conditioning the structural possibilities for sustainable universal access.

The vaccine area, a striking segment of this theoretical and political point of view, was studied from a public health perspective, in which the strategies of universal vaccination of the population within the scope of the National Immunization Program (Programa Nacional de Imunização) were very dependent on the existence of a productive and technological base in Brazil. Only when local production was articulated with the structuring of health services and actions was it possible to meet the demand of the population in a universal way, reducing the global asymmetries that brought limitation in access, especially in those vaccines that use modern biotechnologies (Temporão, 2003a, 2003b).

It should be noted that there is an important antecedent of this view, presented in the contribution by Cordeiro (1980) in the field of public health, which identified the existence of a medical-industrial complex that conditioned consumption in health. His analysis explicitly emphasized the sphere of products’ circulation, particularly showing how drug consumption followed a mercantile logic that influenced medical practices, establishing a dichotomy between the fields of public health and economic development (Gadelha & Temporão, 2018).

The conception of HEIC incorporates and surpasses this perception in a dialectic way, seeking to understand health as a space of citizenship, rights, and equity and as a structural space for innovation, investment, income generation, and employment in contemporary society. In this direction, health is understood, dialectically, as a space for development, not just exchange, encompassing the productive and innovation structure, the exchange relations, and the financial dimension. It is the convergence of these dimensions around the productive system of health that defines the possibility of performing virtuous trajectories that stimulate the production and the access or vicious trajectories in which the exchange relations and the financial dimension can imply restrictions both for the productive evolution and for universal access.

As a theoretical basis, three major theoretical paradigms were part of the conceptual construction that allowed Brazil to overcome the neoclassical health economics frameworks—statically focused on the allocation of scarce resources, thus favoring exchange and consumption—for a vision of the political economy of health development (Gadelha & Temporão, 2018).

First, HEIC emphasizes health as a space for productive and innovation development, incorporating the theoretical frameworks of Schumpeter (1942/1984) and Marx (1867/1996) on the capitalist dynamics that, at the same time, continuously creates new economic and socio-institutional spaces, as well as generates risk of untying between production and needs and equity in health.

Second, HEIC is based on a Keynesian perspective in which investment and the generation of employment and income are privileged, not the states of equilibrium and resource allocation within the scope of exchange relations. As a result of including the Keynesian view, the state is incorporated as an essential instance of demand creation to stimulate investment and to build a social welfare space that does not naturally arise from market forces (Keynes, 1926/1978, 1936).

Third, HEIC incorporates the Latin American tradition associated with structuralist theories of development (Furtado, 1961, 1964; Prebisch, 1949). It emphasizes the importance of the structure and productive capacity, notably the most intensive in knowledge and technology that are present in the industry, according to the traditional structuralist approach, but that permeate the whole productive system, including service activities. The different capacities among agents and institutions generate strong asymmetries both inside the countries (modern and backward sectors) and in the international division of labor (Gadelha et al., 2018). There is no natural process of linear stages of development, as revealed by Gerschenkron (1962) long ago.

In an integrated theoretical view, therefore, the HEIC approach shows the central role of innovations, the focus on the expansion and transformation of the productive system in health (and not only on allocation and exchange), and the centrality of the local and global productive structure for economic sustainability in health. The crucial role of the state is seen as an integral part of the concept, especially in actions to regulate and promote health development by use of the public purchasing power, the stimulation of investments, and the assurance of universal access. It is assumed that the concept simultaneously has a political and normative vision, permeated by values (development and universal access), which allows situation of it in the tradition of public health thought and which, specifically in Brazil, historically sought to establish a link between health and development (Gadelha & Temporão, 2018; World Health Organization, 2008).

As shown in Figure 1, the HEIC morphology is composed of

  1. A. Chemical and biotechnology-based industries, with the leadership of the pharmaceutical industry, encompassing medicines, active pharmaceutical ingredients, vaccines, blood products, and reagents for diagnosis.

  2. B. Mechanical, electronic, and materials-based industries, involving the medical equipment segments, orthoses, prostheses, medical materials, and diagnostic devices.

  3. C. Health services (medical and health professional practices in general) in which research, innovation, and new products become effective as access in an intricate knowledge network that follows a path that runs, with strong feedback mechanisms, from basic research to services. The latter, in turn, feeds clinical, preclinical, and translational research as a field of practice in which the innovation turns into access.

The Health Economic-Industrial Complex (HEIC) and a New Public Health PerspectiveClick to view larger

Figure 1. Health Economic Industrial Complex—Morphology. Reprinted from Gadelha (2003).

This conception provides a key to coping with the political and economic tension between innovation and access. Under it, health is seen, simultaneously and endogenously, both as a space for access and guarantee of social rights and as an investment, income, employment, and innovation front of the most powerful in contemporary society. In Brazil, health mobilizes 9% of the gross domestic product, 6.6 million skilled workers (considering indirect employment it involves around 20 million workers), and 35% of research and development efforts, and it is a technological platform for the critical innovations for the fourth technological revolution, involving the development and use of big data, information technology, large-scale connectivity, and bio- and nanotechnology, among others (Gadelha & Temporão, 2018; IBGE, 2017). Following this perception, health can clearly be understood as investment for the future and not just as current expenses that are lost in the act of consumption. This understanding may constitute a paradigm break for common sense by placing attendance to social need as an expansion front for the future that generates income and fiscal resources for the state, with innovation being the key factor of development as shown by the contemporary literature on development.

Certainly, this understanding also poses challenges for the productive sector to widen its focus to place universal access at the heart of its strategy, offering affordable technologies essential for the sustainability of the health system. From the point of view of public power, it places a new agenda of social spending not as a burden but as an opportunity in the context of a national development strategy.

In Brazil, this perspective for health was explicitly adopted in 2008 in the national development policy, with the creation of the Executive Group for HEIC in the Productive Development Policy to articulate the various areas of public intervention (Presidência da República, 2008) and in the strategic plan for the Ministry of Health of Brazil (MOH), More Health Program (Programa Mais Saúde) (Ministério da Saúde, 2008).

HEIC has become part of the industrial policy’s and the national production system’s core, placing it at the top priority in the context of systems capable of promoting a dynamic insertion of the country into the global economy, without losing sight of a solidary perspective in international cooperation. Creation of a ministry of the social area to be responsible for coordinating an industrial and development policy was a remarkable accomplishment, considering the international public policy experience. The MOH coordinated strategies and actions involving 14 ministries and government agencies, articulating the use of state purchasing power, investment financing, health, and intellectual property regulation.

Under the HEIC strategy, an action was structured through the establishment of Productive Development Partnerships (PDP), which involved technology transfer models from private companies to public institutions that produced, on a shared basis, medicines, vaccines, and medical products for the Unified Health System (SUS; Gadelha & Braga, 2016). By 2014, 106 PDPs had been established, involving 75 acquisitions by MOH and technology transfer agreements to meet the needs of the SUS, including major international companies that are leaders in health innovations (Gadelha & Temporão, 2018). PDP products in general are of a higher technological content and require the internalization of the technological core in the country, aiming at reducing SUS vulnerability and increasing the possibility of global technological cooperation.

This innovative and cooperative model was preceded by the National AIDS Program experience, which, in the late 1980s, faced problems ensuring the population’s access to innovative and costly drugs. With the impossibility at the time of an agreement that would involve an increase of scale and lower prices, the Brazilian government decided to issue compulsory licensing for Efavirenz (Presidência da República, 2007; Rodrigues & Soler, 2009). Access to AIDS treatment was guaranteed through local production in a partnership model that provided one initial basis for implementing the HEIC conception with PDPs, which proved an instrument of great importance and impact. This decision, in fact, spread a signal to the national and international productive sector, communicating that these strategies of cooperation were able to articulate the interests involved in the HEIC around the universal access in a win-win game.

This perception increased in strength until 2015 and, from then on, grew into an indefinite situation in the face of crisis and restrictive policies of austerity.3

Barriers for Universal Access Related to National and Global Strategy to HEIC

This systemic approach to HEIC is crucial to understand the sustainability of health systems that aim to guarantee universal access. First, as mentioned at the beginning of this article, chronic diseases (e.g., cancer, pain, and autoimmune, circulatory, and mental disorders) constitute one of the most challenging fronts of innovation for treatment, and they are central to the national epidemiological context of Developing Countries (DC).4 There is no more a place where the main health problem is related basically to tropical disease in a global health perspective.

Second, to link its use with access, it is imperative to adopt a systemic approach that involves fast and accurate diagnosis, the production of technology frontier products, and a network of promotion, prevention, diagnosis, and treatment services that respond to the concrete requirements of access and citizen care and that go far beyond the availability of products.

Third, the issue of affordability is critical in the class of products that involves new technologies, and it is impossible to think of mass public health with the prices practiced, which would exclude practically the entire Brazilian and DC population from its use. It becomes unfeasible for a universal public system and for the great majority of people who would not have any possibility of paying privately for these expenses, reinforcing an asymmetric world in terms of market power of a few number of oligopoly firms. The issue of innovation and access is crucial to the evolution of health technology in DC as well as in Brazil in a more comprehensive and politically justifiable way.

The Brazilian pharmaceutical market is the sixth largest in the world (turnover in excess of US$20 billion) and has been one of the few that are still growing in the crisis, but the limits for the incorporation of technologies of very high costs already give clear signs of being reached. Table 1 shows the growing share of high technology products. Cancer products—the most prominent therapeutic class in terms of knowledge, prices, and market interest—in the Brazilian pharmaceutical market increased from a share of 8% in 2004 to 14.3% in 2014, representing a 79% increase in an expanding market (Brazilian Health Regulatory Agency [ANVISA], 2017). Obviously, this growth has limits on other legitimate demands for other classes of drugs in a universal health system.

Table 1. Pharmaceutical Market: Therapeutic Classes Participation: Brazil

Year

Therapeutic Class

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

A: Digestive System and Metabolism

13.60%

12.70%

12.00%

12.60%

12.90%

11.80%

11.30%

11.80%

12.50%

12.60%

12.70%

B: Blood and Blood-Formatting Organs

2.80%

3.10%

2.70%

2.70%

2.50%

2.40%

2.30%

2.50%

3.20%

2.80%

3.40%

C: Cardiovascular System

10.50%

11.20%

10.60%

11.60%

11.80%

12.70%

11.70%

10.80%

10.40%

9.80%

9.70%

D: Dermatology

5.10%

4.90%

4.50%

4.50%

4.30%

4.30%

4.40%

4.60%

4.10%

4.00%

3.80%

G: Genitourinary System and Sexual Hormones

8.50%

8.50%

7.70%

7.50%

7.20%

7.00%

7.10%

7.70%

7.70%

7.10%

6.80%

H: Hormone Preparations

3.00%

2.70%

2.50%

2.50%

2.60%

2.50%

2.40%

2.60%

3.00%

3.20%

2.90%

J: Antiinfecciosos in General

11.40%

10.70%

9.80%

9.70%

9.30%

9.50%

10.10%

8.60%

10.00%

9.40%

12.00%

K: Hospital Solutions

1.40%

1.90%

2.00%

2.30%

2.30%

3.60%

3.60%

2.90%

2.40%

2.80%

2.80%

L–: Antineoplastic and Immunomodulatory Agents

8.00%

9.10%

13.90%

10.70%

11.80%

12.20%

13.50%

14.60%

14.00%

14.60%

14.30%

M: Musculoskeletal System

7.30%

7.50%

7.00%

7.60%

7.30%

6.90%

6.70%

6.70%

7.80%

7.60%

7.20%

N: Central Nervous System

14.60%

14.80%

13.90%

14.80%

14.60%

14.40%

14.90%

15.50%

14.00%

14.90%

14.30%

P: Parasitology

0.90%

0.90%

0.90%

0.80%

0.70%

0.70%

0.60%

0.60%

0.50%

0.50%

0.50%

R: Respiratory Tract

7.90%

7.00%

7.00%

7.20%

7.10%

7.10%

6.70%

7.10%

6.80%

7.10%

6.20%

S: Sensory Organs

2.00%

2.10%

2.10%

2.30%

2.30%

2.30%

2.30%

2.60%

2.40%

2.40%

2.20%

T: Diagnostic Agents

0.50%

0.50%

0.60%

0.70%

0.70%

0.70%

0.90%

0.80%

0.60%

0.60%

0.60%

V: Miscellaneous

2.30%

2.30%

2.80%

2.60%

2.50%

1.90%

1.40%

0.70%

0.50%

0.70%

0.60%

Source. Brazilian Health Regulatory Agency (ANVISA), 2017, database: Drug Market Regulation Chamber (CMED)/ANVISA.

Within the restricted scope of federal public spending, evolution and its limits also appear very clearly. Table 2 shows that public spending on cancer treatment has increased over four times since the late 1990s, with spending on chemotherapy products accounting for its largest component, standing at over 60% of total expenditure in 2017.

Lastly, and portraying the difficulties of access, taking oncology as an example, compliance with Law 12.732 of 2012, which defines a maximum waiting time for starting treatment after a positive cancer diagnosis of 60 days, can only be met in little more than 50% of cases, and in the less developed regions of the North and Northeast even below half of the population diagnosed (Figure 2).

Table 2. Federal Expenditures on Oncology (1999, 2009, 2017) (in US$ Million)

1999

2009

2017

Surgical Oncology(*)

47.96

86,54

285.21

Radiotherapy

42.44

81,99

136.75

Chemotherapy

168.69

615.19

750.13

Iodine Therapy

0.026

2.08

1.39

Total

259.38

801.29

1,173.49

Notes: (*) Only surgical high complexity surgical procedures (in 2017, with sequentials). Some years do not include orthopedics, neurosurgery, or ophthalmology as well as oncologic intercurrences, continuous chemotherapy hospitalization, etc., without severe impact in the analysis outcome.

Total spending in oncology as of 2017: US$1,485,557.97. Values based on average exchange rate of each year.

Source. Unified Health System Database, Ministry of Health of Brazil. Reprinted from Gadelha (2019).

The Health Economic-Industrial Complex (HEIC) and a New Public Health PerspectiveClick to view larger

Figure 2. Oncology Treatment Compliance With Law 12.732/2012 (treatment in 60 days).

Source: Ministry of Health of Brazil (2016). Cancer Information System of the Unified Health System Database.

There are thus visible access problems in high technological products determined both by the health financing conditions and by the high prices of products that limit the incorporation or that keep the system from being able to offer the treatment in the appropriate period. In this context, the incorporation of technology in Brazil will be clearly limited, even for those products whose incorporation is rational and cost-effective, possibly generating loss of credibility and legitimacy of health policies and productive sectors among society.

The HEIC perspective, following the aforementioned theoretical framework related to the asymmetries generation process, relies heavily on the trade balance in health as a strong indicator of global asymmetry and dependence, showing opportunities and structural bottlenecks for its development. The evolution of the trade balance in health reveals the endogenous relationship between the dynamism and the technological qualification of HEIC and the structural dependence on health as a limiting factor of universal access (Gadelha et al, 2018).

Considering the economic point of view, the Brazilian trade deficit has shown explosive growth in the health area. As shown in Figure 3, the real trade deficit in dollars (2015 prices) rose from US$3.5 billion to US$12 billion, falling in the most recent period as a consequence of crisis. In a more disaggregated analysis of this data, 74% of imports are concentrated in the pharmaceutical area (26% in equipment and materials), and the fastest growing segment is biotechnology. This situation shows the risk for access due to the excessive technological and productive dependence on imports, which was the main factor behind the development policy for HEIC adopted since 2008 (Figure 4).

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Figure 3. Evolution of the Brazilian trade balance in health: Overview, 1996–2017. (US$ billions, 2017 prices, USA). Reprinted from Gadelha and Temporão (2018).

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Figure 4. HEIC 2017—Participation of industry segments in the health trade balance deficit of Brazil.

Source: Prepared by authors on the methodology basis developed by the Coordination of Prospecting Actions of the Presidency/GIS/FIOCRUZ, from data of the Ministry of Industry, Foreign Trade and Services of Brazil database.

In an international comparison, it is evident that it is not only a deficit of products that depends on the existence of different prices in the countries and economic blocs. The countries and regions with which Brazil has a deficit are those in the process of accelerated innovation in health, especially Europe, the United States, and, since the 2000s, China (Figure 5). The nature of the deficit is structural, reflecting the presence of strong global asymmetries, which make peripheral health systems vulnerable and dependent on exogenous economic conditions.

Business relationships are desirable and frequent in a globalized world. However, when they reflect divergent patterns of expertise in which some countries specialize in products dense in technology and knowledge while other countries focus on the production of raw materials and natural resources with low added value, the deficit reveals a perverse situation. A few countries have a capacity for allowing health to generate development and meet their local needs, while in DCs, the domestic demand for health generates wealth only in the richest countries, and their health systems are vulnerable and dependent on an exogenously generated scientific and technological standard, unattached to their demands. The global technological asymmetry revels itself in the face of the differentiated dynamics of HEIC.

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Figure 5. HEIC 2017—Participation in the HEIC deficit by commercial partner.

Source: Prepared by authors on the methodology basis developed by the Coordination of Prospecting Actions of the Presidency/GIS/FIOCRUZ, from data of the Ministry of Industry, Foreign Trade and Services of Brazil database.

More broadly, the policies for strengthening HEIC and its orientation toward achieving universal access require that Brazilian society legitimate health and innovation as strategic areas of development. This involves addressing challenges and overcoming barriers such as (a) the limitation of public funding, insufficient to provide universal access and to generate a stable demand for products and services; (b) political-institutional regulatory instability, which restricts long-term investment programs under HEIC, such as productive development policies; and (c) the restriction of investments in science, technology, and innovation in health and its transformation into wealth for society, which involves limits related to financing, the insertion of the productive sector into innovation activities, and a regulatory framework that does not generate risks and uncertainties in the articulations between the state, science and technology institutions, and the productive sector.

Opportunities and Recommendations: In Search of a Virtuous Circle Between Innovation Incentives and Universal Access

In the context presented, the prices of the most promising innovative products end up being unsustainable in terms of universal access viability (United Nations, 2016), and the most dynamic innovative areas end up posing striking dilemmas. In Brazil, in 2012, the National Commission for Technological Incorporation (CONITEC) was institutionalized by a Law and Presidential Decree to enable the incorporation of new technologies, seeking to ally sanitary and economic rationality with access to products that effectively make a difference. According to a survey carried out with by Commission, the area of chronic diseases that require new biological products saw the most health technologies incorporated at least since 2010.

However, it is understood that the incorporation of technologies necessarily goes through a systemic view of access to health (Chalkidou et al., 2014), since, in the process cycle linking research to health, it is essential to include the local production and innovation basis, along with the organization of health systems, under an universal perspective. Without endogenous knowledge and innovation, it is impossible for a DC to evaluate and support the introduction of new products and processes in its universal health systems. Knowledge, in the current context of technological dynamics, is essential to consider local specificities and necessities. Deprived of it, countries become dependent on exogenous variables and detached from their effective needs. This is not an argument in defense of a closed innovative process but rather a recognition of the fact that a local knowledge basis oriented toward universal access is vital, even to breed more symmetric technological international cooperation under a global health perspective.

In Brazil, 75% of the population depends exclusively on the SUS, while the private segment accounts for 25% of the care, and, in chronic diseases and higher costs such as cancer, the importance of the public system is even greater. There is clearly an interdependence between the two systems in terms of technological incorporation (the Supplementary Health Agency, which regulates private plans and has a seat in CONITEC), and the flow of people, institutions, and resources between the public and private spheres is poorly regulated and inefficient.

Despite all the structural and conjunctural barriers and limits indicated, Brazil has opportunities for the development of new technologies in critical areas. Favorable structural characteristics are especially evident in the health sector, since the country has: a universal health system defined in its constitution, a large internal market, an industrial productive base with public and private companies and institutions, and a significant scientific base in health and in biological sciences which are among the most improved in the past 15 years in Brazil. As a result of this perspective, Brazil has adopted a strategy that began to consider health as a strategic area of development.

Faced with these challenges and opportunities, the following recommendations are suggested as a basis for developing a strategy for the development of the HEIC, innovation, and universal access:

  1. 1. Articulation of state and productive sectors to change institutional and business models and switch from the restricted market niche strategies for a few with a high cost to a strategy of service in scale at lower prices to enable universal access to a wide range of new products that meet the requirements of health technology assessment. In this new model, there would be mutual commitments to enable access on a larger scale and at lower prices.

  2. 2. Increase of business competition in the area, reducing extreme situations of monopoly and oligopoly and reducing technological asymmetries between companies and between countries and regions. Competitive pressure, stimuli to the creation of technology-based companies to meet the demands of universal systems—taking the Brazilian experience in the context of SUS—and the strengthening of local institutions and enterprises are important elements in enabling the expansion of access and the adoption of innovation strategies.

  3. 3. Strengthening of partnerships for productive development in strategic technologies for the people—involving public science, technology, and innovation institutions and public and private producers, adopted within the framework of the HEIC policy. It is the only way to reduce research and development costs and eliminate large marketing expenditures, characteristic of the HEIC segments, due to the commitment to buy long-term effective products through transparent mechanisms and protected from the risks of state capture by private interests.

  4. 4. Maintenance in national, regional, and global forums and with stakeholders that health is a highly dynamic productive system and that public spending generates investment, employment, income, innovation, and public revenues that contribute to economic and social development.

  5. 5. Articulation of public policy instruments linked to the regulation of the productive sector, technological incorporation, financing, and the public market based on the fulfillment of social needs and the effective contribution of innovations to health. This must enable innovation and access in a virtuous circle, without which society will come to perceive technology as a splitting element rather than mutually shared gains.

In a more conceptual perspective, the understanding of the articulation between the economic and social dimension of the innovation faces limitations of the theoretical and empirical field. The HEIC approach requires the consolidation of a field of research for conceptual and methodological deepening, with depends on topics such as

  • The social impact of innovation indicators;

  • The relationship between technological development and health system organization and access;

  • The association between strengthening HEIC and sustainable development;

  • The link between the industrial and services segments in health;

  • The influence of the financial logic and the global dominance of macroeconomic adjustment on the development of the social welfare systems and on health equity; and

  • The state strategies for establishing a relationship with the productive sectors that stimulate a technological pattern that allows the sustainability of the universal health system.

In conclusion, the late and slow construction of a social welfare state in Brazil highlights the need to act on a particularly fragile link in DCs: the HEIC. An economically and socially developed country requires a strong productive base aimed at meeting the demands arising from the strategies of social inclusion and the alleviation of inequalities. Without this, any social welfare project will face the blockages arising from a consolidated structure, functional only for a heavily unequal country and with concentrated consumption at the top of the social pyramid. Needless to say, the spirit of thinkers such as Celso Furtado, in the sphere of economics, and Sérgio Arouca,5 in the field of health, are once again prowling around new ideas based on their old convictions. Innovation for universal access to health—this is the synthesis of the concept of HEIC and of this new perspective for public health and for standards of development committed to the quality of life of people and society.

Acknowledgments

We wish to thank Marco Aurelio de Carvalho Nascimento, Patrícia Seixas da Costa Braga, and Bernardo Bahia Cesário, researchers from the Office for the Coordination of Prospecting Actions and the Research Group on Development, Economic-Industrial Complex and Innovation in Health for their support in the collection and systematization of information and the subsidies for the analysis developed.

Further Reading

Albuquerque, E., & Cassiolato, E. (2000). As especificidades do sistema de inovação do setor saúde: uma resenha da literatura como uma introdução a uma discussão do caso brasileiro (1st ed., Vol. 1). São Paulo, Brazil: Federação de Sociedades de Biologia Experimental.Find this resource:

Arouca, S. (1992). A hipercrise sanitária. Indicadores Econômicos FEE, 19(4), 167–174.Find this resource:

Arouca, A. S. da S. (1975). O dilema preventivista: contribuição para a compreensão e crítica da medicina preventiva (Doctoral dissertation). Universidade Estadual de Campinas, Campinas, Brazil.

Buss, P. M., & Tobar, S. (Eds.). (2017). Diplomacia em Saúde e Saúde Global: Perspectivas latino-americanas. Rio de Janeiro, Brazil: Editora FIOCRUZ.Find this resource:

Furtado, C. (1977). Economic development of Latin America: Historical background and contemporary problems (2nd ed.). (S. Macedo, Trans.) Cambridge, U.K: Cambridge University Press.

Hidalgo, C. A., & Hausmann, R. (2009). The building blocks of economic complexity. Proceedings of the National Academy of Sciences, 106(26), 10570–10575.Find this resource:

Mazzucato, M. (2018). Mission-oriented innovation policies: Challenges and opportunities. Industrial and Corporate Change, 27(5), 803–815.Find this resource:

Silva, G. de O., & Elias, F. T. S. (2018). Parcerias para o desenvolvimento produtivo: um estudo de avaliabilidade. Comunicação em Ciências da Saúde, 28(2).Find this resource:

Vargas, M. A., Almeida, A. C. S., & Guimarães, A. L. C. (2016, December). Parcerias para o desenvolvimento produtivo (PDPs/MS): Contexto atual, impactos no sistema de saúde e perspectivas para a política industrial e tecnológica na Área da Saúde. Texto para discussão. Rio de Janeiro, Brazil: Saúde Amanhã/Fundação Oswaldo Cruz.Find this resource:

Viana, A. L. D., & Elias, P. E. M. (2007). Saúde e desenvolvimento. Ciência & Saúde Coletiva, 12(3), 1765–1778.Find this resource:

World Health Organization. (2001). Macroeconomics and health: Investing in health for economic development. Report of the Commission on Macroeconomics and Health. Geneva, Switzerland: Author.Find this resource:

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Notes:

(1.) For a comprehensive overview of universal access, see the articles published by The Lancet: (2012) Universal Health Coverage: Themed Issue and to understand health policies and healthcare systems in Latin America see Laurell and Giovanella (2018).

(2.) The definition of public good does not depend only on the technical characteristics of the products (nonrival goods and nonexclusive use). It is fundamentally a political decision of society that defines what should be guaranteed to all and what must depend on the individual capacity to pay (Nelson & Winter, 1982). The definition of health as a public good and of the right to universal access therefore depends on a political choice of society even if production has the participation of the private sector.

(3.) The HEIC concept has given rise to a research program that involves many researchers from different institutions in Brazil, including the deepening of the themes of the dynamics of industrial innovation, the relationship with universal access, a critical view of technology, the financial dimension of the accumulation of capital, and the relationship between service and industry, among other issues that emerge from this scientific paradigm. See, for example, the Reports in Public Health (2016) and Costa, Bahia, and Gadelha (2015).

(4.) Morel et al. (2005) make a relevant distinction regarding the less developed countries highlighting a subgroup formed by Innovative Developing Countries (Morel et al., 2005). Considering the global crisis and the deepening inequalities between regions and countries, except for China, we maintain the Developing Countries terminology but recognize this important distinction between countries with a promising scientific and technological base, such as Brazil, and those in which the initial conditions are more perverse (Gerschenkron, 1962).

(5.) These authors are, respectively, the most important Brazilian structuralist development economist and the main health reform proponent and thinker of the Brazilian Universal System.