Affordable Medicines Facility - malaria

3

Agenda

Background

Summary of Achievements to date–AMFm Technical Design–Ensuring that AMFm will work

Requested Board Action–Proposed Decision Points–Management of AMFm

Next steps

44

Rationale for the AMFm: to increase the availability of ACTs and substitute artemisinin monotherapies across all sectors

Chloroquine (CQ)

Sulfadoxine-Pyrimethamine (SP)

Artemisinin monotherapies

ACTs

Other

Chloroquine (CQ)

Sulfadoxine-Pyrimethamine (SP)

ACTs

Private Public

~400 ~150Total = ~550

0

20

40

60

80

100%

2006 Antimalarial Treatment Volumes (Million)

Note: Other category includes Mefloquine, Amodiaquine and others. ACT data based on WHO estimates and manufacturer interviews. Source: Biosynthetic Artemisinin Roll-Out Strategy, BCG/Institute for OneWorld Health, WHO, Dalberg.

55

ACT prices are relatively high and affordable to only few in the private sector - major barrier to usage

ACT Artemisininmonotherapies

Sulfadoxine-Pyrimethamine

(Generic)

Chloroquine (Generic)

8.0

6.5

0.5 0.30.0

2.0

4.0

6.0

8.0

10.0

Average Prices (USD)

Range(USD) 6-10 5-8 0.4-0.7 0.2-0.4

Note: Ranges indicate variance across countries and products excluding outliers; N (observations): (ACT, 222); (AMT, 227) ; (CQ, 37) ; (SP, 118).Source: Dalberg field research (Kenya, Uganda, BF, Cameroon), Observations by World Bank and Research International (Nigeria). Smaller pricing observations were also performed in Ghana, Rwanda, Burundi, Niger and Zambia), but due to low n not included. Sulfadoxine-Pyrimethamine and Chloroquine data complemented with HAI and IOM observations

66

Objective and design principles (endorsed by Board in May)

Objective: Increase overall use of ACTs

• Promote the use of ACTs and drive mono-therapies and ineffective drugs from the market by:

–Reducing end-user prices to an affordable level

–Introducing supporting interventions including those for proper use of ACTs

Objective: Increase overall use of ACTs

• Promote the use of ACTs and drive mono-therapies and ineffective drugs from the market by:

–Reducing end-user prices to an affordable level

–Introducing supporting interventions including those for proper use of ACTs

AMFm design principles

• Pricing & availability – to all sectors and countries

• Management – small secretariat

• Eligibility – standards for products, suppliers, buyers

• Importance of in-country supporting activities to ensure responsible introduction and use

• Monitoring & evaluation - linked to RBM Strategic Targets for 2015

AMFm design principles

• Pricing & availability – to all sectors and countries

• Management – small secretariat

• Eligibility – standards for products, suppliers, buyers

• Importance of in-country supporting activities to ensure responsible introduction and use

• Monitoring & evaluation - linked to RBM Strategic Targets for 2015

7

Agenda

Background

Summary of Achievements to date–AMFm Technical Design–Ensuring that AMFm will work

Requested Board Action–Proposed Decision Points–Management of AMFm

Next steps

88

The AMFm will offer ACTs to first-line buyers at a similar price range as CQ and SP through existing channels (illustrative)

AMFm

Medicines

Money

Information

Multiple eligible ACT Manufacturers

Private Buyers (e.g. National Wholesalers)

NGO Buyers(e.g. PSI, MSF)

Retailers, private clinics and public providers

Co-payment

Patients

DistributorsE.g. Central

medical stores

National distributors

Public Buyers(e.g. Ministry of

Health)

Supporting interventions

99

Impact of AMFm on prices at each level of the supply chain(illustrative example)

Manufacturers

Current

Private buyers Public buyers

Retailers / providers Public providers

Patients Patients

USD 4-5 USD 1

USD 5-6 Free / fee

USD 6-10 Free / fee

Manufacturers(MSP reduced to USD

1 for all buyers)

Future, with co-payment

Private buyers Public buyers

Retailers / providers Public providers

Patients Patients

USD 0.05 USD 0.05

USD 0.2-0.4 Free / fee

USD 0.2-0.5, for majority of patients

Free / fee

AMFm

USD 0.95

10

Ensuring that the AMFm will work

Examples of key issues

•Will the co-payment be passed through to the patient?

•Will it reach the poor?

•Will it increase resistance?

•Is it a subsidy for manufacturers?

•What is the opportunity cost?

•What is the cost-effectiveness?

•How will drug quality and safety be assured?

Examples of key issues

•Will the co-payment be passed through to the patient?

•Will it reach the poor?

•Will it increase resistance?

•Is it a subsidy for manufacturers?

•What is the opportunity cost?

•What is the cost-effectiveness?

•How will drug quality and safety be assured?

Approach

•Ex-ante analysis

•Piloting

•Eligibility criteria

•Supporting interventions

Approach

•Ex-ante analysis

•Piloting

•Eligibility criteria

•Supporting interventions

•Conceptual evolution from “Global ACT Subsidy” to AMFm

•Conceptual evolution from “Global ACT Subsidy” to AMFm

11

Illustration – will the co-payment passed through to the patient?

PilotingPiloting Supporting interventionsSupporting interventions

Eligibility criteriaEligibility criteriaEx-ante analysisEx-ante analysis

• Detailed analysis of existing markets for other essential medicines, e.g., low-cost antimalarials CQ, SP

• Research on the impact of Global Fund financed programs that are selling subsidized ACTs through private-sector pharmacies in Senegal (IRD)

• Introduction of subsidized ACTs in Tanzania (Clinton Foundation)

• Baseline research in Uganda (Medicines for Malaria Ventures)

• Buyer eligibility criteria

• Wholesaler incentives and pricing / price control mechanisms

• Public information

• M&E, operational research

12

Evolution from ”Global ACT Subsidy” to AMFm

CORE AMFm FUNCTIONS(Executed by Facility)

• Negotiation of terms for low-cost antimalarials • Processing co-payments for low-cost products

purchased by first line buyers• Setting prices and terms for international distribution• Transparent sharing of information and forecasts

ELIGIBILITY CRITERIA / REQUIREMENTS(Set by Facility)

PARTNER / SUPPORTING INTERVENTIONS(Monitored or coordinated by Facility)

• ACT treatment requirements• Buyer eligibility requirements• Country preparedness requirements

• National policy and regulatory preparedness

• Wholesaler incentives and pricing / margin control mechanisms

• Public education and awareness (IEC)

• Provider training• National monitoring and quality

preparedness (resistance monitoring, pharmacovigilance, and quality surveillance)

1313

Estimated impact and funding requirements

Year 1 Year 2 Year 3 Year 4 Year 5

264

287 282 289274

0

50

100

150

200

250

300

Global ACT Subsidy Funding (USD Million)

MedicinesandInternationalDistribution

Supportinginterventions

Org costs

AMFm Funding (USD Millions) Expected impact

•Reduce retail prices from current level of USD 6-10 to USD 0.20-0.50 for majority of patients

• Increase demand from current level of 100 million treatment courses per year to 360 million

•Shift most purchases away from ineffective medicines and possibly eliminate the market for artemisinin monotherapies

•Save 174,000-300,000 lives per year, in a fully-funded scenario

Expected impact

•Reduce retail prices from current level of USD 6-10 to USD 0.20-0.50 for majority of patients

• Increase demand from current level of 100 million treatment courses per year to 360 million

•Shift most purchases away from ineffective medicines and possibly eliminate the market for artemisinin monotherapies

•Save 174,000-300,000 lives per year, in a fully-funded scenario

14

Update on Tanzania’s Pilot ACT Subsidy Project

Roll Back Malaria Partnership 13th Board Meeting29 November 2007

15

Background and context

Results to date

Implications and Next Steps

Today’s presentation

16

The pilot project is being led by the Ministry of Health and Social Welfare and implemented by PSI – Tanzania and the Clinton Foundation

• Manage procurement of drugs and implementation of supporting interventions• Lead communication to global partners

• Lead partners: TFDA and NMCP• Manage relations with local government• Conduct dispenser training

• Implement in-country social marketing and repackaging• Build on lessons learned from ACT repackaging/subsidy

experiences in other countries

Tanzania Pilot ACT Subsidy

Project

17

The project aims to answer three key questions through a design which varies interventions across districts

Key questions:

1. What is the final price paid by patients for subsidized drugs?

2. What is the effect of a package of accompanying interventions (e.g., SRP, repackaging, social marketing) on end-user price and uptake?

3. What is the impact of the subsidy on the purchase and use of ACTs compared to other anti-malarials?

Kongwa

Shinyanga Rural

Maswa

Social

Marketing SRP

M&E

Explores effects of a subsidy without SRP

Explores effects of a subsidy with SRP

Serves as a control

Subsidy

OTC

StatusRepackag-ing

Supporting interventions

SRP ranges from US$0.25 to $1.00 based on dose

18

Wholesaler

Regional Distributor“Indirect”

Regional Distributor“Indirect”

Clinton Foundation

Drug Shops

DrugShops

ACTs procured at public sector

price

ACTs sold to wholesaler at 90% subsidy

Novartis

Kongwa DistrictMaswa District

Regional Stock Point

“Direct”

Regional Stock Point

“Direct”Shops pick up drugs

from distributorsTrucks/bikes deliver

direct to shopsTrucks/bikes deliver

direct to shops

Subsidized ACTs are distributed to retailers through two commonly used channels– via a regional distributor or directly to shops

19

Background and context

Results to date

Implications and next steps

Today’s presentation

20

There are inherent limitations to this study and caution should be taken in interpreting and applying its findings

• ACTs are being distributed only through – and data collected at – rural drug shops, which are an important source of malaria treatment in Tanzania, but are more formal and less pervasive than general stores.

• There is the potential for the Hawthorne effect (behavior is altered due to the knowledge of being studied) and social desirability bias. The study was designed to deliberately minimize these biases

Formal v. informal sector

Limitation Description

Potential study biases

• Initial data was collected one month after distribution of subsidized ACTs began. Experience has shown it takes time for a market to adjust to a new product

Preliminary data

• The study was designed to examine price and volume in drug shops. Some other important questions such as impact on total anti-malarial access in the district cannot be answered

• Study is conducted in 3 rural districts of Tanzania. Conditions vary widely across sub-Saharan Africa

Limited scope

21

Subsidized ACTs have quickly gained market share, appearing to displace sales of both SP and AQ for adults…

Products purchased in Kongwa and Maswa: August vs. November

% of adult exit interview customers purchasing anti-malarials

Other ACT + artemisinin monotherapy

SP

Amodiaquine (AQ)

QuinineOther

2% 2%

65%55%

25%

4%

3%

12%4%

1%

231100% = 323

August

(pre-subsidy)

November

26%

Subsidized ACT

22

… with higher uptake for children under 5 seeming to cause significant displacement of AQ

Products purchased in Kongwa and Maswa: August vs. November

% of exit interviews purchasing for an anti-malarial for a child under 5

SP

Amodiaquine (AQ)

QuinineOther

7%

47%

89%

2%2%

3%

44100% = 58

40% Subsidized ACT

10%

August

(pre-subsidy)

November

23

14% 14%

3%

79% 83%

7%

Under 5

5-15

Adult

608100% = 90

August

Exit

Interviews

November

ACT

Purchases

~ 2.1 million

2002 census adjusted by fever incidence

Intended recipient of exit interview purchases by age group

676*

November

Exit

Interviews* Includes purchases of ant-pyretics

While a greater proportion of subsidized ACTs were purchased for children, adults continue to be overrepresented compared to estimated

fever incidence

26%36%

23%

66%

41%

9%

Comparison of subsidized ACT purchases versus fever incidence by age group

24

Price paid for subsidized ACTs is in line with other commonly-available anti-malarials, with no variation in pricing behavior observed between

shops regardless of location

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

ACT Maswa ACT Kongwa SP AQ Art.Monotherapy

In the price intervention district, consumers paid exactly the SRP (~US$1)

Mean and standard deviation of price paid

% of adult exit interviews buying a full dose of an anti-malarial

US

Dol

lars

In both districts, 100% of customers paid the

same price

(only 3 observations)

25

$0.42 $0.42$0.50

$0.67

$1.00

$0.17

SP Subsidized

ACT

Subsidized

ACT

Subsidized ACT

AQ SP

Price paid for subsidized ACTs compared to most common alternative

Median price (US$)

Maswa Kongwa

Adult Child < 5 Adult*

Prices paid for subsidized ACTs compare favorably with common alternatives in Maswa, but the SRP appears to have inflated prices in

Kongwa

* Insufficient observations of AQ or alternatives for children under 5 to enable comparison

26

42 12 25

40

1

8

16

12

9

7

451

22

28

13

Among similarly-priced products, shopkeeper recommendation plays an important role in determining consumer choice

Subsidized ACT

Reasons for buying each drug

% of 443 exit interview customers buying anti-malarials

Any SP

Any AQ

Shopkeeper recommendation Prescribed

Previous use

Most effective Price

27

11%

4%

13%

41%47%

10%

29%

61%66%

23%

72%

23%

Consumers interviewed continue to be skewed towards the wealthier quintiles and wealthier individuals appear to buy subsidized ACTs more

often than others

Quintile 3

“Neither rich nor poor”

Socioeconomic status of consumers by district

% of customers buying anti-malarials or anti-pyretics

Quintiles 4 & 5

“Rich & Richest”

Maswa (n = 322)

Kongwa (n = 128)

Quintiles 1 & 2

“Poorest & Poor”

Shinyanga (n = 219)

Total (n = 670)

28

Background and context

Results to date

Implications and next steps

Today’s presentation

29

These preliminary findings highlight potential important lessons and areas for further exploration

• Continuing lack of consumers from lowest SES quintiles in private sector drugstores need to explore treatment-seeking of this group from other outlets

• Uptake of subsidized ACTs has been higher among children, but, in general, drug shops seem not to be the preferred access point for caregivers of children under 5 data and other studies indicate that they seem to be served by public/NGO health facilities

Socioeconomic status

Area Implication

Access for children U5

• The subsidy has been passed through to consumers, with retail prices generally at or below those for alternatives. The SRP can serve as an effective ceiling, but can perversely inflate prices

Pricing

• Stocking of subsidized ACTs by storeowners has occurred rapidly, though it has been lower in more remote areas

• It appears that the subsidized ACT is displacing AQ, and to some part SP

Uptake and displacement

30

While the pilot provides important information, we must move rapidly to large-scale implementation to increase access to ACTs

• Close to half of Tanzanians access malaria treatment through the private sector and are currently using inappropriate or ineffective treatments due to high price of ACTs

• A pilot has been launched in Tanzania to help determine how this challenge can be best addressed, including subsidizing ACTs and implementing supporting interventions

• Preliminary data suggests that the subsidy is being passed through to patients in rural areas and that uptake of subsidized ACTs by both consumers and retailers has been rapid

• However, low numbers of poorer individuals and children under five seeking treatment at the targeted drugstores is a potential cause for concern, and additional efforts to increase points of access for these groups should be explored

• Tanzania is firmly committed to expanding access to ACTs through all sectors and supports global and national initiatives to accomplish this goal

Providing a subsidized ACT through the private sector

Ministry of Health Uganda Medicines for Malaria Venture Pilot

Contents

• The pilot • Baseline findings• Next steps

MoH-MMV pilot to provide a subsidized ACT through private sector

SUDAN

TANZANIARWANDA

Kanungu

DEMOCRATIC REPUBLIC CONGO

Kisoro

Masindi

Nakasongola

Kasese

Hoima

Kibaale

Kiboga

Luwero

Apac

MukonoKAMPALA

Mubende

Kabarole

Nebbi

Arua

Gulu

Adjumani

Kabale

Mbarara

Rakai

Sembabule Masa

ka

Kalangala

Iganga

Busia

Mle

Tororo

Kapchor wa

Pallisa

Kumi

Katakwi

Moroto

Kotido

Kitgum

Soroti

Lira

Mpigi

Bushenyi

Rukungiri

Kamuli

Ntungamo

Moyo

KENYAKamwenge

Kyenjojo

Knga

Yumbe Pader

Sironko

Nakapiripirit

Kmaido

Bugiri

Mayuge

Wakiso

Jinja

Fort Portal

Bukedea

KiruhuraIbanda

Isingiro

Budaka

Butaleja

Nakaseke

Kaliro

= 6 Intervention districts

• Total population in study areas: 3 million• Different transmission settings (high / medium)• 6 intervention and 2 control districts • Baseline data in study district powered to test different interventions

= 2 control districts

Most children continue to be treated with ineffective drugs

(despite free Coartem at formal health facilities)

38,9

24,4

28,9

20,1

46,5

31,5

0

10

20

30

40

50

Kamuli (N=711) Pallisa (578) Soroti (545)

%

24 hrs from onset of fever 48 hrs from onset of fever

Proportion of under 5s, with fever in last 2 weeks, in rural areas who received

Any antimalarial: Less than 30% ACT: Less than 4%

3,2 3,8 3,55,5 6,6 5,1

0

10

20

30

40

50

Kamuli (N=711) Pallisa (N=578) Soroti (N=545)

%

Within 24 hours Within 48 hours

Source: MoH-MMV household surveys

Over 60% of people from the lowest economic quintiles get antimalarials from the

private sector

Source: MoH-MMV household surveys

Source of antimalarials for children under 5s by socio-economic quintiles

0% 20% 40% 60% 80% 100%

Lowest quintile (n=111)

Second quintile (n=165)

Middle quintile (n=89)

Fourth quintile (n=181)

Highest quintile (n=159) Govt healthfacilityCMD

Private disp./ clinicDrug shop

Pharmacy

Other

Only a quarter of all outlets provide ACTs largely due to the prohibitive price

Public sector

NGO

CDDPharmacy

Drug shops (licensed)

Priv. Disp

Stores (unlicensed)

Market

Outlets providing antimalarials in study districts

Source: MoH-MMV supply side survey

ACTs available but

frequent stock-outs

431 outlets identified in 3 districts using census approach in enumeration areas in 3 districts

Urgent need to close the private sector access gap

• Private sector is an integral part of the antimalarial landscape • Must engage to provide effective and affordable

treatment through outlets close to communities• Will complement public sector delivery

• AMFm provides the framework to address key constraints limiting access

Key elements of the pilot

• Finding innovative solutions for underserved areas• Aligning incentives with the existing supply chain to maximize

availability • Promoting a distinct product offering (repackaged Coartem)

with clear user instructions• Testing different approaches

– packaging, pricing, promotional intensity • Training to ensure correct dispensing

• Strong monitoring and evaluation

Launch 2Q 2008

MoH-MMV pilot is generating valuable data for AMFm

• Baseline data provided insight for AMFm design issues• Operational research will inform the roll-out of the AMFm on a

regular basis with emphasis on – ensuring correct dispensing and use of ACTs through the

private sector– uptake and impact of subsidized drug by socio-economic

groups – displacement of ineffective drugs– reaching underserved communities

Communities and patients need the AMFm

41

Agenda

Background

Summary of Achievements to date–AMFm Technical Design–Ensuring that AMFm will work

Requested Board Action–Proposed Decision Points–Management of AMFm

Next steps

42

Partners must address challenges from announcement to launch of AMFm

Five implementation challenges

Challenge 1. Ensuring quality assurance, pharmaco-vigilance, strengthening treatment practices (maximize points of access, diagnostics, mono-therapies), local manufacturing

Challenge 2. In-country supporting interventions, particularly around patient information, education, retail price setting, communication and country level monitoring

Challenge 3. Developing and agreeing a business plan for AMFm management

Challenge 4. Supplier sourcing and forecasting

Challenge 5. Resource mobilization

Five implementation challenges

Challenge 1. Ensuring quality assurance, pharmaco-vigilance, strengthening treatment practices (maximize points of access, diagnostics, mono-therapies), local manufacturing

Challenge 2. In-country supporting interventions, particularly around patient information, education, retail price setting, communication and country level monitoring

Challenge 3. Developing and agreeing a business plan for AMFm management

Challenge 4. Supplier sourcing and forecasting

Challenge 5. Resource mobilization

43

Proposed Terms of Reference for Reconfigured AMFm Task Force

MembershipMembership

Roles and Responsibilities Roles and Responsibilities

• Address outstanding questions from partners around each of the five implementation challenges

• Work with Global Fund as it performs its due diligence to develop a business plan for submission at the April Board meeting

• Develop work plans and identify resources needed to prepare for launch of AMFm

• Organize two consultations with endemic country civil society, private sector and government representatives (one in West Africa and one in East Africa, countries TBD)

• Representation: WHO, UNICEF, World Bank, Gates, Global Fund, UNITAID, CHAI MMV, Industry, Endemic Countries (2), UNF, NGO, bi-lateral

• Co-chairs: RBM Executive Director, DFID

Ways of WorkingWays of Working• Action-oriented with emphasis on timely deliverables of good quality

• Sub-groups will be formed to address specific issues; sub-group membership will not be confined to membership of the AMFm Task Force. Membership will depend on willingness and ability to make a clear contribution

• Role for RBM working groups on several issues, in particular key role for the Harmonization Working Group (needs assessment and planning for technical assistance) and the PSM Working Group (local manufacturing and forecasting)

TimelineTimeline• December 2007 – April 2008

• Review and update terms of reference after the Global Fund Board decision

4444

Proposed decision points

(1) Endorses the design of the AMFm as outlined in the executive summary of the technical design submitted by the AMFm Taskforce.  (2) Declares its support for the creation of an Affordable Medicines Facility for malaria (AMFm) to be implemented in accordance with the agreed technical design, noting that a launch is contingent upon resolution of five implementation challenges in the following areas: (i) pharmaceutical standards and treatment guidelines, (ii) supporting interventions, (iii) developing and agreeing a business plan for managing the AMFm, (iv) supplier sourcing and forecasting, (v) resource mobilization. (3) Invites the Global Fund to Fight AIDS, Tuberculosis and Malaria to consider taking on full responsibility as AMFm manager at its earliest convenience, for the implementation of this facility in accordance with the agreed design principles. (4) Expresses its gratitude to the co-chairs, secretariat, including advisers, members of the RBM AMFm Taskforce and other resource persons for having successfully achieved their mandate. (5) Decides to re-configure the AMFm Task Force to address the implementation challenges in a timely manner, in accordance with the terms of reference attached here.

(6) Encourages interested donors to hold consultations with the Task Force to secure financing for the AMFm.

(1) Endorses the design of the AMFm as outlined in the executive summary of the technical design submitted by the AMFm Taskforce.  (2) Declares its support for the creation of an Affordable Medicines Facility for malaria (AMFm) to be implemented in accordance with the agreed technical design, noting that a launch is contingent upon resolution of five implementation challenges in the following areas: (i) pharmaceutical standards and treatment guidelines, (ii) supporting interventions, (iii) developing and agreeing a business plan for managing the AMFm, (iv) supplier sourcing and forecasting, (v) resource mobilization. (3) Invites the Global Fund to Fight AIDS, Tuberculosis and Malaria to consider taking on full responsibility as AMFm manager at its earliest convenience, for the implementation of this facility in accordance with the agreed design principles. (4) Expresses its gratitude to the co-chairs, secretariat, including advisers, members of the RBM AMFm Taskforce and other resource persons for having successfully achieved their mandate. (5) Decides to re-configure the AMFm Task Force to address the implementation challenges in a timely manner, in accordance with the terms of reference attached here.

(6) Encourages interested donors to hold consultations with the Task Force to secure financing for the AMFm.

45

Agenda

Background

Summary of Achievements to date–AMFm Technical Design–Ensuring that AMFm will work

Questions & Answer session

Requested Board Action–Proposed Decision Points–Management of AMFm

Next steps

46

Next steps

• December 2007: First meeting of the AMFm Task Force to develop work plan

• April 2008: Expected acceptance by GFATM to take on the management of the AMFm

• December 2007: First meeting of the AMFm Task Force to develop work plan

• April 2008: Expected acceptance by GFATM to take on the management of the AMFm

47

BACK-UP

48

Some issues still require consensus – no pure technical answer

• Over-the-counter status

• Use of diagnostics

• Banning mono-therapies

• Drug quality standards

• Negotiation framework to set subsidy levels

• Over-the-counter status

• Use of diagnostics

• Banning mono-therapies

• Drug quality standards

• Negotiation framework to set subsidy levels