APG and ASN Bank Sign Access to Medicine Index Investor Statement

Close to 30 investors with AUMs totalling USD 3.7 trillion now stand behind global healthcare initiative.

HAARLEM, THE NETHERLANDS (MAY 11, 2011) - Another two major investors have endorsed the Access to Medicine Index: APG and ASN Bank have recently signed the investor statement, bringing the total number of investors backing the Index to almost 30. Growing levels of support for the Index suggest that improvements in global health are an increasingly important factor when making investment decisions concerning pharmaceutical companies.  

The Access to Medicine Foundation (ATMF) encourages pharmaceutical companies to make medicine more affordable and accessible for people in developing countries. Every two years, the Access to Medicine Index ranks 20 of the world’s largest pharma companies on their policies and achievements in this regard. Companies with a high ranking, such as GlaxoSmithKline, Merck and Novartis, are also sought-after by investors.
“The Index provides an indication of the extent to which companies are prepared for these markets”, says Wim Leereveld, founder and chairman of ATMF. “If you do well in developing countries, it is a sure sign of strong management that knows how to deal with rapidly changing markets. This is a critical success factor that investors are very keen on.”

Index offers relevant information for investors
APG, one of the world’s largest pension asset managers with Assets Under Management of € 277 billion, has been engaged in an active dialogue with pharmaceutical companies since 2008. Eric-Jan Stork, APG’s Senior Sustainability Specialist, explains: “Emerging markets offer attractive growth opportunities for the pharma industry. But these companies can only be successful by developing new profitable and scalable business models, which at the same time improve access to medicine for those with lower incomes. These challenges require a fundamental shift in their business models and not all pharmaceutical companies will succeed. This is why it is essential for investors to know what strategies these companies have for emerging markets. The Access to Medicine Index offers that information.“

According to APG, the Access to Medicine Index has demonstrated increasing levels of robustness and acceptance as a key benchmark and is now respected among different stakeholder groups. The Index acts as a useful addition to the more traditional financial tools used for investment decisions. Furthermore APG’s Eric-Jan Stork adds: “We will bring our knowledge to the table in order to further enhance the ATM Index.”

Investing in frontrunners
With a growing group of investors endorsing the Index, there is also rising pressure on pharma companies to do more for those who need it most. ASN Bank, the largest sustainable bank in the Netherlands, also uses the Index. Piet Sprengers, Head of Sustainability at ASN Bank says: "The pharmaceutical sector has a key role in giving people access to better health and well-being. We want to invest in those pharma companies that are frontrunners in this regard, especially concerning access to health for the global poor. The ATM index is a very helpful instrument for identifying these companies for our investment universe. It also is a good stimulus for companies to perform better." 

One of the Index’s funders is the Bill & Melinda Gates Foundation. In his article ‘How to fix capitalism’ in Time Magazine, Bill Gates encourages multinationals to make their technological skills and innovation capabilities work for disadvantaged societies. Bill Gates sees the Index as an excellent way of confronting top players in the pharma industry with their responsibilities in this respect and giving them public praise if they do well. “When I talk to executives of pharmaceutical companies, they tell me they want to do more for neglected diseases, but they at least need to get credit for it. The Access to Medicine Index does exactly that”, Gates concludes.