Supply and demand.
In economics, the laws of supply and demand theorize that at higher prices, buyers will demand less of a good. And—vice versa—at higher prices, sellers will supply more of a good.
At least, that’s what the textbooks say.
In the real world, however, economic theory doesn’t always account for things like fairness or social responsibility.
Each year, pharmaceutical manufacturing companies and nursing homes in the U.S. throw away billions of dollars’ worth of prescription drugs. These drugs, known as short-dated medication, are near the end of their expiration date. But that doesn’t necessarily mean they are no longer effective or useful. For pharmaceutical manufacturers, however, these drugs simply cannot turn a profit effectively. So, they’re destroyed.
Sourish Jasti, a freshman at The Wharton School of the University of Pennsylvania, Shreya Kavuru, a senior at St. Paul’s School, and Rahul Kavuru, a junior at St. Paul’s School, first learned about the issue from a pharmaceutical executive who told them how much goes down the drain each year in excess or short-dated medication.
In hopes of offering more effective solutions to the waste problem, the three students formed the Altrui Foundation, a non-profit organization that helps distribute excess or short-dated medication to underserved communities.
“We take this short-dated medication from the hands of manufactures and we’re able to send it over to charitable organizations that work with uninsured patients or people in disaster areas to make an impact,” Jasti says.
Since becoming incorporated as a non-profit organization in April, the Altrui Foundation has worked with pharmaceutical companies such as Rising Pharmaceuticals and Ingenus Pharmaceuticals and charitable organizations such as Kingsway Charities and CitiHope Relief & Development. The collective efforts have helped facilitate the redistribution of unused medication worth roughly $15 million to those in need.
Rethinking The Industry Process
The idea of redistributing excess or short-dated medication to charitable organizations is not new.
In Iowa, a non-profit organization called SafeNetRx has been providing donated medication at an affordable price to underserved communities since 2001.
But what Altrui Foundation is trying to do is make that donation and redistribution process easier for both the manufacturers and the charitable organizations.
“There’s a huge, long, and messy process between the pharmaceutical manufacturers who make the product and the charitable organizations who are responsible for distributing it,” Jasti says. “The old process would be one organization reaches out to as many manufacturers as they can for a certain product. They would go to five to ten different manufacturers and would essentially cold call. Sometimes there’s a relationship set up. Sometimes there isn’t. Sometimes they wouldn’t get the medication that they needed.”
Often times, according to Jasti, what ends up happening is a pharmaceutical manufacturer just decides to simply destroy unused medicine rather than deal with the complicated logistics of redistributing that medication to a variety of organizations.
And that, in turn, is where the waste really starts adding up.
“The manufacturers usually end up holding on to this medication,” Jasti says. “They spend anywhere from one to five dollars per pound on destruction costs and they also need to take into account operations of storing the product, having the manpower, and moving it into incineration – a huge environmental problem as well considering how many millions of pounds are being destroyed each year.”
Altrui wants to change that.
The foundation provides manufacturers and distributors with a centralized hub, the Altrui platform, to safely and efficiently redistribute excess or short-dated medication to underserved communities at no cost. In many ways, Altrui is a conduit between manufacturers and charitable organizations to ensure smooth and effective redistribution.
“We’re the middle of that process,” Jasti says. “We facilitate the data, which includes the inventory list and the medication requests.”
While the foundation is advised by a board of CEOs and industry experts, the core team is made up of primarily college or high school students – ranging from young entrepreneurs, computer scientists, medical students, and marketers – all of whom are dedicated to social impact work.
Putting The Wharton Education To Use
Jasti is a learner. A polymath of sorts.
In high school, he launched a business blog called Company Roots, where he interviewed industry leaders and entrepreneurs to learn about how they got started on their revolutionary ideas.
In his sophomore year of high school, Jasti founded the Jasti Clean Water Initiative, an organization that strives to help provide access to clean water to rural villages and schools in India.
Wharton was a clear next step for someone like Jasti who has big ideas and an even bigger urge to turn those ideas into impactful solutions.
At Penn, Jasti connected with other talented peers such as fellow first-year Justin Zhang, an engineering student at Penn who now leads development of the Altrui platform. He joined the Wharton Private Equity and Venture Capital Club, where he’d meet with “super-smart people who really know what they’re talking about.” And he sat in on classes taught by accomplished professors who he views as inspirations.
“Some of these professors are on Biden’s COVID task force,” he says. “Some of them are doing front-line research that’s actually impacting how we deal with COVID. Seeing people who are dealing with such real issues like this is amazing.”
While he’s already accomplished more than many have at his age, Jasti isn’t content. He says he wants to continue learning everything he can during his time at Wharton and take the Altrui Foundation to the next level.
Over the next few years, his goal is to expand Altrui to dozens of manufacturers and charitable organizations and, ultimately, reduce the industry’s overall inefficiencies to make life-saving medication accessible to those who can’t afford it.
In other words, Altrui may just become that company that shatters everything you thought you knew about economic theory.
“As economics majors at Wharton, we’re always learning about these theories of supply and demand and figuring out the best way to work with these ideas to make a company. I guess that’s kind of what Altrui is.”