Pooled Procurement and Other Strategies to Secure

Drug Supply at the Lowest Cost for IOP

ClinicsMichele Forzley, JD, MPH

December 16, 2003

St. Jude Research Hospital

International Outreach Program

Memphis, TN

Overview

¨ 1. The problem¨ 2. Global solutions and background¨ 3. Pooled procurement¨ 3. Country specific support¨ 4. Where to start?

The Problem

¨ It is difficult for the international sites to obtain necessary drugs with the highest quality at the lowest cost.

Underlying Causes Are the Foundations for Solutions¨ 1. Clinic capacity¨ 2. Health system capacity ¨ 3. RPM¨ 4. Finance $$¨ 5. Global problem ¨ 6. Trade¨ 7. Legal

Global Solutions Theoretical background

WHO framework for access to essential medicines

a. Rational selection

b. Affordable prices

c. Sustainable financing

d. Reliable health and supply systems

e. New element - global transport

Global Solutions

¨ 1. Build capacity/infrastructure¨ 2. Grants, foundations, and

global public health actors¨ 3. Training, Tools & Resources¨ 4. Essential medicines strategy¨ 5. ICD category¨ 6. Tariffs and transportation costs¨ 7. Impact of trade environment

Build Capacity/Infrastructure -nationally and at the clinics

¨ 1. Skills development- training on projections/ sourcing/trade/ ….

¨ 2. Local DRA- essential meds, registries.¨ 3. National Advisory Board.¨ 4. Garner existing resources,WHO/UNICEF

price/supplier information, tech. assistance.¨ 5. Quality – WHO Collaborating Centers.

Training

1. International procurement and basics of pooled procurement

2. Developing supply projections and management of drug supply

3. Work with local experts example in MidEast - Abu Ghazaleh Casin Center for Trade Policy Capacity Building (Amman)                         

Develop Tools and Resources

¨ 1. Cure for Kids training vehicle¨ 2. Manuals, software¨ 3. Custom and ready made¨ 4. Electronic and traditional

Grants, Foundations, and Global Public Health Actors 1. Gates, Rockefeller.

2. UNICEF, PAHO, GFATM, EMRO, IFPMA, WTO, USAID-MSH.

3. Donations - in kind and cash.

   a. Outright donations.

b. Industry, national oil company, Arab Funds (for development) and associations such as Jordanian Pharma Manufact. Assoc.

c. NIH research funding.

Acquisition of Essential Medicines Is a Global Problem¨ Integrate pediatric oncology medicines into

national and WHO essential medicines lists.¨ Upgrade cancer registries in each country -

NIH funding.¨ Research in order to prioritize needs for

local morbidities. ¨ Separate ICD category?¨ Orphan or neglected disease? Public fund?

Trade Matters

¨ Reduce tariffs and transportation costs¨ Lobby to prevent unintended consequences

of bi-laterals- see US-Morocco bi-lateral 20 year patent

¨ CAFTA, FTAA

Pooled Procurement

Drug Management Cycle

1. Selection/formulary

2. Procurement

3. Distribution

4. Use – Standard treatment guidelines

Existing MOH-MOH Models¨ 1989 Maghreb ¨ Gulf Cooperation Council- Bahrain,

Kuwait, SA, Oman, Qatar, UAE 2002- $178million – 30% price reduction

¨ Organization of Eastern Caribbean States 37% price reduction - 9 states

¨ ACAME Assoc. de Central D’Achats de Medicament (Sub-Saharan Africa)

¨ WHO Pilot Procurement Project¨ PAHO Virtual Procurement

Best Practices for Pooled Procurement

¨ Transparent and credible system¨ Guarantee prompt payment to suppliers¨ International competition¨ Reliable MIS for tendering and contracting ¨ Active participation from client clinics¨ Existing umbrella organization¨ Quality assurance system

Best Practices continued

¨ Common language among members¨ Convertible currencies among members¨ Legal/policy mechanism¨ Direct remittance > base costs¨ Uniform drug needs- based on P & I¨ Variation in what is pooled- information to

resources

Strategies and Levels of Pooling

¨ 1.St. Jude clinics – just for medicines¨ 2. Foundation based pools- e.g. AFINCA

and AGIR¨ 3. Clinics join cancer hospital pools¨ 4. Clinics join MOH based pools devoted to

essential medicines, e.g. GCC ¨ What is pooled is also a strategy

Day-to-day Operations1. Legal contracting

2. Direct negotiations with vendors

3. International sourcing e.g. China- - supply contracts

4. TRIPS flexibilities - work with national governments/WTO/technical cooperation

5. Compounding and contract manufacturing

6. Emerging pharmaceutical/generics industry of Jordan, Brazil, India, Morocco

7. Wholesale drug/warehousing companies in other countries/regions

Where to Start?

¨ 1. National Assessment.– Trade and IP issues.– Status of local pharmaceutical system.

¨ 2. Drug assessment/what are the needs?¨ 3. Get everyone on board- clinics, national

stakeholders, assemble national advisory group, develop and implement pooling organization.

Trade and IP Assessment

TRIPS IP Law Bi-lateral with US?

Jordan Yes Yes Yes ? terms

Lebanon Yes Yes No

Morocco Yes Yes Yes? terms

Syria ? ? No Egypt Yes ? Yes

Drug Assessment

¨ Methotrexate – example– Patented or branded in each country?– Local generic supply?– Local production capacity? GMP?– Import OK?

¨ Clinic inventory and projections

Next Steps and Questions

Thank you for your attention!

Michele Forzley, JD, MPH

301-565-0538

mforzley@comcast.net