Procurement and Supply Management of Pharmaceuticals and other Health Products

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Procurement and Supply Management of
Pharmaceuticals and other Health Products

• November, 2006
• Dr Luca Li Bassi
• Procurement Operations Manager

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Topics of this Presentation

• Global Fund processFrom grant approval to
  implementation
• Procurement and Supply Management (PSM) plan
• Procurement Systems
• Quality Assurance
• Price Reporting Mechanism (PRM)

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• Global Fund processFrom grant approval to
  implementation
• Procurement and Supply Management (PSM) plan
• Procurement Systems
• Quality Assurance
• Price Reporting Mechanism (PRM)

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1- Global Fund Process From grant approval to
implementation
Global Fund approval disbursement
LFA conducts assessment
Implemen-tation
PR submits PSM Plan to Global Fund
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• Global Fund processFrom grant approval to
  implementation
• Procurement and Supply Management (PSM) plan
• Procurement Systems
• Quality Assurance
• Price Reporting Mechanism (PRM)

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2 - PSM Plan

• Objectives
• Outline how the PR will adhere to Global Fund
  procurement policies
• Measure performance during the 2 year
  implementation
• Include
• Indicate responsibilities along the supply chain
• List of key health products with quantities,
  costs, registration and patent status
• Details about technical assistance requested
• A Guide to Writing PSM plan and templates are
  available at
• www.theglobalfund.org/en/about/procurement/g
  uides/

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2 - PSM Plan Front Page
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2 - PSM Plan Key Components

• Describes PRs institutional capacity for PSM and
  elements of PSM cycle
• Use of existing data and systems
• Short concise approx 10 pages
• Development of PSM should be started early
  bottleneck for many PRs
• Include annexes with information on products to
  be procured (e.g., quantities, estimated prices,
  inclusion in WHO EDL, patent status etc.)

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• Global Fund processFrom grant approval to
  implementation
• Procurement and Supply Management (PSM) plan
• Procurement Systems
• Quality Assurance
• Price Reporting Mechanism (PRM)

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3 - Procurement Systems

• Adherence to interagency guideline on good
  pharmaceutical procurement (WHO 1999)
• Competitive bidding
• Transparent and accountable practices
• Appropriate quality assurance mechanism
• Assessment of PRs capacity to manage PSM by the
  Local Fund Agent (LFA)
• Manage all PSM activities
• Subcontract certain PSM activities
• Subcontract PSM activities to a procurement
  agencies

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3 - Procurement Systems

• Pharmaceutical product selection
• National or InstitutionalStandard Treatment
  Guidelines (STG)
• WHO STG
• National / WHO Essential medicines lists (EMLs)
• Sources of products
• Multi-Source Pharmaceutical Products
• Single and Limited-Source Pharmaceutical Products

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3 - Procurement Systems

• Source of products
• Multi-Source Pharmaceutical Products
• They are off patent products with publicly
  available quality assurance standards including,
  analytic methods and reference substances for the
  finished dosage form that is, for which there is
  monograph for finished dosage form publicly
  available in one or more Pharmacopoeias (e.g.,
  British Pharmacopoeia, United States
  Pharmacopoeia, International Pharmacopoeia and
  others).
• Multi-source pharmaceutical products are
  pharmaceutically equivalent products that may or
  may not be therapeutically equivalent.
  Multi-source pharmaceutical products that are
  therapeutically equivalent are interchangeable.
  Multi-source pharmaceutical products tend to be
  available from a wide range of manufacturers
  around the world.
• Single and Limited-Source Pharmaceutical Products

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3 - Procurement Systems

• Source of products
• Multi source pharmaceutical products
• Single and Limited-Source Pharmaceutical Products
• Single and limited-source pharmaceuticals are
  products for which there are no publicly
  available quality assurance standards, analytic
  methods, and reference substances that is, for
  which there are no publicly available monographs
  for the finished dosage form in the International
  Pharmacopoeia, the British Pharmacopoeia or the
  United States Pharmacopoeia.

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• Global Fund processFrom grant approval to
  implementation
• Procurement and Supply Management (PSM) plan
• Procurement Systems
• Quality Assurance
• Price Reporting Mechanism (PRM)

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4- Quality assurance

• QA for Multi-Source Pharmaceuticals
• Compliance with GMP and product quality standards
• Registered in the recipients country by the
  National Regulatory Authority
• Samples should randomly be subjected to quality
  control testing in order to monitor compliance
  with quality standard
• QA for Single and Limited-Source Pharmaceuticals
• During the 10th Board meeting in April 2005 the
  Board approved new and amended guidelines for the
  Policy on Quality Assurance for Single and
  Limited-Source Pharmaceuticals.

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Policy changes as of April 2005
Previous Policy
Current Policy
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Application
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Obligations
PR Shall promptly notify the global fund in
writing if it plans to procure any products
pursuant option Ci or Cii Shall obtain
documentation of the application and/or GMP
compliance Shall permit access to storage sites
and removal of samples
If products unavailable, PR informs Secretariat
and then
Has to procure from one of the (a) or (b)
suppliers
? 2 manufacturers of equivalent products
Number of Option (a) or (b) manufacturers
producing equivalent products
(i) The manufacturer has submitted an application
to the WHO or a stringent regulatory authority
and the manufacturing site is GMP compliant. IF
NOT, THEN (ii) Manufactured in a GMP-compliant
manufacturing facility
? 2 manufacturers of equivalent products
TGF Secretariat TGF shall contract an
independent 3rd party to conduct random quality
analysis of products procured pursuant option Ci
or Cii
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Conditions
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The Global Fund Compliance List
Development of a list of limited and single
source medicines found compliant with Global Fund
Policy on Quality Assurance (A,B,Ci,Cii
options). Objective providing countries with
information that will assist them in their
procurement options for limited and single source
medicines only. http//www.theglobalfund.org/en/ab
out/procurement/quality/
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• Global Fund processFrom grant approval to
  implementation
• Procurement and Supply Management (PSM) plan
• Procurement Systems
• Quality Assurance
• Price Reporting Mechanism (PRM)

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5 - Price Reporting Mechanism (PRM)

• The PRM keeps track of purchase information for
  medicine procured with funds received from the
  Fund. The system allows Principal Recipients to
  have full access to this information from their
  respective countries over the Internet.
• PRM allows the PRs to not only maintain secure
  records of its own procurement activity, but also
  to compare its activity to the activity of other
  PRs.
• The real-time information contained in the
  database will help the Secretariat keep track of
  procurement prices, supplier performance, product
  quality, and overall procurement efficiency of
  country operations.

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PRM Sample output
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PRM Regional Summary

• Countries situation
• Total number of countries expected to report in
  the PRM (i.e. with grants including
  pharmaceutical budget) 19
• Total number of countries that made entries so
  far in the PRM 16
• 9 countries reported for each grant received
• 7 countries reported for some but not all grants
  received
• 3 countries never reported procurement data on
  the PRM
• Grants evaluation
• Total number of grants in the Region 37
• 12 grants never reported data on the PRM

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PRM QA Compliance overview

• In order to monitor compliance it is paramount
  that purchases are reported in the Price
  Reporting Mechanism (PRM)
• In the period May 2005 - November 2006 a total of
  464 entries were made in the PRM by EECA
  Countries. Of these 464 entries, 257 were related
  to procurements of Single and Limited Source
  products
• 24 entries were related to procurement pursuant
  option C the Secretariat has not received any
  notification.
• Reminder
• It is a requirement for PRs to notify the GF
  Secretariat before procuring single and
  limited-source pharmaceuticals pursuant Option C

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Perspectives

• Continue supporting PRs on procurement practices,
  PSM plan and minimize delays in grant
  implementation
• Implementing the Quality Assurance policy
• Continue training PRs on Procurement policy
• Establishment of a PRM working group to review
  the system and explore improvements
• Establishing robust relations with technical
  partners (including WHO, FDA, NRAs)

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Procurement and Supply Management
http//www.theglobalfund.org/en/about/procurement/