Procurement and Supply Management PSM and Issues to be Considered During Global Fund Proposal Writin

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Procurement and Supply Management (PSM) and
Issues to be Considered During Global Fund
Proposal Writing

• R9 Mock TRP Meeting
• April 28-30, 2009, Nairobi, Kenya
• Celina Schocken, PSI
• Eric-Marie Dupuy, Consultant

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Why Pay Attention to Procurement and Supply
Management (PSM) Issues?

• An estimated 47 of Global Fund grants used for
  procurement of commodities (medicines, LLINs,
  RDTs and other associated items)
• Round 8 malaria proposals
• Over half of the total budget for the 28 malaria
  proposals used for procurement of health products
  and equipment-with a predominant focus on
  long-lasting insecticide treated net (LLIN)
  procurement
• Global Fund is not engaged in direct procurement
  activities
• Role is to provide assistance to countries with
  policy requirements when procuring products with
  Global Fund resources
• Voluntary Pooled Procurement (VPP)

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Responsibility of PSM

• Principal Recipients (PRs) and NMCPs are
  responsible for ensuring that all PSM activities
  under its grant (including that conducted by
  other sub-recipients and entities) conforms to
  Global Fund requirements
• PRs are required to have systems in place to
  monitor the performance of other actors
  conducting procurement or supply management under
  he program

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Examples of TRP Comments and Identified
Weaknesses on PSM Portion of proposals in R7 and
R8
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PSM comments

• The large budgets associated with some of these
  proposals are driven by commodities.
• Over half the total cumulative upper ceiling
  budget for the 28 malaria proposals recommended
  for funding will be used for health products and
  equipment, with a predominant focus being the
  purchase of long-lasting insecticide treated
  bednets.

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PSM Weaknesses

• How will sustained coverage occur and how will
  scale-up be done
• The current capacity for PSM was not included
• Additionality to previous grants was not
  described
• Activities not linked to objectives
• Inconsistencies in proposals
• How, where, by whom will activities be
  implemented?
• Role of partners and donors
• How will poor quality products be handled?
• No supporting evidence on estimation of fever
  episodes
• Procurement system not adequately described
• Proposal states that private sector will be
  engaged, but it is unclear how

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General and Procurement and Supply Chain
Management Considerations for Proposals
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Principal Recipients Institutional Capacity and
PSM Cycle
Source GF guide to writing PSM Plan
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General Considerations

• For all steps in the PSM cycle plan for and
  include
• Who
• What
• Where
• When
• How
• State roles and responsibilities at each stage
• Multiple PRs Who does what?
• Coordination
• Be clear about PR capacity and gaps and steps
  taken to address these (capacity building,
  partner support)
• Note PSM activities are interrelated and may not
  occur in a straight timeline

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General Considerations

• Develop realistic and appropriate targets
• Ensure all milestones and targets aligned with
  PSM activities and fund disbursement
• Consider and Include (adequate) budgets for
• Technical assistance
• Systems strengthening
• Supply chain management (transport/distribution/re
  distribution)

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Product Selection and Regulation

• Ensure adherence to procurement laws and any
  other laws pertaining to PSM
• Consider requirements for medicines, RDT,
  insecticide registration
• Consider national medicine lists (EDL/EML)
• Consider prescribing and dispensing restrictions
• Ensure country regulation applies to all products
  (not just those procured with Global fund
  resources)
• Consider WHOPES registration for LLINs

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Quantification

• Must be coherent with budget and Attachment B
• Involve appropriate stakeholders in the process
• Determine overall country needs and illustrate
  that quantities in Global Fund proposal are a
  sub-set with other sources of funding covering
  other amounts
• Select appropriate method based on data available
• Clearly document all assumptions recognize the
  bottlenecks to policy implementation and show
  that they have been factored into implementation
  planning
• Use consistent units

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Quantification

• Consider reduction in transmission from scaled up
  prevention (LLINs, IRS)
• Remember Use of RDTs may reduce number of ACTs
  needed
• Note this exercise affects the targets and their
  achievement

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Procurement

• Consider supplier pre-qualification
• Voluntary Pooled Procurement and Procurement
  Agents
• Consider direct payment to suppliers to avoid
  losses for example, due to currency conversions
• Consider flexible delivery schedules for short
  expiry products
• Consider procurement lead time including
  timelines and budgets required port clearing,
  receipt, inland transportation, receiving and
  checking medicines
• Use generic nomenclature
• Refer to Global Fund Procurement Policy and
  Quality Assurance Policy

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Procurement Impact of Hidden Costs on Total Cost
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Distribution, Inventory Management, LMIS

• Clearly identify roles and responsibilities
• Clearly show that you are aware of inputs needed
  for appropriate functioning. State if this is
  being covered by other donor
• Indicate how coordination with other groups will
  occur (same commodity procured by different
  groups)
• Indicate current capacity and gaps
• For decentralized systems, how will lower level
  distribution occur?
• Describe distribution system
• LLINs-mass distribution or routine
• Consider lifetime and replacement of LLINs
• For LLIN replacement, how will this occur? What
  will happen to old nets?

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• Other background information on procurement is
  available at
• www.theglobalfund.org
• Including
• Voluntary Pooled Procurement
• Capacity Building Services / Supply Chain
  Management Assistance programs
• Global Fund Quality Assurance Policy (revised)

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Plan, Plan, Plan

• For each who, what, where, how and how much
• Identify and forsee challenges
• Plan to address them