GLOBAL DRUG FACILITY Improving country access to anti-TB medicines

GLOBAL DRUG FACILITYImproving country access to anti-TB medicinesAndrea de Lucia, GDF Team Leader 1st line Country Support

WHO/UNICEF Technical Briefing Seminar on Essential Medicines Policies1 October 2011

220th Coordinating Board Meeting | Washington DC| 31 March – 1 April 2011

ROLE OF GDF

Established 2001, GDF is an initiative of the Stop TB Partnership hosted by WHO

• Public Sector procurement of anti-TB drugs, of the right quality, quantity, and price, and deliver them at the right time to the right people

• Originally established to provide in-kind 1st line anti-TB drug grants, since added direct procurement services as countries have other sources of funding available

• Provide limited technical assistance by monitoring drug management in countries utilising GDF’s services and highlight system strengthening requirements.


GDF PROCUREMENT FACTS 2010

• Total value of goods procured: USD112,107,433

• Value of grant expenditure: USD36,792,474

• Value of direct procurement services expenditure: USD75,305,619

• Total cost of procurement agents: USD5,322,781 (GIZ 3.9%, IDA 4.2%)

• Estimated FLD patient treatments: 2,293,207 (242,490 paediatrics)

• Estimated SLD patient enrolled: 10,742

• Number of countries using GDF’s services: 93

• Stock-outs reported to GDF thru monitoring missions: 12 (10 in Africa region)

• Emergency and urgent orders requested: 87

TB Drug Manufacturers Meeting, New Delhi, 29-30 August 2011

Global FLD market estimated b/w USD261 – 418 million in 2008* GDF has approximately USD50 million of this market

Global SLD market is unknown**GDF has approx USD57 million of this market

Source: *TB Alliance (2008) **(2011)


GDF PROCUREMENT FUNDING TRENDS

ex works value or order placed 2007-2010 per funding service

$17

$29

$40

$75

$21

$42

$22

$37$38

$71

$62

$112

$-

$20

$40

$60

$80

$100

$120

2007 2008 2009 2010

Mil

lio

ns

DP

Grant

total


Ex Works value of orders placed 2007-2010 per funding service


GDF PROCUREMENT CHALLENGES – FLD/SLD SUPPLY

• Limited number of API producers. • Stringent prequalification requirement results in a

lack of incentives to prequalify products• Insufficient number of quality assured products can

result in the interruption of supply of drugs (Streptomycin)

• Limited number of TB drug manufacturers also results in a lack of competition (high prices) and overstretches suppliers (late deliveries).



GDF PROCUREMENT CHALLENGES – FLD/SLD DEMAND

• Market fragmentation: multiple entities procuring• Poor forecasting of requirements by clients• Insufficient budgetary and procurement planning • Volatile funding commitments from donors and

governments cause havoc in planning• Emergency requests with short delivery lead times

stress all actors (allow 8 months delivery lead time).



COMMENTS ON FLD BIDDING 2011

Prices have increased significantly since 2009

GDF observed:

• Increased unit prices attributable to API costs, namely R, and fuel costs in India

• For products where there was competition, price ranges were generally similar

• For those products where there was no competition, price increases appeared unreasonable and unjustifiable – eg paediatrics



PRICING OF HIGH DEMAND FLDS AND PROJECTED DEMAND*


* Based on retrospective analysis of demand in 2010


COMMENTS ON SLD BIDDING 2011

General price containment since 2009

GDF observed:

• Out of 23 products, 12 have only 1 quality assured manufacturer – ie no competition

• Excepting capreomycin and moxifloxacin, no significant price differentials since 2009

• Volumes procured to date have not resulted in price reductions

• Price reductions are only likely in future if demand is further consolidated

• Market sustainability is a concern



PRICING OF HIGH DEMAND SLD’S AND PROJECTED DEMAND*


* Based on retrospective analysis of demand in 2010


GDF'S RESPONSE TO PROCUREMENT CHALLENGES

• Manufacturers offering staircase pricing where demand can be consolidated (move towards quarterly ordering and have a dedicated forecasting staff at GDF)

• New FLD/SLD LTA's have a heavier liquidated damages clause for suppliers not honouring delivery lead times

• Rethinking stockpile options:

– warehouses in strategic logistical locations and financing scheme options.

• Continue providing adult/paediatric FLD grants as we expect budgetary gaps due to price increases over 2011-2012: countries must plan and identify gaps early to allow for application review and delivery (8 months)

• Strengthened GDF technical assistance at regional level beginning 2012: Regional Technical Officers to provide assistance in procurement planning, quantification, monitoring and order placement.



TECHNICAL ASSISTANCE – GDF MONITORING MISSIONS

Monitoring missions conducted in 55 countries in 2010

Objective•Validate stock levels•Monitor GDF terms & conditions (grant & direct procurement)•Assess overstocking and stock outs•Assist with planning for future requirements•Highlight problems in supply chain

Key Observations•Gaps in PSM staff capacity/training•Lack of Standard Operating Procedures•Poor information management (manual vs computerised)•Inadequate planning of requirements/funding•Reliance on donor funding and associated volatility•Political commitment to change is not always evident



TECHNICAL ASSISTANCE – GDF DRUG QUANTIFICATION TOOL

Developed in partnership with MSH for 1st line drugs

Objective• Quantify countries annual needs for procurement planning and budgeting

purposes (GDF 1st line drug prices), using morbidity data• Determine low long quantities of stock on hand will treat estimated patients• Determine trigger dates for reordering• Adjust buffer stock % based on projected demand & available budget

Key Observations• User friendly but staff training is required to utilise and interpret the

information for planning purposes• Quantification requires good data – NTP needs a good surveillance system

to know: – exact number of patients treated last year– number of patients in each treatment category– existing stock levels of each item



TECHNICAL ASSISTANCE – DRUG MANAGEMENT WORKSHOPS


With our partner MSH, GDF organizes drug management workshops focused on helping countries identify their PSM bottlenecks and develop an Improvement Plan

Curriculum includes:

• Selection Rational drug use

• Quantification Quality assurance

• Procurement Inventory control

• Hosting country site visit to relevant sites (Central NTP, Central warehouse, NRA, health centres)

• In 2010, regional workshops held in AFRO and EURO; joint consultants training for EMRO/AFRO (Nairobi)

•In 2011, global workshop focused on the drug management and 2nd line drugs (Sri Lanka)

•In 2012, continued regional workshops with new Regional Technical Officers once recruited.


Main messages

1. FLD price increases will affect most countries' planned budgets

2. Start early to identify gaps in drug procurement budgets

3. Allow sufficient time for securing additional funding (if necessary), order placement, manufacturing lead times, and SEA shipment (most cost-efficient)

Thank you!

Andrea de [email protected]

Documents

GLOBAL DRUG FACILITY Improving country access to anti-TB medicines