1. Pan American Health Organization 1 PAHO Technology, Healthcare and Research Project of Essential Medicine and Biologicals Linking Technical Cooperation in PSM with Aquisition of Strategic Public Health Supplies The PAHO Strategic Fund

2. Pan American Health Organization 2 What is the PAHO Strategic Fund ? DEMAND Selection, Formularies Demand Estimates, Forecasting Financing Analysis Pricing, Supplier, Market Info. SUPPLY Supply System Assessments Regulatory Framework Good Storage, Warehousing Distribution Practices Rational Use ACQUISITION PAHO SF Procurement Other Monitoring and Evaluation

3. Pan American Health Organization 3 The Strategic Fund: A Country Based Initiative 2000: established by the Director of PAHO at the request of Brazil during the 42 nd Meeting of the Directing Council 2004: Resolution CD45R7 of the 45 th Directing Council on Access to Medicines: –Strengthen capacity in programming and planning of supplies –Facilitate the achievement of economies of scale –Promote continuous availability of Strategic Public Health Supplies 2004 & 2005: Resolutions of the 45 th and 46 th Directing Councils in HIV/AIDS: –Critical Line of Action #4 of the Regional Plan in HIV/AIDS for the Health Sector, 2006 – 2015. 2006, Resolution of the 47 th PAHO Directing Council on Public Health, Health Research, Production and Access to Essential Medicines

4. Pan American Health Organization 4 Concepts in Collaborative Procurement Information SharingPooled Procurement Informed BuyingCoordinated Informed Buying Group Contracting Central Contracting Sharing of information on prices and suppliers Joint market research, share supplier performance information and monitor prices Joint negotiation of prices and supplier selection Joint tendering and contracting using a representative organization Countries agree to purchase from suppliers Countries conduct procurement individually Central buying unit on behalf of the countries Source: MSH / RPM Plus, Rockefeller Foundation 2005

5. Pan American Health Organization 5 What is a Strategic Public Health Supply? A product is considered to be a Strategic Public Health Supply when it meets the following criteria: 1.Is included in the WHO list of essential medicines or in the list of insecticides recognised and recommended by an Expert Committee of WHO 2.Is included in treatment protocols or algorithms recommended by WHO and is considered highly effective in the treatment and prevention of disease 3.Contributes significantly in reducing disease mortality and morbidity, improving quality of life for patients 4.Is subject to particular challenges in procurement and supply management 5.Economies of scale can be achieved as volumes purchased increase Initial list focuses on HIV/AIDS, Malaria, TB and neglected disease

6. Pan American Health Organization 6 Operating Structure Strategic Fund Working Group PAHO Participating Countries 1. Ministry of Health 2. Social Security System 3. Global Fund Projects Collaborating Centers BDS, COHAN, ENSP Other Partners WHO (AMDS, MMSS) CF, MSH, GDF, Global Fund Works through Supports Works through

7. Pan American Health Organization 7 Subregional post Intl Caribbean WHO Collaborating Center SF Coordination Subregional MERCOSUR THS/EV RAVREDA Malaria Subregional THS/EV WHO CC Policies WHO/PAHO CC Supply Strategic Fund Operational Network Regional Office PAHO Tech / Admin Units, Procurement CA / Andean SF Consultant HIV/AIDS Sub-regional CAREC/HIV/AIDS Rational Use Strategic Fund Network Sites WHO/PAHO CC Supply

8. Pan American Health Organization 8 The Process 2005 - 2006 Revision of the Operational Framework Sub-Regional Workshops to initiate roll-out (Central America, Andean and Caribbean) National Workshops (interprogrammatic) to establish country operations Development of country work-programs based on priorities –Supply System Assessments (NIC, HON, ECU, GUT, DOR) –Procurement Planning (GUT, HAI, ECU, NIC, HON, BEL) –Capacity Building (Caribbean regional, BEL, ECU, TRT) Negotiations with Partners (COHAN, MSF, GDF) Linking with Global and Regional Prequalification and the Regional Network of QC Labs

9. Pan American Health Organization 9 Some Key Results 19 countries participating - 30% increase in 2 years 2 Social Security Agencies, and 4 PRs participating Positive Country Experiences: –Guatemala: Consolidation of demand MS, IGSS, PR –Ecuador: Resolution of key bottle-neck, facilitating GFATM disbursement –Haiti: Single Procurement Plan for all GFATM beneficiaries –Venezuela: Elimination of vertical PSM programs Clinton Foundation joint work in Barbados, Belize, Surinam, Ecuador and Honduras 2 Publications, Webpage ARV Price referencing with Regional Negotiations Consolidated procurement of anti Malarials for Andean countries Consolidated procurement malarial, PAMAFRO 2006-2007 Strategic partnerships, COHAN, `Clinton Foundation`, MSH. Publications, informative bulletins, developed Web page Capitalization account used for purchases of emergency procurement (Brazil (ARVs), Bolivia (TB))

10. Pan American Health Organization 10 Ecuador achieves Significant Reduction in Antiretroviral Prices 2007` Lower Price Referential 2006 Higher Price Referential 2006 Price Ecuador 2006 Price Ecuador 2007 AZT + 3TC + Nevirapina221.19 (Belize)751.90 (El Salvador)- 178.80 AZT + 3TC + Indinavir752.75 (Guatemala)1,909.68 (El Salvador)- 1156.00 AZT + 3TC + Efavirenz362.75 (Peru)1,417.05 (El Salvador)1,053.63 343.44 d4T + 3TC + Neviraprina 121.07/ 127.36* (Peru)1,881.94 (El Salvador)- 112.80 / 116.40* d4T + 3TC+ Efavirenz242.58 (Peru)2,598.80 (Ecuador)2,598.80 285.84 / 290.64* d4T + 3TC + Indinavir686.93 (Belize)3,039.72 (El Salvador)- 1099.2 / 1104.00 * d4T 40 + Ddi + Nevirapina316.71 (Peru)3,832.87 (El Salvador)- - AZT + 3TC + Abacavir761.45 (Peru)-- 742.20 AZT + 3TC + Lop/Rtv2,230.43 (Peru)5,637.43 (El Salvador)4,426.23 2347.80 D4T+ 3TC +Lop/Rtv2,110.26 (Peru)6,767.47 (El Salvador)5,971.40 2290.00 / 2295.00 Ddi+3TC+NVP338.05 (Peru)2,615.23 (El Salvador)- - AZT+3TC+Nelfinavir1,399.41 (Honduras)4,780.69 (El Salvador)3,512.92 2131.80 3TC+Didanosina+Lopinav ir/Ritonavir2,311.29 (Peru)7,500.75 (El Salvador)5,314.40 - Source : Agua Buona, February 2007

11. Pan American Health Organization 11 US$ Procurement Summary Strategic Fund Strategic Fund Indicator200420052006 2007 Value of products purchased $3,475,043$8,328,009$ 10,210,000 $ 19,690,000 Number of countries purchasing357 9 Forecast Procurement: 2006 (US$ 12 million), 2007 (US$ 20 million) Breakdown by Disease Area –HIV/AIDS (ARVs)82% –Malaria13% –TB 4% –Others 1 % Value Capitalization Account (established 2005) end: US$ 290,000

12. Pan American Health Organization 12 www.paho.org/StrategicFund Contacts: James Fitzgerald, Coordinator, Strategic Fund, PAHO Washington DC strategicfund@paho.org