Presentation on theme: "Differential Pricing UNFPA’s Experience With Contraceptives"— Presentation transcript:
1 Differential Pricing UNFPA’s Experience With Contraceptives Christian Saunders, Chief, Procurement Services
2 Every Minute in the World 380 women become pregnant190 of these women did not plan or do not wish the pregnancyEvery minute:380 women become pregnant, and 190 of them did not want the pregnancy at all or did not want it at this time.A safe and effective modern method of contraception could have prevented these 190 pregnancies.
3 Every Minute in the World 110 women experience a pregnancy-related complication40 women have an unsafe abortion1 woman dies from a pregnancy related causeEvery minute:110 women who are pregnant experience a complication of pregnancy; every minute 40 women undergo an unsafe abortion; and every minute one woman dies from a pregnancy related cause.Again, contraception could have prevented the recourse to abortion, and the availability of medical assistance including, for example, anti-biotic drugs and drugs for treating raised blood pressure in pregnancy could prevent much maternal mortality and morbidity.
4 Every Minute in the World 650 people are infected with a curable STIEvery minute:650 people are infected with a curable sexually transmitted disease (syphilis; gonorrhea; chlamidia; or trichomonas). Condom use could have prevented many of these infections, all of which require anti-biotics for their treatment.
5 Every Minute in the World 10 people are infected with HIVEvery minute:10 people, 9 of them in developing countries, become infected with HIV for which as yet there is no cure. The majority (7 or 8) of these infections are acquired through sexual transmission, and condom use could have prevented them.RH commodities are thus an essential element of any attempt to address the four main components of reproductive health: FP, maternal mortality and morbidity; RTIs and STDs; and HIV/AIDS.However, the availability of contraceptives, condoms for STD and HIV prevention, and other essential commodities for maternal health is not in itself sufficient to ensure their use. But their non-availability will certainly ensure their non-use.In 1994, at the International Conference on Population and Development (ICPD), the goal of universal access to reproductive health care by the year 2015 was established and agreed.
6 ICPD +5Governments should strive to ensure that by 2015 all primary health-care and family planning facilities are able to provide directly or through referral, the widest achievable range of safe and effective family planning and contraceptive methods; Essential obstetric care; Prevention and management of reproductive tract infections, including sexually transmitted diseases; And barrier methods, such as male and female condoms and microbicides if available, to prevent infection.Paragraph 53, ICPD +5
7 The United Nations Population Fund (UNFPA) Advancing universal access to reproductive health· Family planning and safe motherhood· Preventing sexually transmitted infections, including HIV/AIDS· Care for consequences of unsafe abortion· Eliminating harmful traditional practicesAdvocating informed, responsible and free choices· Women’s rights to health, education and freedom from violence· Sustainable developmentFormulating population strategy & policy· Partnerships with governments, NGOs, the private sector andUN agencies· Research on population issues
8 For every $1 million shortfall in contraceptive commodity assistance: Does Price matter?For every $1 million shortfall in contraceptive commodity assistance:Increase in the number of unintended pregnancies: 360,000Additional induced abortions: 150,000Additional maternal deaths: 800Additional infant deaths: 11,000Additional deaths of children under 5: 14,000
9 ProcurementUNFPA is the largest public sector purchaser of contraceptives. Also supplies commodities for social marketing programmes.Procurement undertaken by UNFPA is carried out through a fair & transparent process.UNFPA utilizes competitive bidding and direct negotiation in the case of proprietary products.Long term pricing agreements have been negotiated with many of the manufacturers.40% of UNFPA’s Procurement is on behalf of external clients
10 UNFPA vs. MARKET PRICE (US$) UNFPA US MARKET Condom (piece) 0.025 0.50 IUD (Unit)Injectable (dose)OCs (cycle)Spermicides (tablet)Implants (set)
11 Cost per year of coverage (US$) UNFPA US MARKETCondomIUDInjectableOCsSpermicidesImplantsSurgical (female)Surgical (male)
12 Possible Factors Affecting Price! VolumeProcurement ProcessMarket ShareImagePhilanthropy
14 Procurement Process Competition Experience Professionalism Quality Single clientUncomplicatedTransparentLong term partnership with strategic suppliersStandardizationForecasting allowing for planned productionFlexibilityGuaranteed PaymentProfessionalism in Procurement – Negotiation skillsFor example.Keep stocks on our behalf so majority of the time no need for urgent supply – plan productionLeakage – Not often a problem but we treat the issue seriously as we know that our ‘pricing ‘ depends on maintaining our relationship with the supplier and we work with the suppliers and the Government to resolve these issues.Clear parameters/instructionsSingle differential for pricing between developed and developingStandardized both in terms of the procurement process followed and in terms of the requirements E.G. packaging – so no investment needed. Standardized generic packaging also promotes competition and thus price reductionsNo compromise on quality or shelf lifeManufacturer.Inspected and certified by WHO.GMP, ISO certified (in last year).Certified by national authority.Facility licensed to produce particular product.General.Independent sampling by internationally recognized surveillance company (SGS, Inspectorate, Crown Agents).Quality control in a WHO recognized third country laboratory (with ‘condoms’ 100% batch testing).Commodity.Listed in British/American Pharmacopoeia.Certificate of analyses.Certificate of conformity.Authorized for sale in country of origin.Registered for use in country of final destination.Meets WHO specifications.At least 80% shelf life remaining.Markings, including date of man., Expiry and batch/lot nos.Instruction inserts in language choice.
22 Differential Pricing PROPRIETORY PRODUCTS ExampleProduct ‘X’(Oral Contraceptive Under Patent)UNFPA's price US$ 0.364/cycleUS Market price : US$ 34.00/cycleDifferent nameDifferent packagingDifferent product that essentially gives same resultsVolume of other products contributesMarket share
23 UNFPA - Future Action“Rapid population growth and high fertility hold back development and help to perpetuate poverty.”179 countries adopted the ICPD Programme of action in Cairo in Five years later, a review identified key areas for urgent action. .Contraceptives for couples wishing to space or limit families.Condoms, voluntary testing and counseling to reduce the spread of HIV/AIDS among young people.Availability of a wide range of safe and effective family planning methods.Births assisted by skilled attendants. Literacy for women and girls. School enrolment, especially for girls. .
24 The Future E-commerce Competition Group buying Standardization choice vs. securityWith IPPF/ USAID and UNFPA be more than 80% of all donated contraceptives