1. Global Fund New Developments Global Fund Reforms Transformation Funding Mechanism, Bridge Funding, 2 stage funding process,

2. Principle Results (2004-2011) GP/021209/9 0 Source: Global Fund Grant Data January 2012

3. Evolution of Funding (2002-2010) 2002-2013 $ US billion $3.4 billion contribute d 2002 - 20042005 - 2007 2008 - 20102011 - 2013 2 12 6 10 8 4 $11.7 billion pledged Annual disbursement Projected annual disbursement $6.2 billion contributed $9.4 billion contributed $3.4 billion contributed Number of signed grants 200 400 600 800 # of grants

4. Reforming The Global Fund Shift from emergency response to sustainability and fiduciary responsibility Status quo insufficient Maintain donor confidence All want better risk management ; safeguarding of resources; more efficient operations; value for money Donors are linking commitments to concrete results on reforms

5. Targeted funding opportunity to focus limited resources on critical protection of gains achieved in the fight against the three diseases as a transition to the new Strategy Overview TFM Proposal scope Eligibility Review and approval process In principle ECFP applies (e.g. Counterpart Financing, Targeted Pool, prioritization etc.) 2-year funding request Limited to continuation, and no scale-up Essential/critical services Request of relevant HSS support- only through embedding in disease proposals (no separate HSS component) NSA funding requests based on same scope Materials available 12 December 2011 Submission deadline 31 March 2012 TRP meeting during second quarter 2012 and intermediate Board endorsement Grant negotiation schedule determined by program needs/prioritization measures Rolling Board approval and grant start dates 2

6. 2011 20122013 2014 Global demand/gap assessment (work with countries) “New Funding Model/Opportunity” Funding Application & Review (including iteration) Development of the new funding model/opportunity as part of Strategy implementation Mid-term replenishment FundingApplication & Review “Transitional Funding Mechanism (TFM)” “The new strategy” Alternative to Round 11: “Transitional Funding” Access to new funding over time 1

7. Transformation Funding Mechanism Replace Round 11 with a new “Transitional Funding Mechanism” - to provide continuation of essential prevention, treatment and/or care services to existing grantees Process will involve a tailored application and an iterative review process to ensure high impact and strategic investments Develop new business model to enable funding from 2014, based on principles of the new GF 2012-2016 Strategy

8. Transitional Funding Mechanism The Global Fund Board decided to replace Round 11 with the Transitional Funding Mechanism due to inadequate resources –protect the gains achieved (e.g. interventions whose interruption would mean a significant rebound in transmission); and –save lives; and –are high impact, evidence-based, targeted to most appropriate populations and represent good value for money in a resource-constrained environment

9. Eg. Essential Services –HIV and AIDS antiretroviral therapy TB screening and treatment among PLWHA PMTCT Prevention and treatment targeted at key populations with high levels of incidence (including evidence-based programs reaching men who have sex with men, people who inject drugs, prisoners and sex workers) Male circumcision where indicated (i.e. in settings with high prevalence and low rates of male circumcision).

10. Eg Not Likely to be Funded in TFM scale up of antiretroviral therapy, untargeted population approaches to HIV prevention (including mass media campaigns), general population HIV testing in concentrated epidemics, generalized nutritional support, blood safety, universal precautions, pre-exposure prophylaxis, infrastructure development, procurement of vehicles, and generalized/untargeted trainings.

11. Review and approval process 2 TRP review to: Assess the technical merit in accordance with existing review criteria Determine whether applicants have demonstrated a risk of disruption of essential prevention, treatment and/or care services; and Assess whether the activities for which funding is sought cannot be funded by alternate sources of funding. 12 Dec 2011 When 31 Mar 2012 TRP review Appli- cation Revised guidance to applicants Endorsed by Board/SIIC and initial assessment of supply + demand June 2012 Grant negotiation Rolling Board Approval (finalize negotiation + grant signing) From Aug 2012/2013 on a rolling basis July 2012 Screening May 2012 More iterative clarification phase

12. Bridge Funding Mechanism implications 12 Policy areaChanges ScopeBridge Funding will continue existing program at the same scale “Essential treatment, prevention and care services” are not yet clearly defined and will be determined by the TRP Eligible GrantsGrants to expire between 31 December 2011 and 31 December 2012 If TFM funding becomes available prior to BFM end date, the bridge funding amount will be adjusted to avoid duplicative financing ReimbursementRelevant costs should be reimbursed if the corresponding request is approved If not, reduced from the existing cash balance of the PR Performance Based Funding Performance of the grant should be factored in deciding the funding amount of BFM Priority of FundingPriority of bridge funding is the same with that of TFM Lower priority than CoS, Renewals, and Round 10 funding needs 2

13. Phase 2 review process Phase 2 serves as a checkpoint to ensure that funding is performance- based and that programming is aligned with epidemiological evidence Board approves Proposals Global Fund and PR(s) sign Grant Agreement(s) PR(s) receives first disbursement; Program start date 1 Negotiate and sign extension to the Grant Agreement(s) by Month 27 27 Secretariat Phase 2 recommenda- tion to the Board 1 st day Month 24 CCM submits Request for Continued Funding Phase 2 disbursement 21 CCM invited to submit a Request for Continued Funding on the last day of Month 18 24 Program month PR implementation and reporting; CCM oversight; LFA verifications; Global Fund performance- based disbursements; partner support Board approval 10 th of Month 24 Phase 2 Renewal Process * End of months CCM can accelerate timing 182223 Phase 2 Panel meeting LFA Phase 2 Assess- ment Report due

14. Key modifications to renewals 2 ECFP 55% Rule Policy & Process G-20 UMIs no longer eligible for renewals unless have “extreme” disease burden Grants made ineligible will receive transition funding if renewal scheduled for 2012 Counterpart Financing and Focus of Proposal requirements apply Funding for LICs must be at least 55% of portfolio distribution in any given funding opportunity Review of composition and role of Grant Renewals Panel and involvement of TRP Revisit reprogramming policy and processes Revisit role of Country Team members and technical partners in developing CCM Request for Renewal Develop guidance for countries and CTs: defining an ‘iterative process’

15. Impact of ECFP on countries by income levels 15 Income Level Low Income Countries Lower-Low Income Countries Upper-Low Income Countries Upper-Middle Income Countries (non- G20) Upper-Middle Income Countries (G20) Disease Burden No Restrictions Extreme disease burden Focus of Renewal Not applicable 50% focus on special groups and/or interventions 100% focus on special groups and/or interventions Counterpart Financing 5% minimum threshold 20% minimum threshold 40% minimum threshold 60% minimum threshold Review + PBF adjustments Incremental Amount + Staggered Commitments Incremental Amount + Staggered Commitments Incremental Amount + Staggered Commitments Incremental Amount + Staggered Commitments Incremental Amount + Staggered Commitments 2

16. Challenges TFM/Bridge Funding Prioritizing country to support Reduced Resources in certain regions Tracking Co-financing Global fund fatigue—too complicate, OIG Evidence, value for money, Reprogramming

17. Opportunities Risk Management framework Iterative funding process –Regional proposals –Role of CS Country ownership consultation Research to build the case—CSS, VfM, NSP Development of Human Rights Framework Emergency Donor conf—MTR