The Role of Market Interventions to Increase Access of Health Commodity in LMIC: A case of the IPAQT

By Parshuram Hotkar, Sarang Deo

Citation

Hotkar, Parshuram., Deo, Sarang. (2025). The Role of Market Interventions to Increase Access of Health Commodity in LMIC: A case of the IPAQT .

2025

Abstract

Low and medium income countries (LMICs) face challenges to provide access to health commodities. This paper explores the use of market interventions that coordinate pricing in a supply chain to improve access to diagnostic tests for tuberculosis (TB) in the LMICs. Specifically, we analyze the role of the Initiative for Promoting Affordable and Quality TB Tests (IPAQT) in India, which aimed to lower the cost of the Xpert MTB/Rif assay through negotiations with manufacturers and coordination with private labs. Using a game-theoretic model, we assess the feasibility and sustainability of market-transforming interventions and their impact on test consumption. We identify the conditions under which such interventions successfully coordinate the transformation from a high-price, low-volume market to a low-price, high-volume market. Additionally, we demonstrate that internal price control mechanisms like IPAQT lead to higher consumption compared to external mechanisms such as price regulations, particularly in the presence of heterogeneity in private labs. This research contributes to our understanding of the economics of market-transforming interventions, their generalizability, and provides guidelines for policy makers and donors for intervention designs aimed at enhancing access to health commodities in the LMICs.

Parshuram Hotkar is an Assistant Professor of Operations Management at the Indian School of Business (ISB). His primary area of interest is studying strategic interactions in competing supply chains with applications in omnichannel retailing and the pharmaceutical industry. He studies drug shortages due to frequent supply disruptions in the injectable drug supply chain. He has also collaborated with an advertising company for his work on social media platforms.

Professor Hotkar has received research awards from several renowned organisations, including INFORMS and the Decision Sciences Institute (DSI).

His teaching interests include supply chain optimisation, supply chain modelling, strategic procurement, operations management, and social media analytics.

Prior to joining ISB, he earned his PhD and MS in Information, Risk, and Operations Management from the McCombs School of Business at the University of Texas at Austin. He also holds an MS in Operations Management and dual degree (BTech and MTech) in Biotechnology from IIT Madras.

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Parshuram Hotkar

Sarang Deo is a Professor of Operations Management at the Indian School of Business (ISB), where he also serves as the Deputy Dean for Faculty and Research and as the Executive Director of the Max Institute of Healthcare Management (MIHM).

His primary area of research is health care delivery systems. He is interested in investigating the impact of operations decisions on population-level health outcomes. Some of the healthcare contexts that he has studied include the influenza vaccine supply chain and the phenomenon of ambulance diversion in the US, HIV early infant diagnosis networks in sub-Saharan Africa, and formal and informal pathways for tuberculosis (TB) diagnosis in India. He regularly collaborates with international public health funding and implementation agencies such as Bill & Melinda Gates Foundation (BMGF), Clinton Health Access Initiative (CHAI), and PATH for his research. He currently serves as a member of the WHO Strategic and Technical Advisory Group on TB (STAG-TB).

Prior to joining ISB, Professor Deo was an Assistant Professor at the Kellogg School of Management. He holds a PhD from UCLA Anderson School of Management, an MBA from Indian Institute of Management (IIM) Ahmedabad, and a B Tech from the Indian Institute of Technology (IIT) Bombay. Before entering academia, he worked with Accenture as a management consultant.

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Sarang Deo