Early on a warm morning last December, five Tuck second-years, two students from Thayer School of Engineering and Dartmouth Medical School's Center for the Evaluative Clinical Sciences, and their faculty advisor drove through the good-natured chaos of Dar es Salaam, the capital of Tanzania. Jet-lagged from their late arrival the night before, the visitors were dazzled by the life swirling around them. And the retail. Vendors were everywhere—food, clothing, kitchenware, plastic in spectra of unnatural colors, even shoes gaily draped over tree branches.
But as the van turned into the entrance road to the Muhimbili Medical Centre, the vendors' merchandise changed and became emblematic of the students' work. There, unapologetically and without the tidy discreetness of the West, were stacks of coffins for sale. "You can stop and get a soda at one stand," says Don Conway MD T'72, the team's faculty advisor and adjunct associate professor at Tuck and Dartmouth Medical School, "then move to the next vendor and pick out a coffin for a loved one. Large ones for adults, and, most movingly, small, white ones for children."
The students were in Tanzania on a business mission with life-and-death consequences. For three weeks they would collect primary data for their project to determine the feasibility of building a pharmaceutical manufacturing facility for their client, Muhimbili University College of Health Sciences (MUCHS) in Dar es Salaam. In a country where life hangs by a thread, every component of the healthcare system is overwhelmed by disease and poverty. Fewer than 900 doctors are available to care for 1.6 million people living with HIV/AIDS or to treat 16.5 million cases of malaria and 194,000 cases of tuberculosis. These three diseases alone cause more than 300,000 deaths each year, striking especially severely at the young.
Most critically, there is a staggering shortage of medications to stop these death-sentence diseases. According to team member Alison Sekikawa D'00, T'06, 80 percent of drugs are imported, and it follows that the more expensive the drug, the rarer it is. Anti-HIV drugs, for example, can be provided to fewer than one percent of the patients who need them.
As part of its plan to fight this national emergency, the Tanzanian government has granted 3,800 acres of land near Dar es Salaam to MUCHS and designated part of it as an "investment corridor" that will provide space for projects beyond the school's educational mission, specifically including a pharmaceutical plant. "The school has three objectives for the plant," says team member Kelly Tschantz T'06. "To manufacture reasonably priced drugs for Tanzania and other markets, to offer educational and employment opportunities for students and graduates of the MUCHS School of Pharmacy, and to provide a source of income for the school, leading to a fully self-sustaining operation."
A New Model of Cooperation
In the bright-lights, big-city world of global business, why is Tuck interested in one of Earth's poorest nations? Why did Tuck students travel to a country hobbled by its socialist past with miniscule GDP and personal income? And why did each of them volunteer to encounter Africa's twin experiences of crushing poverty and unalloyed hope?
"We want to explore what role major businesses should play in confronting the world's serious problems," says Dean Paul Danos. "The solutions will undoubtedly lie in cooperation across the different realms of society—particularly in business-public cooperation—and the components will include sharing of organizational expertise, technology transfer, investment, and even subsidy. Tuck wants its students to be in the forefront of discovering what works best and developing a new model for that process. The college's long-term commitment to an educational connection in Tanzania," says Danos, "will serve as a great platform to work with and help develop associated business initiatives."
Tuck's Tanzania project, part of the Tuck Global Consultancy course, grew from the Global Health Initiative (GHI), a joint project of Dartmouth College and MUCHS. Building on Dartmouth Medical School's DARDAR (DARtmouth and DAR es Salaam) health study, GHI is engaging the campus in programs ranging from a tuberculosis vaccine trial to training for researchers in East Africa. The initiative is being led by the college's John Sloan Dickey Center for International Understanding, whose director, Ambassador Kenneth Yalowitz, feels that "by bringing all of Dartmouth's strengths to bear on this project, we are establishing a model of broad-based cooperation that can and will be successfully replicated."
Dr. Conway calls Tuck's work in Tanzania "venture-directed philanthropy. We're giving our expertise—our brains—and jointly working with the Tanzanians as they expand their indigenous pharma capacity. The result will be a sustainable enterprise providing medications, profits, and jobs. This is breaking new ground in terms of philanthropy."
Getting the Facts
While many Tuck Global Consultancy projects focus on a discrete business function, such as marketing, finance, or operations, the scope of the Tanzania project was far broader. "Our students in Tanzania started, literally and intellectually, with a bare piece of land," says John Owens T'61, adjunct professor of business administration and executive director of the Tuck Global Consultancy. "Their project was an exercise in comprehensive business-building."
In their research, the team identified and evaluated every factor affecting the feasibility and success of the venture. Their market overview included a primer on pharmaceutical formulation and manufacturing and discussed foreign suppliers of active pharmaceutical ingredients, local competing drug manufacturers, distributors, international and local regulators, and best practices in the industry.
Among the analyses performed by the team was which products the proposed business should manufacture. In their report to the clients, the team considered drugs to combat HIV/AIDS, malaria, tuberculosis, and infection, including over-the-counter products. The analysis considered market demand, the complexity of formulation and availability of technical expertise, competitive cost structure and potential profit, applicability to Tanzania's government-dominated procurement and distribution system, changing standards of treatment, and the potential of the proposed drug to provide educational opportunities for pharmacy students. Several aspects of the project required specialized expertise, and the participation of students from Thayer and Dartmouth Medical School was essential to the outcome. "This has got to be one of the best examples of a multidisciplinary program at Dartmouth," says team member Greg Butz T'06. "Overall, it's a business problem, but it's a problem that also involves pharmaceutical technology, public health, engineering, and construction. We were able to draw the best from three programs to respond to the entire challenge."
But nothing comes easy. Doug Madory Th'06, who received his MS in computer engineering from Thayer this June, took responsibility for assessing construction costs. His forecast included consideration of the formulation and manufacturing requirements, which vary significantly based on which products are manufactured. Even though a local pharmaceutical company—one of only three significant players in the country—graciously helped him, Madory admits that "cost estimates are very hard to nail down in Tanzania." Indeed, when discussing numbers of any kind, the team carefully notes their speculative nature.
Finally, the team took on the classic B-school matters of startup capitalization, operational finance, and corporate structure and control—eye-opening issues for the project's clients. The team proposed scenarios for different mixes of investments from six categories of investor/partners and provided analysis of the control and revenue implications of each. These investors included large pharmaceutical companies, development banks (such as the World Bank), development funds (such as Swedfund), pension funds in developed nations, nongovernmental organizations (such as the Gates and Clinton foundations and the Medicines of Malaria Venture), and venture capitalists, including the Tanzania Venture Capital Fund. The team also modeled pro forma cash flows and profits based on an enormous number of input variables.
For the Future
For Tuck, this recent project in Tanzania is just the beginning. Dean Danos reports that "we're proposing a new course for second-years that will focus on a single social issue and study in depth the responsibilities of corporate leaders. In a sense, Tanzania is a precursor to that course." In the long term, he says, "businesses can't be independent of the health of society. In fact, their future is tied to the health of society."
Not unexpectedly, some of the most significant benefits of this project reside with the students who accomplished it. "One day, the WTO will classify Tanzania as a 'developing nation' rather than 'least developed,'" says John Owens. "When that happens, these students' unique experience will become their unique advantage. They will have participated firsthand in a new way for corporations to become involved with the world."
But most important, these Tuck students will have discovered the soul of Africa and been transformed by the continent's unfailing hope and determination in face of seemingly insurmountable obstacles. Greg Butz spoke for his team when he said: "We were amazed by what our hosts had to overcome to achieve what they have. The odds were against their even surviving childhood, let alone being educated, and yet they achieved and succeeded. And despite the ongoing challenges in their country, they approached everything with optimism. That gives you perspective on how you live your life. It was a transforming experience."
