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A Continuing Global Epidemic
It is now quarter of a century since the first cases of AIDS were
The AIDS epidemic is continuing to grow and there is evidence
detected. In the intervening period, AIDS has killed more than 25
that some countries are seeing a resurgence in new HIV infection
million people, orphaned millions of children and slowed economic
rates which were previously stable or declining. In 2006, around 40
development, even reversing it in some cases. Around 40 million
million people globally were estimated to be HIV positive and 2.9
people now live with HIV. The epidemic is growing in many parts of
million died of AIDS (2.8 million died in 2005). :
the world, but is worst in sub-Saharan Africa. Our study has looked atthe extent of the problem, its relevance to business and the various
• Sub-Saharan Africa remains the worst affected region with South
responses to it. It culminates in the examples of three major UK
Africa’s epidemic showing no evidence of a decline. In 2006,
companies and their approach to managing their exposures to the
around 20% of working-age adults in South Africa had HIV.
disease in sub-Saharan Africa. These studies will serve as useful
Approximately 25 million people in sub-Saharan Africa are HIV
reference for comparison of the approaches taken by multinationals
positive - almost 63% of global cases.
operating in similarly affected areas, be that sub-Saharan Africa orother low-income, high disease-rate regions.
• In the Middle East and North Africa, recorded HIV infection rates
are very low, not exceeding 0.1%. However, available data
suggests that the epidemics are growing in several countries
In 2001, at a session of the UN General Assembly, leaders from 189
including Algeria, Iran, Libya and Morocco.
Member States committed to targets for delivering effective HIVprevention, treatment, care and support. The aim is to start a reversal
• In Asia, around 8 million people are HIV positive and recent
of the global epidemic by 2015. This Declaration of Commitment on
increases in infection rates are particularly evident in Indonesia,
HIV/AIDS requires members to report regularly to the General
Papua New Guinea, Vietnam, China, Bangladesh and Pakistan.
Assembly on progress, using indicators developed by The Joint United
However, nearly two-thirds of all HIV cases in Asia are in India,
Nations Programme on HIV/AIDS (UNAIDS).
due to the sheer size of the population rather than a highprevalence rate. Both India and China have the potential for
The UNAIDS programme brings together the resources of ten UN
major epidemics, driven in part by their growing mobility.
system organisations. Co-sponsors include UNICEF, InternationalLabour Organisation, World Health Organisation and the World Bank.
• The Caribbean region remains the second most affected region in
As the directing and coordinating authority on international health
the world. National adult HIV prevalence exceeds 2% in Trinidad
work, the World Health Organisation (WHO) takes the lead in the UN
and Tobago and 3% in Haiti and the Bahamas.
system on the global health sector response to AIDS.
• In Latin America, 1.6 million people are living with HIV, one-third
Overall, leadership and political action on AIDS have increased
of whom live in Brazil (the region’s largest country). However,
significantly since 2001. Around 90% of reporting countries now have
the most intense epidemics are in Belize and Honduras, both
national AIDS strategies and 85% have a national body to coordinate
with 1.5% of the population HIV positive.
AIDS efforts, while 50% have evaluation/monitoring frameworks.1
• In Eastern Europe, there are indications that infection rates have
However, prevention programmes still reach only a small minority of
increased sharply since 2004. The Russian Federation has the
those in need. According to UNAIDS, in low and middle income
largest epidemic in Europe, with estimates suggesting that 1% of
countries HIV prevention programmes are failing to reach many of
the population have contracted the disease.
those at greatest risk. Surveys indicate that fewer than 50% of youngpeople have comprehensive knowledge levels on HIV. Only about 10%
• Even in North America and Western Europe things have stalled,
of homosexual men and fewer than 20% of injecting drug users
with the number of new infections not improving in the last two
received any type of HIV prevention services in 2006. Between 2001
years, particularly among homosexual men, suggesting that HIV
and 2006, the number of people on anti-retroviral therapy in low and
middle income countries increased from 240,000 to almost 1.5million. Globally, however, anti-retroviral drugs still reach only one in
Overall, 4.3 million new infections occurred in 2006; approximately
five who need them. Ongoing obstacles to expanding treatment
include the concentration of treatment sites in urban areas (ie. lack ofprovision to dispersed populations) and inadequate efforts to address
The UNAIDS Executive Director, Dr Piot, summed up the above
vulnerable populations such as sex workers, homosexuals, drug
figures saying “It appears that countries are not moving at the
addicts, prisoners and refugees. Another barrier is the number of HIV
positive individuals who are unaware that they are infected, as they donot request testing. Testing must be voluntary and this is a majorweakness in the global fight against AIDS. However, the alternative inmany countries could be systemic discrimination. In China, forexample, the lack of guaranteed confidentiality is a potential problem.
Company Response Examples
The company has 121,000 employees in Southern Africa and they
Short-term trends in absenteeism
estimate the prevalence of the disease in the workforce is 23%(28,000 employees). Voluntary HIV testing and counselling is
offered, and in 2006, 63% of their workforce took this up. Around
8,500 (30%) of their HIV positive employees have enrolled in disease
management programmes of which some 4,500 are on anti-
Anglo American has made a formal commitment to promoting HIV
education and awareness in the areas where they operate, working
with government authorities, NGOs and religious groups. They seek
partnerships with donor organisations as a way of extending access
to treatment to dependants and local communities.
They also lobby national governments about the need to raiseawareness of the risks associated with HIV/AIDS at a national level. A
proactive government prevention and education strategy will likelyreduce the burden on companies and improve the effectiveness of a
Savings resulting from this reduction in absenteeism are “somewhere
in the range of 20% to 60% of the treatment provision costs”according to Anglo, depending on the business involved. This
The main challenge for Anglo American is to get all of their
excludes any additional savings related to increased labour
employees to know their HIV status voluntarily. This is not easily
achieved as there is a fear that if they are HIV positive they will facediscrimination. Anglo American have attempted to address this fear
The resultant reduction in hospitalisation costs has also produced
through policies that prohibit discrimination against potential
savings “within a range of 45% to 70% of the costs over the first 18
employment candidates based on HIV status, and also discrimination
months of a worker’s anti-retroviral treatment provision” according
against existing employees. The company had targeted 50% of
employees to be voluntarily tested by the end of 2006, but after aslow start they actually achieved 63%.
Anglo American conclude from the analysis to date that, in the shortrun, the cost of ART is more than covered by the reduction in
Once HIV infection has taken place, it typically takes 8 to 11 years
absenteeism, reduced healthcare costs (particularly hospitalisation),
before the onset of AIDS. Treatment can delay this onset. Companies
retention of skilled employees and improved productivity. They
such as Anglo American have developed ‘wellness programmes’ to
report that 94% of employees taking medications are capable of a
prolong the health of their HIV positive workers for as long as
possible. These programmes include regular monitoring (CD4counts), the provision of anti-retroviral therapy (ART) for those at the
A welcome side effect of the company’s efforts to tackle HIV is that
relevant stage of infection, nutritional and psychological support. Of
far fewer Anglo Coal employees are contracting tuberculosis (TB).
course, this requires voluntary testing to have taken place.
The number of new cases of TB has dropped by almost 75% since2001. Increased health awareness and medical testing as a result of
Anglo American have been carrying out an economic evaluation of
HIV programmes have led to early diagnosis and treatment of those
the impact of HIV/AIDS since 2003 with the Aurum Institute for
with TB. Because their immune system is weakened, people with HIV
Health Research. The study has evaluated the impact of HIV and
are at a much higher risk of developing active TB. Anti-retroviral
AIDS without ART, and also the costs and benefits from
treatment for HIV can help to prevent TB and other opportunistic
Results to date show that HIV/AIDS costs to Anglo companies wouldconstitute 2% of payroll (range 0.12-2.55% based on 2003-2005
Dr Brink, who implemented Anglo American’s policy on making
data) if ART was not available. The projected costs would peak
treatment available to their employees, points out that despite the
cost savings from less employee absence and avoidance of costs for
Costs per patient on ART have been declining over time, due to
death in service and pensions for dependents, “at the end of the day
falling drug prices and the spreading of fixed costs over a greater
it was a moral decision – it’s something that no employer in South
number of patients. Two years of implementation cost between
R915 (approx. £144) and R 1,700 (£267) per patient per month.
The cost of HIV testing is estimated at R116 (£8) per employee.
Offset against this treatment cost are short-term savings achievedthrough a reduction in absenteeism. Across business units,absenteeism shows a continual decline from 6-12 and 18 monthsafter commencing treatment, levelling off in later months. This isillustrated in the graph below.
Company Response Examples (continued)
The issue facing pharmaceutical companies such as GSK is a very
Unilever have business operations throughout the world, and
different one to those facing mining companies in areas of high
therefore have businesses and local employees in areas of high
incidence of HIV/AIDS. For GSK the main issue is access to their
product. Before 2001, when the leading HIV drug companies set up
They acknowledge that countries differ greatly in the quality of
a partnership to tackle the issue, they received a lot of criticism from
clinical infrastructure and the cultural attitudes to the disease.
NGOs about lack of HIV drug provision to developing countries. This
Therefore, the role of the private sector must vary accordingly.
has been addressed by establishing an initiative with relevant UN
Where public health systems prevail, Unilever’s contribution will
agencies, called the Accelerating Access Initiative (AAI). The other
concentrate on schemes of education and prevention. Elsewhere,
members of this initiative are Abbott, Bristol Myers Squibb, Roche,
direct involvement in treatment and care may be necessary. Their
Merck, Boehringer-Ingelheim and Gilead.
policies are most advanced in sub-Saharan Africa where thecompany’s programmes have been developed over many years and
Lack of political will and insufficient medical infrastructure are cited
are shared widely with other companies and in society.
by GSK as the biggest barriers to accessing appropriate healthcare in
The framework to manage HIV/AIDS addresses the needs of
developing countries such as those in sub-Saharan Africa. However,
individuals at key stages of prevention and treatment:-
they are making efforts to help by making their essential medicinesas cheap as possible. For example their HIV/AIDS drugs are available
• Awareness through educational programmes for all employees.
at not-for-profit prices to public sector customers and non-profitorganisations in these areas.
• Prevention (including prevention of occupational exposures;
Shipments of Preferentially Priced Combivir, Epivir and GSK-Licensed
• Establishing the HIV status of individuals through voluntary testing.
• Encouraging HIV positive individuals to receive treatment. (Access
Unilever Kenya has had this framework in place for the last 15 years
or so, operating a long running campaign to communicate to its
employees about the disease. Initially this was a brave step as the
condition was still a taboo subject. Early on in the campaign,Unilever Kenya recognised that the problem of HIV/AIDS stretched
beyond their own operations, and that working in partnership was
the only way to tackle the causes. It therefore approached othermajor companies to pool their efforts in fighting the pandemic. This
Combivir, their leading anti-retroviral is available for $0.65 a day.
coalition, called Neighbours Against AIDS meets regularly to share
These not-for-profit prices include delivery and insurance costs.
ideas and experiences. It includes companies such as GSK, GM and
Orders may be of any size, and the drugs will be available
Partly as a result of the coalition, awareness of HIV/AIDS is now
In 2006 they shipped fewer Combivir and Epivir than in the previous
almost total among the Kenyan population, according to the
year (see table above) because of more customers purchasing anti-
Corporate Relations Manager. The Neighbours Against AIDS coalition
retrovirals from generic manufacturers licensed by GSK. This, GSK
is now concentrating on encouraging people to go for HIV tests and
point out, demonstrates that their licencing policy is working.
to think about the risks associated with their sexual relationships.
In the last year, the generic manufacturers licenced by GSK havesignificantly increased their manufacturing capacity and ability to
Unilever share their learning with other businesses, making their
supply larger quantities of anti-retrovirals at lower prices. The
programmes available as models on both the ‘Global Business
company estimates that their licensed generic companies supplied
Coalition’ and ‘Global Health Initiative’ websites.7
over 120 million tablets of their versions of Epivir and Combivir tosub-Saharan Africa.
The World Health Organisation has recently included abacavir as arecommended first line treatment. GSK subsequently managed toreduce the not-for-profit price of abacavir-containing anti-retroviralsby 30% and made their two new anti-retrovirals, Kivexa and Telzir,available at not-for-profit prices.
Product diversion has historically been a problem for pharmaceuticalcompanies, with not-for-profit medicines being illegally shipped backfor sale in wealthier countries. This denies treatment to patients inpoorer countries. In response, GSK has introduced anti-diversionmeasures such as supplying red rather than white Combivir andEpivir tablets.
A report from the Accelerating Access Initiative suggests that by theend of 2006 more than 738,000 people living with HIV/AIDS indeveloping countries were receiving treatment with at least one anti-retroviral supplied by the seven pharmaceutical companies in the AAI(compared to 220,000 people on treatment in 2004 and 600,000in 2005).6
The macroeconomic impact of HIV/AIDS is difficult to accurately
HIV/AIDS has most certainly not gone away, as evidenced by the
predict, but there has been analysis of the issue. The disease
numbers published by UNAIDS which are reported in this paper.
principally affects people in their most productive years of life
Data quality on the prevalence, prevention and treatment of the
(young adulthood) and thus has a negative impact on productivity,
disease is not perfect, but has improved immensely since the 2001
healthcare expenditure, care demands, disposable income and
UN Declaration of Commitment on HIV/AIDS, and serves to
savings. In the long term this reduces the market size, reduces
illustrate the size of the epidemic and the current situation of the
human resources for production and investment and thus leads to
various responses to it. Geographically, sub-Saharan Africa remains
lower economic growth. Ongoing estimates by the World Bank
the worst hit area, but growing numbers with the disease in other
suggest that the macroeconomic impacts of the disease may be
areas, particularly India, China and Russia, are cause for concern.
significant enough to reduce growth of national income by up to a
The macro and micro impacts of the disease are of relevance to the
third in countries with adult prevalence rates over 10%.
companies in which we invest, to varying degrees and in differentways. The three examples demonstrate how different companies
Beyond the macro impacts on companies (impact on markets,
manage the impact that HIV/AIDS has on their particular business.
labour, savings and investments), there are two broad areas where
These should serve as reference for the analysis of other companies
HIV/AIDS is likely to impact on individual business operations:
with significant operations in areas of high disease incidence,particularly in lower income regions.
(i) Declining productivity – increased absenteeism, increased
organisational disruption (staff turnover, skills loss, declining morale)
(ii) Increased costs – recruitment, training, insurance cover, health
costs, funeral costs (where businesses provide this), supplying cheap/free aid (e.g. pharmaceutical companies).3
Another concern for companies is that they may be forced tocompensate for government policy shortcomings. Those businessesthat are affected by HIV/AIDS will need to have different responsesdepending on the quality of government response to the problemby the countries in which they operate. As a result of the importanceof a country’s response to the issue, many companies are attemptingto include the domestic government in their HIV/AIDS strategies.
They understand that they need to work with the government toensure an effective, holistic response to the disease. Many companiesare weighing up the benefits of internal programmes against relianceon public health programmes in the host country of their operations.
However, while 50% of business leaders expect the disease to havean effect on their operations within five years, less than 10% havetaken steps to conduct a quantitative HIV/AIDS risk assessment.4
Responses which have been identified as recommended action forcompanies operating in areas of high disease incidence include3:-
• Create workplace policies to ensure help for infected employees
• Provide grants to HIV/AIDS organisations;
• Encourage other key players (public and business sectors) to get
“2006 Report on the Global AIDS Epidemic”, UNAIDS, 2006.
“AIDS Epidemic Update 2006”, World Health Organisation & UNAIDS, 2006.
“The Business Response to HIV/AIDS: Impacts and Lessons Learned”, The Global Business Council on AIDS, The Prince of Wales Business Leaders Forum and UNAIDS, 2000.
“Business and HIV/AIDS: A Healthier Partnership?”, World Economic Forum, 2006.
“Update on Anglo American’s Response to the AIDS Epidemic in South Africa”, Dr Brian Brink, 2006.
“Corporate Responsibility Report 2006”, GlaxoSmithKline, 2007
“Combating HIV/AIDS in sub-Saharan Africa”, Unilever, 2006, and “Kenya: Fighting HIV/AIDS”, Unilever, 2006.
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