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September 1, 2009 at 9:36 AM

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VillageReach fuels change in global health delivery

Posted by Kristi Heim

How did a tiny non-profit in Fremont attract the attention of a global pharmaceutical giant, a multinational beverage company, governments from India to Senegal and a $1.4 million investment announced this morning by a European venture fund?


Women in Mozambique walk for miles and wait for a rural health center to open. The health center is among those supported by Seattle-based VillageReach.

VillageReach has figured how to get health care into the heart of remote communities that others haven't managed to reach -- the so-called "last mile" -- and pay for it with a for-profit energy business.

With billions of dollars being spent to develop new vaccines, bridging the last mile can mean the difference between lifesaving drugs getting stuck in a bottleneck or reaching the people who need them most.

VillageReach applied a logistics model for delivering and tracking vaccines in remote settings similar to the way UPS might deliver its packages. In fact, VillageReach hired a veteran UPS employee to help improve its operations and industry partnerships.


A health center in rural Mozambique is powered by propane supplied by Vida Gas, a company half owned by Seattle-based VillageReach.

The problem typical in developing countries is that medical supplies from big donors like Unicef reach the capital or nearest port city, and national authorities distribute them as far as the provinces, but that's where they sit waiting to be picked up by local health workers -- when they have the time and transportation.

"It's as if your mail is only delivered up to Olympia," said VillageReach President Allen Wilcox.

VillageReach moved that work from a collection-based system to one with dedicated distributors, freeing up health workers to focus on treating patients.

VillageReach worked with the government in Mozambique to set up a fleet of seven trucks and seven field coordinators whose sole job is to get vaccines, equipment and medicines to 261 rural health centers. VillageReach helped acquire some of the vehicles initially, but the trucks are owned and operated by the government health authority.

The field coordinators return to two central offices that have laptops and Internet access, and upload information into an online database. They report what supplies were distributed, how many vaccines were given out and how much inventory was left.
VillageReach has been able to assemble a detailed picture of what is happening at each health center with updates every two weeks, said John Beale, strategic development director, "so we can see the trends for better or worse."

VillageReach can then share the online data with partners in Seattle and with policy makers in Geneva. The management information system VillageReach has developed is receiving a 2009 Tech Award from the Technology Museum of Innovation in Silicon Valley. In Mozambique its program has helped boost vaccination rates from 68 percent to 95 percent, according to an independent study cited by the non-profit.

In a country like Mozambique, where cars and even bicycles are rare, people walk for miles to reach medical care. It's important they find something at the end of the road, said Beale. "The greatest benefit we provide is community confidence in the health care system."

The non-profit supports its work with a propane gas business that also powers much needed refrigeration for the medicine.

The population of northern Mozambique lives largely off the electrical grid. Less than 10 percent of the country has electricity, so most people cook and heat with charcoal or wood.

VillageReach needed energy for critical health services such as sterilizing equipment, helping mothers through childbirth at night and keeping vaccines cold. Propane was their only viable fuel option.

Being entrepreneurs, they launched a company called VidaGas to supply it themselves. The alternative would have been to use donations to buy propane, Beale said, but once those dollars ran out, so would the cold chain upon which the health system depended. "The whole program would not be sustainable," he said.

In 2002 VillageReach partnered with a local non-profit, the Foundation for Community Development, to start VidaGas. (The foundation is headed by Graca Machel, Nelson Mandela's wife. The two paid a visit to Seattle in 1999 and received $30 million for their charities from local donors.)

VidaGas sells gas to the region, offering a cleaner alternative to charcoal, and it's now the largest propane distributor in northern Mozambique. Besides supplying energy for the health system, it's fueling the hotel and tourist industries, small retailers and family homes.

VillageReach is holding up VidaGas as an example of a successful social business that supports a humanitarian mission. Harvard Business School recently published a study of its model for integrating global health programs with social businesses to benefit remote communities.

Luxembourg-based Oasis Capital today announced it will make a $1.4 million investment in VidaGas, which will allow the company to expand its services to more customers and to build additional filling stations.

VillageReach has been hired by the World Health Organization and Seattle-based PATH for a pilot project in Senegal, and by a large pharmaceutical company to conduct a health strengthening program in a remote part of India. The non-profit is also working with a multinational beverage maker to use its vast transport networks to help distribute medical supplies.

Its goal is nothing short of a sea change in global health practices.

"What is unique about VillageReach is we are trying to enhance systems that exist and leave behind a legacy of infrastructure improvements to allow the system to sustain itself," Wilcox said.

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