Réseau Pharmaceutique Œcuménique (EPN)

A Statement of the Ecumenical Pharmaceutical Network (EPN) on the US President’s Emergency Plan for AIDS Relief (PEPFAR) Supply Chain Management System

Tuebingen, Germany, May 2006

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The Ecumenical Pharmaceutical Network (EPN), comprising Christian Health Associations and hospitals, non-profit drug supply organisations and ecumenical agencies from 29 countries who attended EPN’s Annual Forum and General Meeting from 8th – 13th May 2006 in Tuebingen, Germany, issues this statement on the Supply Chain Management System (SCMS).

We recognise and acknowledge that scaling up medical assistance and care of the men, women and children in our communities who are infected and affected by HIV/AIDS require uninterrupted supply of high quality, low cost products that flow through an accountable system. Therefore, we welcome the intention of SCMS to strengthen existing or establish (where none exist) secure, reliable, cost-effective and sustainable supply chains that meet the care and treatment needs of the people living with and affected by HIV/AIDS.

1. We note that the SCMS was established 3 years after the launch of President Emergency program on AIDS Relief (PEPFAR). However, the number of patients on ARVs through PEPFAR had increased even before the launch of SCMS. This indicates that some well-functioning supply systems already exist. These should not be destabilized.
2. In the design of the SCMS, there has been little or no involvement of stakeholders from the countries targeted. There was therefore no opportunity to bring in country-specific issues.
3. The creation of such a large multi-country supply system will have a negative impact on the existing supply systems because of imbalance in the trading volumes. It is more than likely that manufacturers and suppliers shall give priority attention to this major client at the expense of the smaller existing clients. The plan of supplying more than 120 commodities will take up a large proportion of the Essential Drugs supply needs, rendering the existing supply organizations irrelevant.
4. There is no adequate assurance that in-country manufacturers and suppliers will be supported to ensure growth in capacity and sustainability.
5. Whereas the SCMS project proposes to supplement and strengthen the existing supply chain capacity and to collaborate closely with governments, non-governmental organizations and faith-based organizations to strengthen the public health systems, we see a danger of brain drain of human resources from the existing systems to the SCMS.
6. The SCMS project presents an alternative procurement system, which negates the principles of Sector Wide Approach Strategy (SWAps) of common management arrangements which include working through existing public procurement system.
7. While the objectives of SCMS may be beneficial to the needs of the people in short-term, there is a real danger in the long-term sustainability beyond the period of PEPFAR funding. There is no clear exit strategy to ensure that the capacity established will be sustained.
8. The suggestion of voluntary choice in the use of SCMS services for the PEPFAR recipients seems rather theoretical, since decisions will be made at US country missions and not by the recipients of the funds. We find it highly unlikely that a local PEPFAR funds sub- recipient would have the mandate to choose to procure products outside SCMS which is funded by US government.

Recommentations

In order for the SCMS project to succeed in delivering its objectives and to ensure that useful and sustainable capacity is established within the existing public health procurement systems, EPN makes the following recommendations for SCMS action:

1. An in-country mechanism and forum for continuous dialogue and communication should be established for key stakeholders to review country issues on the system design, identify collaborating stakeholders and provide monitoring feedback. This should include MOH, National AIDS Control Program, public andFBO/NGO Drug Supply Organizations, Pharmaceutical Societies, representatives of Pharmaceutical Manufacturers and PEPFAR awardees, and other donors such as Global Fund, World Bank –MAP programme etc.
2. There should be clarity in the strategies for addressing the two different situations: countries with in-country supply structures and those without such structures. In the countries with already existing systems, needs/gaps analyses should be the first step in strengthening the existing systems.
3. Capacity building should target strengthening of the existing Public and FBO/NGO Supply organizations and should be started before the supply activities are started. The capacity building should include recruitment of qualified staff, skills development in logistics (e.g. transport) and other supply chain management issues, contract negotiation, quality assurance and M&E. Capacity building should be a continuous exercise that focuses on use and strengthening of existing local experts.
4. The SCMS should ensure good knowledge and understanding of the country specific laws, policies and regulations to ensure integration or harmonization since this has a bearing on systems strengthening and sustainability.
5. Transparency and accountability should be enhanced through participatory M&E. The M&E plan should be clear to all stakeholders from the onset. There should be a strategy for in-country capacity building for M&E of the performance of the country SCMS activities and its impact on the other existing systems.
6. A clear exit strategy should be designed for each targeted country before the start of the project. This should clearly define the targets to be achieved during the project to ensure that after the end of the project the achievements will be sustained and no crisis situation will occur. This should also include management succession planning by including and developing capacities of local human resources.
7. The SCMS project must incorporate a comprehensive risk management strategy since the lives of many people will be dependent on its efficient and uninterrupted performance irrespective of environmental and political changes.

We, the members of EPN, in the spirit of goodwill and solidarity, further affirm that the fight against HIV/AIDS deserves concerted efforts. Efforts that bring out the best from all stakeholders to ensure sustainability, effective use of resources, expanded local capacity and the empowerment of people. In view of the above, we urge you to respect the reality on the ground, to give attention to the concerns expressed and to consider the recommendations as the SCMS prepares to implement its plan.

Thank you.

This statement has been signed on behalf of the Ecumenical Pharmaceutical Network (EPN).

Mr. Albert Petersen                     Dr Eva M A Ombaka

Chair, EPN Board                       Coordinator EPN