BSP Contraceptive Initiative To broaden sustainable access to quality hormonal contraceptives through a new commercial venture Reproductive Health Supplies Coalition 14 th Membership Meeting, May 2010, Kampala Klaus Brill Bayer Schering Pharma AG

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 2 Need to Secure Supply of RH Commodities Increasing and unmet need for family planning products Increasing demand with ongoing population growth -Number of women of reproductive age increased and is expected to increase further: %, by %, by % -More than 200 million women still lack access to contraception -More than 1,7 billion people are under 15 years old in developing countries Sustain financial donor assistance dedicated specifically to family planning Securing reliable and sustainable supplies of RH commodities is a Public Health Priority Source: May 2010

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 3 Need to Secure Supply of RH Commodities Challenges of FP programs Better co-ordination of projects and information sharing of donors Definition of need and demand and respective planning of supplies Improve logistics systems and capacity at receiving end Shift of focus to HIV/AIDS Preventions projects Sustain funds for fully financed projects (“Public Sector“)

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 4 Access to RH Supplies as Human Right Right to access quality reproductive health supplies People in developing countries have the right for sustained access to an affordable range of choices of quality reproductive health supplies, in order to ensure better reproductive health for women and men To exercise this right it is necessary to: Increase the availability, predictability and sustainability of financing for RH supplies Strengthen the capacity of health systems to deliver RH supplies in a sustainable manner Ensure added value of the RHSC as a productive and sustainable global partnership through support for efficiency, advocacy and innovation Ensure corporate commitment for reliable and sustainable RH supplies Source: Reproductive Health Supplies Coalition: Reviewing the Strategic Plan, April 2007

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 5 R&D Manufacturers as Partners in FP Established suppliers for FP Programs Reliable partner for donor organizations for decades Sustainable supply of high-quality products -Established trust of consumer in products and services -WHO Prequalification as a certificate for high quality standard Value-added services -Pre-production, warehousing and delivery on demand -Support of educational programs for sexual and reproductive health -Network of local representatives to provide support Partner in a network of stakeholders in FP Programs Profound knowledge and experience in RH markets

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 6 BSP as Partner in securing RH commodities Commitment to serve public and social markets to ensure Access To Medicine (ATM) in less developed countries Offer users in the developing world a choice of sustainable, high- quality products at prices they can afford High quality level certified with WHO Prequalification -Microgynon, Microlut and Jadelle first and so far only RH products which got prequalified -Noristerat submitted for WHO Prequalification in Q Bayer Schering continues to provide the widest range of contraceptive choices at affordable prices and will expand it in future Commitment to Sustainability at BSP

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 7 BSP Contraceptive Initiative Background Growing gap between the demand for contraceptive products and the ability of donor funding to provide commodities -To keep pace with the rising demand, donor contributions would need to nearly double to satisfy unmet need by USAID and other international donors unable to meet demand. Social Marketing projects have been funded by donors to help increase access to contraceptives -Continued donor support required with projects not being sustainable Donors increasingly focus on “sustainability” -100% sustainable approaches must be 100% commercially self sufficient in the long term Source: May 2010

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 8 BSP Contraceptive Initiative BSP endorses the “2nd Tier Marketing” approach: Approach defined as introduction of a fully commercial brand at a price point above social marketing and public sector distribution, but below commercial prices in “1st Tier” Addressing this market segment is not just filling a gap but also tries to move clients who can pay more for their RH services to move to those commodities Objective Broaden sustainable access to quality hormonal contraceptives through a new commercial venture

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 9 Market segmentation is essential Assisted market interventions to move customers up the value chain POSITIVE High-price commercial sector Private market products Low-price commercial sector Affordable commercial products created through Public-Private Partnership Government/Donors Supply products free of charge or at minimum cost recovery Social Marketing Donor subsidized branded products 2 nd Tier 1 st Tier LIMITED Social Marketing Tier Free Distribution Tier BSP Contraceptive Initiative

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 10 Microgynon Fe as new “2nd Tier” product Benefit from BSP’s long-term market leadership position as well as commitment to sustainable developments Build on the strong brand Microgynon -The world’s leading low-dose oral contraceptive -Well-known and trusted by the medical profession as well as consumers throughout the world Market Microgynon Fe through commercial and private sector channels (pharmacies, NGOs, clinics, etc.). Microgynon Fe is projected to be 100% self-sufficient and 100% sustainable BSP Contraceptive Initiative

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 11 Phased approach Three project waves are planned Start with Ethiopia in 2010 which will serve as the first pilot market In total 11 Middle African countries shall be included Ongoing monitoring of sales, distribution and market success BSP Contraceptive Initiative

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 12 Global Development Alliance Contract between USAID and BSP signed in September First agreement of its kind -Clearly defined roles and responsibilities BSP is fully responsible for the implementation of the project -Supply chain, distribution, marketing & promotion, registration, quality USAID assists with funding for the first 5 years for advertising and promotional campaigns BSP Contraceptive Initiative

Reproductive Health Supplies Coalition, 14 th Membership Meeting, May 2010, Kampala  page 13 Our commitment BSP’s Family Planning activities are aimed at enabling self- determined family planning at affordable prices and reducing mother and child mortality BSP is supporting Family Planning programs in more than 130 countries with high quality contraceptives BSP Contraceptive Initiative