Celebrating 30 years of helping you give wisely
America's most independent,
assertive charity watchdog

Appetite Stimulants for the Starving: In-Kind Donations Are Not Always Kind to Recipients

   Apr 01, 1998

It is easy to be impressed when reading of the large quantities of donated medical supplies and drugs that charities and businesses send to areas devastated by wars, earthquakes and other disasters. These donations usually help to alleviate human suffering but sometimes they cause additional problems.

Here are some examples from the World Health Organization (WHO) of in-kind donations that made bad situations worse:

  • During its war for independence, Eritrea sent out carefully worded requests for medical supplies needed by its suffering population. In many cases the specific requests were overlooked and large quantities of inappropriate drugs arrived in this distressed country. Those drugs included seven truckloads of expired aspirin tablets, which took workers six months to burn, and 30,000 bottles of expired amino acid infusion that could not be easily disposed of because of its strong smell. 
  • Southern Sudan was devastated by war in 1990. Amidst the rubble and the intensity of the rescue effort, the goods arriving included a shipment of fifty boxes of donated drugs. All were labeled in French, which is not spoken in Sudan, and only twelve boxes contained drugs that were at all usable. Some products were highly inappropriate, such as appetite stimulants and contact lens solution, and other products could have even been dangerous for Sudanese people.
  • In Lithuania in 1993, eleven women temporarily lost their eyesight because they were accidentally treated with a donated veterinary drug that had been received in packages without product information. Doctors had incorrectly matched the product’s name with leaflets for other products.
  • And during the Bosnian War in 1992–1996, fifty to sixty percent of all donated medical supplies were inappropriate, according to a recent article by a group of European doctors in The New England Journal of Medicine. The doctors suspect that massive amounts of “drug dumping” occurred in Bosnia, including, medical supplies from World War II and plaster tapes dated 1961. By mid-1996 about 17,000 metric tons (or about 37.5 million pounds) of inappropriate medicines were taking up space in Bosnian warehouses.

Why would so much useless or unusable medicine be distributed? A company might have an excess supply of drugs that are about to expire. Rather than incur the costs of destroying or storing the drugs, it might ship them to a stricken region, thereby avoiding expenses and receiving a tax deduction. It costs about $2,000 to destroy a metric ton of medicine. So the donors responsible for giving approximately 17,000 tons of inappropriate medicines cited above may have received some hefty tax deductions and saved themselves $34 million in drug destruction costs that must be paid for by the recipient country or humanitarian groups operating in the field. In addition, the authors of the Journal article cite the health and environmental hazards, and the expenses of storing, handling and sorting unneeded or useless medical supplies.

Handling drugs that are useless, improperly labeled, or do not conform to the needs of the recipient country severely strains the already limited human and financial resources of international emergency-relief organizations. Further, because of the suddenness and immediacy of large-scale disasters, it is difficult to coordinate worldwide relief efforts. For example, when the earthquake in Armenia occurred in 1988, the Armenian government sent urgent faxes to governments all over the world, asking for specific emergency assistance. Massive amounts of supplies arrived so quickly that it was not possible to stop the transport of excess donations. It was therefore not surprising that there ended up being possibly ten or twenty times the needed amount of particular goods, according to Philippe Autier, MD.

The World Health Organization and other entities have developed strict guidelines for donations of medical supplies during large-scale disasters, but there is still much waste and inefficiency. Better coordination and adherence to these guidelines by donors and charities would allow more successful use of available resources.

Charity financial statements often disclose the amount of donated items that are collected and distributed. However, they usually do not tell you how useful these items are to the final recipient or if they will result in additional problems. It is far too easy for a charity to accept all kinds of donated items from contributors who are looking for a tax deduction or who want to avoid the cost of discarding unwanted inventory. To discourage charities from puffing up their charitable purpose expenses with in-kind donations of questionable value and to offer an apples-to-apples comparison with charities that do not obtain in-kind donations, AIP's Charity Rating Guide shows how a charity’s dollars are being spent. AIP encourages charities to separate their cash donations from their in-kind donations to enable donors to see how their dollars are being spent. Beware of charities that include questionable donated goods in their program expenses so that they can claim “99% goes to program.”