Should Australia partner with Coke in the Pacific?

Coca-Cola bottle (image: Flickr/Francesco Scaramella)
Written by Sam Byfield

On 27 June at the Liberal Federal Council, Foreign Minister Julie Bishop observed that ‘Coca-Cola is available everywhere throughout the Pacific. Any remote village, any hilltop, Coca-Cola is there.’ My initial reaction was ‘ah ha! – finally recognition of the role of big business in driving obesity and chronic disease across the Pacific’, but I was chastened as Bishop continued, ‘…so we’ve decided to partner with the private sector to use their distribution networks, their supply chains, to get essential medicines to where they are needed.’

While Bishop didn’t say which private sector organisations the Australian Government would partner with to improve drug distribution networks (citing Coke only as an example of a business that excelled at distribution), the broad theme of private sector engagement in aid delivery, and the specific example of Coke, raise some important philosophical and practical questions that deserve to be discussed. Should Australia partner with Coke in the Pacific?

It is certainly the case that, despite various aid interventions, access to medical supplies in the Pacific, particularly in remote areas, is often limited and that this has an impact on public health. Contrastingly, Coca-Cola’s reach extends to even in the most remote corners of the Pacific, and its supply chains are second to none.

In her speech, Bishop cites Coke’s role since 2010 in delivering drugs for HIV/AIDS, tuberculosis and malaria in a number of African countries. This work is undertaken in partnership with the Global Fund, with support from the Bill and Melinda Gates Foundation. A case study in 2012 highlighted that the initial pilot program in Tanzania had been a success – medicine delivery times had been cut from 30 days to five, and access to vaccinations had been increased. The ColaLife program is also worth noting – since 2011, a public private partnership in Zambia (including Zambia’s Health Ministry, UNICEF, Johnson and Johnson and others) which draws upon Coca-Cola’s supply chains has increased treatment rates with oral rehydration salts and zinc combination therapy from less than 1 per cent to 45 per cent.

The ethics in this area are worthy of debate, and in June 2015 the BMJ published such a discussion. Proponents of the ColaLife program cited impressive improvements in access to oral rehydration therapy and suggested that the views of those who see partnering with Coca-Cola as unethical would ‘soften if they understood…the extent of our work and the effect it is having.’ Arguing against engaging with multinationals to deliver health programs, Nick Spencer said that ‘Multinational companies are in business to sell their products – not to promote the health of children.’ He also cited Coca-Cola’s ability to provide their products in remote areas, and the Zambian Government’s inability to supply simple medicines, as ‘emblematic of the unequal power relations between governments and huge multinationals, particularly in poor countries.’

While the principle might be the same, there would be some big differences between working with Coca-Cola in Africa to deliver infectious disease medications or oral rehydration, and engaging with Coke (or other companies from the Big Soda or Big Food space) in the Pacific. Around three quarters of all deaths in the Pacific are caused by non-communicable diseases. One of the biggest drivers of this epidemic is unhealthy diet, including the consumption of sugar sweetened beverages like Coke. Over 80 per cent of people in most Pacific island nations are now overweight or obese. Tonga typifies the challenges facing the Pacific: diabetes and heart disease are the two biggest causes of premature mortality, and the three biggest disease risk factors are high body mass index, high fasting plasma glucose, and dietary risks. Highlighting just how quickly lifestyles and disease drivers have changed, figures from 2004 showed that over the previous 30 years the average weight for both males and females in Tonga had increased by about 20 kilograms; while type 2 diabetes prevalence had increased from 7 per cent to 18 per cent.

Evidence concerning the role of sugary drinks in driving the regional and global NCDs epidemic continues to grow stronger. A new study in the American Heart Association’s journal Circulation has found that sugary drinks kill approximately 184,000 people each year. It’s worth remembering that one bottle of Coke alone exceeds the recommended daily intake of WHO’s Sugar Guideline, and in the US obesity is overtaking tobacco as the leading cause of cancers.

World leaders have increasingly recognised that the globalisation of unhealthy food and beverages is a profound public health challenge. In 2013, WHO Secretary-General Margaret Chan argued that ‘Efforts to prevent non-communicable diseases go against the business interests of powerful economic operators. In my view, this is one of the biggest challenges facing health promotion.’ In the Pacific, leaders proclaimed in 2011 that NCDs have become a ‘human, social and economic crisis requiring an urgent and comprehensive response.’

Another danger of a possible partnership with Coke in the Pacific would be that it might create a ‘healthy halo’ effect – where socially responsible companies are perceived to have healthier products – in much the same way, for instance, as sponsorship of children’s sports or the inclusion of fast food products in hospitals.

A final consideration, as one commentator noted in relation to Coke’s partnership in Africa, is that the program might increase Coke’s influence among health policymakers: ‘when host country governments depend on Coca-Cola to develop their supply chain networks, is there any chance they would push back against the corporation on public health issues?’

Ultimately, the Foreign Minister’s statement raises questions about the nature of Australia’s engagement in the Pacific, and how Australia plans to engage with the private sector in aid delivery. We don’t know if Australia is contemplating a partnership with Coke, but I would advise against it, and focus instead on other ways, public or private, to increase the reach of medicines in the Pacific. Medical supply distribution might be enhanced, but overall our health improvement efforts in the Pacific will not go better with Coke.

Sam Byfield is a global health consultant, a Senior Honorary Fellow of the Nossal Institute for Global Health, and is studying a Masters in International Law at the University of Melbourne.

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Sam Byfield

Sam Byfield works as Executive Officer to ANU Chancellor Professor the Hon Gareth Evans. He is also an Honorary Senior Fellow and Lecturer at the University of Melbourne's Nossal Institute for Global Health, and consults in global health and aid policy.

13 Comments

  • Thanks everyone for your comments and thoughtful debate on this article. ABC Radio hosted a panel session (with Simon Berry and Tim Costello, among others) that addressed some of these issues – it can be found here.

    Sam

  • As I read it, the logic of this article’s argument is:
    1. Coca-Cola has extensive reach and “its supply chains are second to none”. The company’s supply chains have been used successfully to transport medicines in Africa.
    2. Coca-Cola contributes to an unhealthy diet, and an unhealthy diet causes serious health problems in the Pacific.
    3. Therefore, it is unethical to use Coca-Cola’s supply chains to distribute medicines in the Pacific.

    I’m struggling to make the leap from 2 to 3, especially where health products can be “de-branded” and disassociated from Coke. Mostly the conclusion rests on the inherent unhealthiness of Coke. But the premise of #1 assumes that Coke is already everywhere regardless. In order to offset the real benefits that would come from the improved transportation of medicines, this argument would need to establish how hitching a ride on Coke’s already established supply chains would in any way affect consumption of Coke. Or to put it another way, how not using Coke’s supply chains (and forgoing the health benefits associated with improved medicine distribution) would in any way reduce the consumption of Coke. I can’t see how it would.

    We should be careful not to compare an ideal public solution with a real-world private sector solution (holding the two to different sets of standards). It would be great if public supply chains functioned in an ideal way — reliably providing subsidised merit goods to all on the basis of need. However, we know this is not the case. Private supply chains are structured in a way that incentivise the reliable provision of goods in remote areas. This is not true for public supply chains in many developing countries, and this is unlikely to change. If public supply chains were working as intended, we would not be here talking about piggy-backing on Coke’s. We should compare this proposal (with all its challenges) to the alternatives that currently exist, not a perfect ideal.

  • Thanks for this well-balanced and considered article – much more constructive than some of the ‘kick-back’ commentary we see, which actually stifles proper debate.

    It is important to keep an open mind and be prepared to think the unthinkable when you are faced with stubborn global health challenges, as you never know where this might lead you. We have to acknowledge that some of the current approaches to improving access to medicine are not working and haven’t worked for many years. Access to diarrhoea treatment in Africa is one example. In these circumstances we have to ask: do we carry on doing what we’ve always done or do we seek to innovate and try other approaches?

    On the basis that it’s easier to act your way into a new way of thinking than think your way into a new way of acting[1], ColaLife did the unthinkable and designed a diarrhoea treatment kit – called Kit Yamoyo – that fitted in the unused space in Coca-Cola crates. The logic was simple: Coca-Cola gets everywhere so if medicines went with it, they would get there too. From a standing start and within 12 months we’d got diarrhoea treatment rates up from less than 1% to 45% in the two remote trial areas in Zambia. And this is for an international standard treatment that has been around for 10 years.

    The big surprise was that only 4% of the 26,000 kits sold actually travelled to remote communities in Coca-Cola crates. This was not the innovation we thought it was. It wasn’t the space in the crate that was important, it was the space in the market. What the folks at Coca-Cola taught us was how to design a product together with its value chain. That’s what they do with a brown fizzy drink. We learnt this and applied the same principles to a health product with potentially game-changing results. Following the trial, we are now working with the local manufacturer of Kit Yamoyo in Zambia to establish it in the market, while in parallel, and inspired by our work, the Government of Zambia have ordered 452,000 ‘unbranded’ kits to be given away free through health clinics in 11 of the most nutritionally deprived districts in Zambia. These alone will save 1,350 lives if the ‘lives saved’ modelling done for our trial holds true for the scale-up.

    The key points to note from our experience are:

    1. We would not have made the progress we’ve made if we’d shut down the possibility of talking to Coca-Cola ‘on principle’.
    2. During our trial and during the scale-up there is no association between our anti-diarrhoea kit and Coca-Cola. None of those involved in the marketing, distribution and sale of Kit Yamoyo have any idea that we are mimicking the drinks giant’s methods. Kit Yamoyo doesn’t even carry ColaLife branding let alone Coca-Cola branding.

    Coca-Cola’s involvement in Tanzania and Ghana with the national essential medicines distributors is also advisory. They are helping the existing organisations responsible for the distribution of medicines in the public sector to become more efficient and effective. They are building local capacity, they are not ‘taking over’ the distribution.

    And that brings me to my final point and a key area of general misunderstanding. Many fall into the trap of assuming that the Coke they see in remote places is taken there by Coca-Cola and therefore attribute Coca-Cola with having the most amazing global distribution system. The truth is that if you go to any of these remote places you will never see a Coke truck or van. Coca-Cola is brought to these remote communities by independent micro-retailers and entrepreneurs and they bring it because people want it and they can make a profit selling it to them. The system works by clever product design and marketing and the creation of a value chain which ensures that everyone who touches the product on its journey to consumers makes a profit and the target customers can afford it.

    Obviously, you can only apply these principles to a health product if that product can be ‘commoditised’. Fortunately, you can do this for an anti-diarrhoea kit but you couldn’t do it for the majority of medicines. However, that doesn’t mean that you can’t use existing private sector channels to get more complex medicines to trained health personnel in remote communities and you can read ColaLife’s thoughts on this here. Again, although this idea is inspired by the ubiquity of Coca-Cola it can be implemented with no reference to The Coca-Cola Company.

    Sure, let’s be aware of the ethical issues but let’s keep an open mind and consider all possible options when it comes to improving the health of some of the poorest people on the planet.

    Simon Berry
    CEO
    ColaLife

  • For me, I think ultimately it comes down to the fact that distributing medical supplies through a system like Coca-Cola’s is a great solution for the short-term. For the long-term, however, we need to be investing in building robust supply systems that do not require support from producers with potentially questionable interests.

    • The evidence from Colalife proves that the MOST robust supply chain is one where micro-entrepreneurs are incentivised and make money from the process. If I interpret your wording ‘robust’ to mean that which occurs typically in the Western world then this won’t work to benefit players along the supply chain, isn’t inclusive of small players and will suffer failure to reach the last mile.

      • @Benjamin – this is right. Coca-Cola does not do ‘the last mile’, it’s the small entrepreneurs serving those communities at the end of ‘the last mile’ that do that and they do it for many other products too (cooking oil, talk-time, salt, torch batteries, washing powder, etc) not just Coke.

        • Although this is not the focus of our work at the moment (we’d be very happy for someone else to take this on!), we think that this existing distribution channel (ie the one ‘owned’ by small community-based entrepreneurs and shop keepers that runs from district centres to remote rural communities) could be used to courier basic medical supplies to trained health workers serving remote rural communities. Please see: ‘Could the private sector supply remote health posts in Zambia’.

          We believe that this would be far more efficient and would have a bigger development impact (money in the pockets of local entrepreneurs) than trying to set up a parallel public sector system to do the same thing. Even if this could be done it will take many decades and would be massively costly and in striving for this we are asking the already overstretched public sector to achieve something that even Coca-Cola (or any other producer of fast moving consumer goods) can’t do and prefers to leave to others.

  • Coca Cola is a product available for people to decide whether they want to purchase or not. To change the behaviour of people when it comes to their lifestyle, we should not necessarily be depriving them of that (since, by using this logic, one of the aims of aid in the Pacific could be to prevent Coca Cola, junk food and cigarettes from getting into stores). Instead, we should be helping Pacific Governments to educate people on why deciding to buy Coca Cola or packet of cigarettes is bad for them, and providing support for the emergence of healthier, affordable alternatives.

    • Reliance on education alone is an inadequate way to change behaviours. For example, most people know what they should do with their diet and exercise, but doing it is a whole other story. We’ve known for a long time now that you need multi-level and faceted approaches to assist people to make healthy choices, particularly when they are making choices for their future self. Not only do we need to educate people, but also reorient health services so that they encourage health-supportive behaviours, build healthy communities and create the broader structural conditions that enable the healthy choice the easy choice. As we saw in NZ, there were a raft of measures to reduce smoking such as legislating, encouraging and supporting quitting, ensuring health systems encourage and support quitting, careful advertising, norm-creation and continuing to restrict purchase. Even then we haven’t managed to stop smoking altogether.

      Evidence shows that reducing soft drink consumption will make a solid contribution to reducing risk factors for NCD’s, and bans can help. I have no problem legislating against fizzy drinks, which have no nutritious value, and contribute to a great deal of suffering in the long term. We should be working with Pacific governments to find evidence about what works and supporting them to enact whatever measures they think will work to make sure their people can be healthy and productive.

  • Coca Cola might very well have knowledge and skills which could be useful in improving medicine and food distribution networks in developing countries and I think we should make use of their advice. However Coca Cola’s clear contribution to ill health seems to me to make it highly inappropriate and not constructive to link health service delivery to their activities.

    In addition, if we would not rely on private food companies to distribute medicines here, why would we promote this in other countries? It is clear that many poor countries do run effective health services and drug distribution networks and we should be providing effective assistance to our Pacific neighbours to help them to do likewise.

    • Very well said Garth. The health strategy is about building health systems. Using Coke’s distribution networks might be a quick fix but does nothing to build strong systems in the Pacific.

      Great blog Sam – a very good read. The thing that I would add is that the whole “let’s use Coke to distribute medicines” thing was a big deal in the African ART context around 2006. The Australian government is just getting on to this in mid-2015…

  • Hi Sam,

    Good post. I would add two points:

    1. I don’t know what parts of the Pacific Minister Bishop has been to, or which hills she has scaled, but Coke was scarce in the parts of rural Solomons I travelled through. Rural health clinics, on the other hand, while under-resourced, were present, could provide first aid, and were possibly the cause of the decline in Malaria that was frequently commented on by people I spoke to.

    2. Beyond that: Coke and medicines are, conceptually, two very different things. Coke is a private good (we don’t worry too much if people can’t afford it); medicines are merit goods (we hope to live in a world where anyone can access the medicines that they need). With private goods it is comparatively easy to leave it to markets to deliver (and if they don’t it’s not usually the end of the world). With merit goods there is often a need for government subsidies to make sure that everyone has access. But having the government subsidising private delivery networks brings with it accountability and political economy risks of its own. (How do we know the private sector is actually delivering what it says it has? And can we be sure that the potential for profit is not causing it to exert undue influence on what should be technocratic or democratic decisions about distribution?) This doesn’t mean we should never engage with the private sector in delivery, but it does complicate matters considerably, particularly in poorly functioning polities.

    Thanks for a good post on what sounds, at first glance, to be a poorly thought through decision.

    Terence

    • Terence, I want to clarify that Sam’s article was not written on the premise that there has been a decision to partner with Coke. Coke has been used by donors elsewhere, it got a favourable mention from the Minister, and Sam was analysing whether the Australian aid program should partner with Coke in the Pacific, not critiquing a decision to partner with it.

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