Options for the RHInterchange: An Integration Initiative Adding Value in the Reproductive Health Supply Chain At the request of the Reproductive Health Supplies Coalition, the Supply Initiative developed this brief to articulate the RHInterchange’s vision, stakeholders, and options for continuation after the current support through the Supply Initiative ends in December 2005. You have the Options Brief in your materials, hope you’ve had a chance to look at, Steering Committee members received it last week. This will just be a quick overview. RH Supplies Coalition Meeting, Seattle,18-19 May 2005

How the Coalition and Coalition members can endorse, strengthen, and improve the RHI: Support the provision of the right order and shipment data Support the need for program forecasts Promote the use of the RHI for more informed management of supplies Provide a forum to discuss the RHI’s future and ongoing operations, through a Coalition-sanctioned working group The RH Supplies Coalition was launched in 2004 to strive for coordinated global attention in support of headquarters-level and in-country actions to improve contraceptive availability. The existing partners in the RHI are supportive of its continuation. Now that the Coalition is operational, the Coalition may itself be the appropriate body to spur and monitor action to support the continued development and expanded use of the RHI to improve donor coordination and in-country supply chain management. Requested Action Coalition members endorse RHI value-added activities by agreeing to: Support the need for the right order and shipment data (IPPF, UNFPA, USAID, PSI can continue to actively provide up-to-date information; DFID, KfW, EU, World Bank can explore requesting that their procurement agents provide information). Support the need for program forecasts (all funders of contraceptives can allocate resources to fund forecast exercises as an integral part of contraceptive supply; all RHI participants can adopt consistent approach to forecasting). Promote the use of the RHI for more informed management of supplies (IPPF, UNFPA, USAID, PSI can promote internally to staff at headquarters and in-country; IPPF, UNFPA, USAID, PSI, World Bank, EU, DFID, KfW can promote and support use by funded recipients). Provide a forum to discuss the RHI’s future and ongoing operations, through a Coalition-sanctioned working group.

Options for the RHI‘s Future Stakeholder participation in planning for the future (June) Financing Expansion Enhancement We are currently in Phase I of the RHI. The system is in the late stages of development. It has been programmed and is in early use by the three initial providers of data. This establishment phase was originally planned to be completed by July 2005, and was to have included at least one full year of monitoring routine operations with complete data. However, due to the delays in securing UNFPA data, that year-plus of monitored use is just beginning now, Spring 2005. The current participants at UNPFA, IPPF, USAID, JSI, and the other partners in the Supply Initiative have all indicated that they believe the RHI should continue. However, it is not yet ready to be a self-financing undertaking, if indeed that will ever be the case. The next phase of the RHI needs to comprise that year of monitored utilization, and will require external support from one or more donors. Stakeholders in the RHI have stated they are committed to carrying forward its activities. After the RH Supplies Coalition meeting in May 2005, the Supply Initiative will convene a meeting of current and potential RHI participants and funders - - hopefully in June - - to discuss how to secure future funding for the RHI after the initial funding period ends at the end of the calendar year. The following points are important to note:

Financing the RHI External support required for transition phase of 2-3 years One or more donors User fees or member fees an ultimate objective “Location” of RHI during interim phase Funding Options RHI funding for the next phase will require support for ongoing operations at less than $300,000 per year. This figure does not include expansion of the RHI development process and costs that may be incurred by users and data sources. There has been discussion of user fees or member fees as a possible sustainability plan. So far, given that the RHI has not had the time needed to prove its full value, full financial support by user fees or member fees is not likely to be feasible. Finally, some stakeholders have discussed whether it makes sense at this time to transfer the RHI officially into a single organization. Given the difficulties in gaining acceptance and overcoming many barriers to use, the community of stakeholders should discuss concerns that placing the RHI under one donor’s or agency’s aegis could lead to conflicts of interest, burdensome political or bureaucratic constraints, or pressures to pursue a particular agenda. Building upon consultations with current and potential RHI stakeholders, proposals for the future of the RHInterchange will be submitted to funding organizations in the summer of 2005. A Return on Investment Ongoing maintenance costs of the RHI are less than 0.3% of the total value of commodities contained in the RHI. To put that figure in perspective, potential cost savings provide ample reason to invest in the RHI. Here is a real-life example: One funder of contraceptive supplies experienced an increased cost of over $300,000 in shipping costs alone in order to minimize supply chain disruptions due to a manufacturer delay in production of a single method.  A coordinating body using the RHI could anticipate such delays and bridge the gap by sharing commodities supplied by different donors. In this way, these additional costs can be avoided, funding can be used to supply more commodities, and most importantly, field programs can benefit by receiving the supplies they need.

Expanding the RHI IPPF, UNFPA, and USAID make up 58% all donations combined Include BMZ/KfW, DfID, and PSI; total rises to 85% Continue discussions with the World Bank as to how best to capture Bank-financed procurements of RH supplies. Expansion Options The next phase, proposed for a two-year period, could entail broadening the communications reach of the RHI to include other active donors/funders of contraceptives and their respective community of recipients and procurement agents. Specifically, this would include BMZ/KfW, DfID, and PSI; along with continued discussions with the World Bank as to how best to capture Bank-financed procurements of RH supplies. The three-year average between 2000 and 2002 for all donor-funded commodities is $191,921,000. Of this total, the combination of IPPF, UNFPA and USAID make up $111,490,300 – a 58% total of all donations combined. By including BMZ/KfW, DfID and PSI, the total comprises 85% of all donor-funded commodities

Enhancing the RHI Global metrics for RH supply chain management Procurement information resource Forecasting database Enhancement Options Additional options for the future of the RHI include those that would enhance its purpose and functionality. For instance, the RHI effort could be channeled toward: Developing global metrics on supply programs’ “customer service,” which donors can and will support; and modifying and reporting on these metrics to Coalition members. Issue: Organizational incentives, cultures, and policies may inhibit collaboration in the RHI and hamper effective customer service. Addressing this requires not only agreed-upon metrics, but a component of change management or organizational development to enhance customer service within supplying organizations. Serving as an information resource for procurement, to include information useful to program managers about donor programs, suppliers, procurement agents, prequalification criteria, product specifications, indicator prices, quality assurance resources, etc. This could be particularly useful for recipients switching to new donors, purchasers spending local funds, procurement managers using World Bank funding, managers of basket funding, and decision makers at Ministries of Finance or budget offices. Issue: Inefficiencies in donors’ and governments’ own procurement policies, compounded by lack of information, dilute the impact of donor assistance and the efficient allocation of resources. Recipients of funding, especially those new to procurement and donor regulations, spend unnecessary time and administrative effort seeking information and technical support to conduct donor- or government-compliant tenders. Completing the forecasting aspect of the database, which could not be completed during the first phase. This module would help programs, donors, and funders identify gaps in funded commitments for product, rendering the RHI much more useful for countries’ inbound supply chain management.

Recommendation: The Coalition and Coalition members can and should endorse, strengthen, and improve the RHI. I’d like to just end on the same note we began on - - this is the “We need you!” message, or recommendation. If the Coalition and Coalition members indeed find the RHI useful, and to be a resource to support and improve their work and the work of their country counterparts, then we seek active Coalition endorsement and “ownership” of the Interchange. And we invite participation of relevant organizations in the process of nailing down the options for the RHI’s future in the weeks ahead.

Visit the RHInterchange at rhi.rhsupplies.org Thank you. Visit the RHInterchange at rhi.rhsupplies.org Thanks for your attention. We’d love to hear your feedback. And of course, please be sure to visit and use the RHI online at this URL!