E-DRUG: HAI Statement on the Global Fund and medicines donations
----------------------------------------------------------------
[posted 17 july; rcvd 20 July; WB]
Mr. Tommy G. Thompson
Dr. Richard Feachem
Global Fund to Fight AIDS, TB and Malaria
Secretariat
53, Avenue Louis-Casa�
1216 Geveva-Cointrin, Switzerland
15 July 2003
Dear Mr. Thompson and Dr. Feachem:
We are writing to you in advance of the upcoming International Meeting to
Support the Global Fund being held on 16 July in Paris, where we understand
that the issue of accepting in-kind donations of goods and services,
including medicines, will be discussed.
Health Action International (HAI) partners have had a long experience with
the many problems with medicines donations. Based on this experience and
expertise, we would ask the Global Fund board to decide that the donations
of medicines should not be pursued by the fund directly nor through third
party administrative mechanisms. Nor should medicines donations be
sanctioned at country level as a means for implementing Fund-financed
treatment programmes.
The treatment needs being addressed by the Global Fund require long-term,
sustainable, equitable and cost-effective solutions. Medicines donations,
however appealing they may seem at first glance, offer none of these
advantages.
The idea put forward at the June meeting of the Portfolio Management and
Procurement Committee and Resource Mobilisation Committee is that donations,
presumed to be free, would allow those �savings� to be used elsewhere in a
project.
The problem is that donations are not free. In fact, studies have shown
that donations actually are more costly to donor countries (because of tax
breaks given the donating company) and to recipient countries that bear the
higher administrative and other transaction costs of implementing a separate
donations programme. And restrictions often required by companies add
unnecessary hurdles for recipient countries. For example, companies
restrict where the medicine can be used, limit treatment indications, time
and quantity and add reporting requirements that further diminish the value
of the donation and drive up actual costs.1
Providing �free� medicines destroys the market needed to nurture
market-based solutions. Donations are driven by company interests.
Procurement based on Fund principles of lowest cost and good quality will
reflect the interests of the people in need of treatment. And given the
sheer scale of medicines required, no donation programme could provide the
quantities required, nor be sustainable over time.
Currently, one of the most cost-effective ways to access affordable
essential medicines is by buying generics. The significant size of Global
Fund support provides an invaluable and essential impetus for promoting
competition among generic producers, particularly those in developing
countries. With these economies of scale and the fact that marketing
expenses are not incurred, generic prices will drop further.
Therefore, it is imperative that the Global Fund continue to take decisions
that promote the use and the wide availability of high-quality, lower priced
generic medicines. The money saved from procuring them would be real and
those savings could be allocated elsewhere.
The international meeting on 16 July rightfully should be focussing on how
all sectors, public and private, can make urgently needed contributions to
our collective global challenge to fight HIV/AIDS, TB and malaria
effectively and quickly. Based on the longstanding and clear evidence,
medicines donations are not the way to go within the Global Fund�globally or
at country level. In the short term, systematic equitable pricing is
preferable. And the longer term goal and efforts should be to increase the
availability of generics and promote price competition as a means of making
medicines more affordable.
Thank you in advance for your serious consideration of our position.
Sincerely yours,
Ms. Beryl Leach
Health Action International
Global Fund Board Members
1 Guilloux, A. and S. Moon. �Hidden Price Tags: Disease-Specific Drug
Donations: Costs and Alternatives,� M�decins Sans Fronti�res, Drugs for
Neglected Diseases working Group. (MSF: Geneva. February 2001)
WHO/EDM/PAR. �First-Year Experiences with the Interagency Guidelines for
Drug Donations�. (WHO: Geneva. 2001)
Health Action International (HAI) is a non-profit, growing, global network
of some 160 consumers, public interest NGOs, health care providers,
academics, media and individuals in more than 70 countries. HAI promotes
increased access to essential medicines, the essential medicines concept and
the rational use of medicines. HAI has regional network coordinating
offices in Amsterdam (HAI Europe and North America), Colombo (HAI
Asia/Pacific), Lima (HAI Latin America) and Nairobi (HAI Africa).
Beryl Leach
HAI Africa coordinator
Health Action International (HAI) Africa
Regional Coordinating Office
PO Box 73860
Nairobi, Kenya
Tel: (254) 2 444.4835
Fax: (254) 2 444.1090
Direct: (254) 2 444.1090
Email: haiafrica@africaonline.co.ke
Website: www.haiweb.org
--
To send a message to E-Drug, write to: e-drug@healthnet.org
To subscribe or unsubscribe, write to: majordomo@healthnet.org
in the body of the message type: subscribe e-drug OR unsubscribe e-drug
To contact a person, send a message to: e-drug-help@healthnet.org
Information and archives: http://www.essentialdrugs.org/edrug