1. Access to and Management of 2 nd Line Drugs Challenges Summarized at 6 th Meeting, STB Working Group of MDR-TB 20-22 September 2007 - Tbilisi

2. 2 Summary 1.Severe shortage of 2 nd line medicines 2.Separate Roles of Key Actors 3.Core Problems 4.Recommendations

3. 3 Rationale There is a severe imbalance in the supply-demand dynamics for second-line line anti-TB drugs. The scale of the imbalance, however, is unclear and the factors behind it vary from country-to-country. There is a global shortage of quality assured second-line TB drugs for patients in approved GLC programs. Country shortages often result from the global shortage. Shortages are also caused or amplified by: –registration restrictions and import barriers of governments, –poor forecasting and order placement by programs, –complicated, time-consuming financial transactions between partners and agents, and –delays in disbursements from donors and financing mechanisms.

4. 4 Implications Relevance of GLC at stake Reputation of GDF and role in second-line line drug procurement at risk Global Fund funding for important GLC- approved programs at risk High level negotiation with Global Fund on revised payment procedures required

5. 5 Roles of Key Actors Green Light Committee (GLC) – Responsible for reviewing, assisting, approving and monitoring and evaluating MDR-TB management programmes; approval allows release of Global Fund and UNITAID monies for purchase of second-line drugs; the GLC is not responsible for drug procurement. Global Drug Facility (GDF) – Responsible for providing drug forecasts to procurement agents and suppliers; contracting procurement agents (IDA); ensuring, via contracted agents/suppliers, delivery of drugs to GLC-approved programs; ensuring the high quality of drugs supplied. The World Health Organization (WHO) – Department for Essential Drugs and Medicines Policy (EDM) – Responsible for pre-qualification of suppliers and products to ensure that products meet international standards of quality before they are procured. GLC approved programs and governments – Responsible for planning patient enrolment and treatment; forecasting drug needs; communicating forecasts and delivery schedules to IDA; coordinating with financing mechanisms to ensure payment in advance of supply; facilitating timely registration and importation of drugs; properly managing drugs received. Donors and financing mechanisms (governmental and non-governmental) – Responsible for approving and overseeing expenditures; releasing funds upon demand; advocating with other key actors to eliminate bottlenecks to ensure the greatest possible impact. Manufacturers of finished products and APIs: Receipt of orders for drugs; timely delivery at reasonable prices.

6. 6 Core Problems 1. Opaque Market 2. Short-term paralysis in the flow of second line drugs 3. Barriers, Costs of Entry & Uncertain Returns for Industry

7. 7 1. Opaque Market Administrative barriers and costs of entry, uncertain returns for suppliers; Delays in placement, payment or receipt of orders; No accurate, reliable quantification of current global demand; No process for short- and longer-term forecasting; Inability to estimate the timing and reliability of demand by individual recipients (programs and governments); No strong player to assure rapid payment and assume risk e.g. for advance purchase commitments.

8. 8 Recommendations of Stop TB Working Group on MDR-TB Immediately form an ad hoc task force to document the current supply-demand imbalance, including an assessment of available funding, and prepare 2- and 5- year forecasts. Clarify budget needs to create a transparent, well-defined, regularly updated source of market information.

9. 9 2. Short-term paralysis in flow of 2nd line drugs Demands for high quality second-line drugs currently outstrips capacity; Sub-optimal logistics, communications and response-time between key actors has exacerbated supply shortages; Lack of firm demand forecasts and sporadic order placement means irregular manufacturing stream; Inadequate GLC-approved supply impacts disbursements and overall programme performance.

10. 10 Recommendations of Stop TB Working Group on MDR-TB Establish and successfully manage UNITAID-funded buffer stock (constituting a supply of 800 patient treatments for 6 months). Based on demonstrated success; –pursue increased buffer stock size, when deemed effective. Immediately prepare and negotiate firm orders with current suppliers of drugs in tightest supply. Work with large financing mechanisms (Global Fund and UNITAID) to achieve flexibility on payment mechanisms; –pursue underwriting advance purchase commitments to eliminate financial transactions as a bottleneck. Evaluate overall procurement model for second-line drugs to identify and address procedural deficiencies i.e.: –lack of tendering for second-line suppliers, –heavy reliance on non-contractual suppliers to meet country needs, –prioritizing low prices over constancy and predictability of supply, – limited engagement of GDF as an intermediary between procurement agents and programmes.

11. 11 3. Barriers, Costs of Entry & Uncertain Returns for Industry Technical requirements of production and high capital cost, scarcity of raw materials; Shelf-life risks; Expensive and slow pre-qualification and approval process; High costs of country registrations and import licenses; Registration used as to protect local industry More attractive, predictable, captive, domestic and international markets.

12. 12 Recommendations of Stop TB Working Group on MDR-TB Establish clear, reliable forecasts of demand – available to all. Ensure measurable commitment from WHO/EDM to proactively assist suppliers of second-line anti-TB drugs to attain prequalification status for their products. EDM, in close co-operation with GDF, should offer an 18-month window to encourage and expedite prequalification via a tiered approval process and identify ways to subsidize national and international suppliers willing to enter into the WHO prequalification process. Will require financial support for subsidies. Encourage countries to more actively facilitate registration and importation of quality-assured 2nd line drugs or, more drastically, waive registration requirements altogether for WHO prequalified suppliers. Generate advocacy for designation of new drugs for use in TB/MDR-TB.