Procuring TB Medicines

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Procuring TB Medicines
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Unit Objectives

• Recognize characteristics of a good
  pharmaceutical procurement system
• Understand the importance of price comparison as
  an indicator of procurement efficiency
• Understand the conditions and procedures required
  by GDF and GLC for procuring TB medicines

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Unit Outline

• Goals of effective procurement
• Good Pharmaceutical Procurement Practice
• Sources of TB Medicines
• Procurement Methods
• Tendering
• Procurement from GDF and GLC
• Activity

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Pharmaceutical Management Cycle
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TB Supplies and Medicines to Procure

• Anti-bacterials
• Medicines used for adverse reactions
• Supplies for injectables such as syringes, IV
  administration sets
• Reagents/standards for laboratory tests
• Others

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Goals of Effective Procurement

• The correct medicines and supplies
• Meeting required quality standards
• In the correct quantities
• Delivered in a timely manner
• At the lowest possible purchase price

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Good Procurement Practices (1)

• Use generic name procure best quality product
• Limit to tuberculosis essential medicines list
• Purchase in Bulk
• Setup formal supplier qualification and
  monitoring
• Use competitive procurement methods
• Order quantities based on reliable estimate of
  actual need

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Good Procurement Practices (2)

• Manage finances, pay on time to avoid penalties
• Follow transparency procedures, good
  documentation
• Separate key functions
• Establish product quality assurance program
• Conduct annual audit, publish results
• Report regularly on performance
• Plan for procurement

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Procurement Methods (1)

• Open tender
• Restricted tender
• Competitive negotiation
• Direct procurement

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Procurement Methods (2)

• Competitive
• Open tendertender open to all bidders whether
  national or international
• Restricted tendertender open only to suppliers
  prequalified by the procurement department
• Competitive negotiationcontacting a few
  suppliers who are potentially interested
• Noncompetitive
• Direct procurementdirect purchasing from a
  single supplier at a quoted price

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Advantages of Competitive Procurement

• Minimizes costs, especially when using
  competitive practices
• Promotes high-quality products
• Manufacturer follows GMPs (raw material,
  manufacturing/packaging processes, quality
  controlall compliant with WHO guidelines)
• Ensures reliability
• All quantities ordered are received
• Deliveries are made within expected delivery
  period

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Disadvantages of Direct Procurement

• No competition for prices and services
• Increases unit costs (exceptions apply)
• Sole supplier increases risk of stock-outs
• Natural catastrophes affect manufacturing sites
• Raw material supplier unable to provide starting
  substances
• Supplier gets bigger or better order from another
  client

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When Is Direct Procurement Okay?

• When market forces fail and TB program lacks
  procurement skills
• Results
• low demand for medicines, therefore few
  suppliers, no competitive procurement higher
  prices
• Options
• pooled procurement by organizations like GDF and
  GLC

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Sources of TB Medicines

• Global Drug Facility (GDF)
• 1st line medicines at special prices
• Governments and organizations can buy since 2002
• Countries can apply to GDF for free grants
• Green Light Committee (GLC)
• 2nd line medicines at special prices
• International agencies
• UNICEF
• PAHO
• Nonprofit suppliers (IDA and others)
• Donors

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Donations--cautions

• Should be intended to assist the recipient
  country
• Should respect authorities and support existing
  government policies
• Should not be of lesser quality
• Should be preceded by effective communication
  between donor and recipient

SourceWHO Guidelines for Drug Donations
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Comparing Prices of GDF and Other Suppliersper
regimen

• To treat one Category I or III patient of medium
  weight (40-54 kg)
• GDF US 10.21 (CIF)
• Other suppliers US 30 - 50 (CIF)

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GDF prices vs. International and Kenya --per
medicine
RHZE
Price reductions--about 30 vs.
International--0-45 vs. Kenya
RH 150100
E400
Kenya GDF MSH Intl Price Guide
EH 400150
H300
Government of Kenya procurement before
GDF RHZE 15075400275 cost per
1,000 tablets
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Comparing Prices of GLC and Other Suppliers
Source Science vol. 293, August 2001
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Tendering for TB medicines
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Components of Tender Documents

• Invitation to bid
• General conditions of pending contract
• definitions, application, country of origin,
  patent rights, inspections and tests, packing,
  delivery, payment, price
• General technical specifications
• product quality and package specifications,
  product information, expiration date, recalls and
  disposal, labeling instructions, unique
  identifiers, qualifications of manufacturer

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Useful Documents

• Review Annex 3.1 Sample Supplier Registration
  Form
• Review Annex 3.2 Example of Standard Bidding
  Document and Annex 3.3 Standard Bidding
  Documents for Procuring Tuberculosis Drugs (MSH
  Template)

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Procuring medicines through the Global TB Drug
Facility (GDF) for 1st line medicines
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GDF

• Housed in WHO and managed by Stop TB partnership
  secretariat.
• Aims to supply quality assured, affordable drugs
  in a timely manner, for 10 million people with TB
  by 2005
• A bundled facility not a procurement agent

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GDFA Novel Approach to.

• Accelerate DOTS expansion
• Meet the following needs
• More resources for TB drugs
• High quality TB drugs
• Efficient procurement systems
• Standardized guidelines and products
• Monitoring of drug use
• Technical assistance in drug management

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What GDF Provides

• Grants of first line drugssupports DOTS
  expansion
• Direct procurement mechanismcountry buys drugs
• Web-based toolplace orders, track shipments
• Pre-qualified list of TB manufacturers
• Standardized products and user-friendly packaging
• Ongoing technical support, annual monitoring
  mission
• Support for in-country drug management
• Diagnostics and childrens dosages

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Procuring from GDF--benefits

• Competitive prices for TB products resulting in
  considerable savings.
• Strong quality control of TB drugs
• Variety of packages
• Loose and blisters, FDCs, patient kits,
  diagnostics, childrens dosages, AD syringes
• Services of experienced, reliable procurement
  agent
• Relatively rapid lead time for delivery of TB
  drugs

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Procuring from GDF-eligibility

• Countries routinely implementing DOTS in 90 or
  more of the population
• Organisations/agencies Donors committed to DOTS
  (as determined by the WHO DOTS Expansion Working
  Group of Stop TB)
• Potential, but not yet pre-qualified clients may
  be able to use a special Approval to Buy
  process
• More information at http//stoptb.unwebbuy.org/
  see visitor login

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Procuring medicines through the Green Light
Committee (GLC) for MDR-TB

• Statement
• The Who/Stop TB working group identified access
  to second-line medicines as a major obstacle in
  implementing DOTS-Plus projects

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Green Light Committee

• Technical panel of the Stop TB/WHO working group
  on DOTS-Plus for MDR-TB
• Members
• WHO, CDC, IUATLD, NTP Estonia and Latvia,
  Harvard Medical School, MCA
• Functions
• Reviews projects and advises WHO/DOTS-Plus on
  which projects should benefit from specially
  priced quality-assured medicines

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Green Light Committee

• Functions (continued)
• Arranges technical assistance through the GLC
  technical panel to TB programs wanting to
  establish a DOTS-Plus project
• Monitors approved projects, providing for
  technical assistance as needed
• Collects global evidence for developing policy in
  controlling MDR-TB

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GLC Secretariat

• Located in the Stop TB department at WHO
• Currently has two staff members
• Receives applications from TB programs wanting to
  implement a DOTS-Plus project
• Carries out recommendations after the GLC
  technical panel has reviewed the applications
• Performs procurement activities for second-line
  drugs through its procurement agent

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GLC Pre-application Phase (1)

• Before applying to the GLC, the potential
  DOTS-Plus project should
• Ensure that the DOTS strategy is in place and is
  functioning well
• Secure government commitment for long-term
  investment in staff and finances
• Develop a coordinated project management
  planwritten procedures
• Establish adequate laboratory services--with drug
  susceptibility testing (DST)

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GLC Pre-application Phase (2)

• Should (continued)
• Devise a rational treatment strategybased on DST
• Develop a specialized unit for managing MDR-TB
• Develop a functioning information management
  system
• Provide uninterrupted supply of quality medicines
• Confirm registration of medicines in the country
• Develop a port clearance plan when importing
  medicines

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GLC Application Phase (1)

• After the foundation of the program is in place,
  the applicant should
• Prepare and submit an application to the GLC
  according to Instructions for Applying to the
  Green Light Committee for Access to Second-Line
  Anti-Tuberculosis Drugs, WHO/CDS/TB/2001.286
• Respond to GLC comments, questions, requests for
  additional information or instructions resulting
  from the review of the application within the
  next three months

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GLC Application Phase (2)

• Facilitate a site visit, if requested by the GLC
• Agree to specific terms and conditions as
  outlined in the Letter of Agreement with WHO

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GLC Procurement

• GLC works with a procurement agent
• Current agent is IDA
• (International Dispensary Association)
• Not-for-profit company
• Agreement signed between WHO and IDA in 2001 for
  3 years extended 1 year
• IDA in charge of negotiation, procurement,
  quality assurance, and distribution
• Adds 7 margin on purchase prices

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GLC Quality Assurance

• IDA uses good distribution practices (WHO)
• IDA prequalifies manufacturers
• Assesses quality assurance system
• Audits the manufacturing plants
• Performs laboratory analysis on batch samples
• Sends information and documentation to facilitate
  registration of medicines in-country
• WHO/EDM is currently pre-qualifying future GLC
  manufacturers

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GLC Operational Process (1)

• DOTS-Plus country projects approved by the GLC
  sign a contract with WHO
• GLC secretariat introduces the approved project
  to the procurement agent by an official letter
• Approved country project sends confirmation of
  order and payment to GLC secretariat and
  procurement agent
• Medicines are delivered to the site designated by
  the DOTS-Plus country project

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GLC Operational Process (2)

• Takes four months from the time order is placed
  until delivered
• No medicines are kept in stock by procurement
  agent
• Manufacturers produce on demand
• Current manufacturers are located in India, U.S.
  and Europe
• Attention short shelf life for capreomycin,
  cycloserine and PAS

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Mechanism for Applying and Buying
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Operational Process (3)

• Technical assistance from members of the Working
  Group is provided to projects as needed
• Enrollment, treatment, and monitoring of patient
  cohort begins
• Periodic data and reports are sent to WHO
• Monitoring visits by GLC and consultants are
  conducted

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Summarizing MDR-TB Treatment

• Programs must follow recommendations to avoid
  development of resistance to 2nd-line TB
  medicines
• From a public health point of view, it is better
  not to launch a DOTS-Plus project if appropriate
  conditions are not in place, such as
• Ability to collect and analyze cohort data
• Combined default and transfer rates under 10
• Continual supply of 1st-line anti-TB medicines
• Application of DOTS in 90 of cases

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Advantages of a DOT-Plus Project

• Access to quality-assured and low-cost medicines
• Continuous supply of medicines
• Technical assistance throughout life of project
• External monitoring mechanism

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Current Status of DOTS-Plus Projects

• 34 projects have been approved by GLC technical
  review panel
• In EMRO and surrounding regions 1 each in
  Egypt, Tunisia, Jordan, Syria and 2 in Uzbekistan
  
• Other regions 7 in Russia 3 in Peru 2 in
  Honduras, 1 each in Estonia, Latvia, Kirghisie,
  Malawi, Philippines, Nepal, Moldova, Romania,
  Haiti, Mexico, Bolivia, Costa Rica, Nicaragua,
  Salvador, Ecuador, Dominican Republic

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Comparing Suppliers Bids
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Activity

• Compare TB medicine prices from your country
• With those of international sources
• With those of other participants
• Complete the form, Assessment of Procurement
  Practices in your country
• Discuss
• Do medicines need to be registered in your
  country before purchase?
• Can your procurement unit buy directly from GDF
  or GLC without a tender?
• Can your country afford to pay before the
  products are delivered and received?