Procurement and Distribution of ARV Drugs and Related Commodities

The main focus of this activity is to support the quantification, supply planning, procurement and distribution

of ARV drugs for opportunistic infections (OI), sexually transmitted infections (STI), and other commodities

for HIV/AIDS programs. This will ensure sufficient supply and availability of these at service delivery points,

providing support to Prevention for Positives and other critical programs. Major support in the development

and implementation of national Pharmaceutical Logistics Master Plan (PLMP), which will provide a reliable

system for all health commodities, is another major focus.

Collaboration in commodity provision between the various partners is another major focus. This was

continued in FY07, with the Global Fund To Fight AIDS, Tuberculosis and Malaria (Global Fund) continuing

to provide funds for the supply of first-line adult ARVs. In FY07, an agreement was reached whereby supply

of pediatric first- and second-line ARV formulations and adult second-line formulations, previously provided

by PEPFAR, was transferred to the Clinton HIV/AIDS Initiative (CHAI). PEPFAR Ethiopia continues to

support ARV commodity procurement through contingency funding for a reserve stock of first-line adult ARV

drugs, and will also plan for emergency stocks of first-and second-line pediatric ARV, second-line adult

ARV, and rapid test kits (RTK), in case planned supplies from other donors are not available, as well as for

commodities used by other PEPFAR partners.

Commodities will be procured per Government of Ethiopia's (GOE) national ART and other program

protocols, and USG rules and regulations. PEPFAR funds the Partnership for Supply Chain

Management/Supply Chain Management Systems (PFSCM/SCMS).

Ethiopia's national target of universal access to ART and primary healthcare by 2010 has translated into a

rapid scale-up of ART service. The challenge presented under this scale-up is two-fold: 1) the need to

ensure systematic quantification, forecasting, and procurement planning so that adequate quantities of

commodities of appropriate quality are available; and 2) the need to have a reliable logistics system capable

of responding to the geographic and programmatic conditions of Ethiopia. The latter also includes the need

to consider the limited capacity of health facility stores to handle the volume of drugs needed for the

growing number of patients and to begin to ensure the development of a sustainable logistics system

aligned with the PLMP. SCMS is coordinating with diverse partners to support this effort, and is one of the

primary technical assistance (TA) providers for the Master Plan, including personnel support at both

national and regional levels, and planned support in improving regional warehouses.

In FY07, in conjunction with the Ministry of Health's HIV/AIDS Prevention and Control Office

(MOH/HAPCO), SCMS facilitated a National HIV/AIDS Commodity Quantification Exercise. The results

provided input into the Global Fund's Round 7 proposal and included requirements for ARV, RTK for

counseling and testing (CT), OI and STI drugs, male and female condoms, laboratory supplies, PMTCT,

and infection-prevention materials, as well as ready-to-use therapeutic food (RUTF). SCMS spearheaded

the exercise, using it to begin an open-ended supply-planning process. This will be institutionalized through

HAPCO's HIV Commodity Supply Management Committee, with technical support from SCMS and a

commodity security advisor seconded to HAPCO. The quantification and costing results, updated in June

2007, showed a total of $272 million needed to cover all HIV commodities for Calendar Year 2008, in

support of the MOH's Road Map II: Accelerated Access to HIV/AIDS Prevention, Care, and Treatment in

Ethiopia. This plan for universal access has a $159 million gap in funding to cover commodities for the

country, more than PEPFAR can cover in FY08. Prioritization of commodities will be important, as many

services cannot be effectively implemented without key products.

In FY07, SCMS provided support to the procurement process by developing quarterly forecasts of

requirements and updating supply plans. In FY07, SCMS procured drugs for the treatment of OI, infection-

prevention materials, and PMTCT supplies to address the continued shortage of these commodities—which

are key to the provision of quality services for PLWH and HIV-positive pregnant mothers.

In FY07, SCMS provided support for strengthening logistics systems. In FY08, in close collaboration with

MOH, HAPCO, and other partners, SCMS will continue to provide TA and support to PHARMID, the

national central medical stores, and the Ethiopian Health and Nutrition Research Institute (EHNRI) for

developing an integrated, logistics-management system for HIV/AIDS commodities. SCMS worked with

PHARMID to support the clearing, warehousing, and distribution planning of ARV drugs and related

commodities purchased by PEPFAR Ethiopia and other sources. SCMS began to play a major role in

procurement of commodities with Global Fund support, procuring approximately $8 million, mainly in RTK,

in FY07. Also in FY07, SCMS recruited and seconded ten logistics associates to regional PHARMID hubs,

and completed transitioning the distribution of commodities to sites from Rational Pharmaceutical

Management Plus (RPM+) to SCMS. In collaboration with RPM+, SCMS established a system for compiling

and transmitting facility-level patient and stock data to facilitate distribution planning as well as systematic

quantification and procurement. SCMS also provided support to central PHARMID to establish state-of-the-

art warehouse and distribution operations to manage HIV/AIDS commodities. Responding to emergency

shortages of commodities, SCMS collaborated with MOH and other partners to begin implementation of an

emergency, transitional inventory-control system for HIV commodities, to alleviate these problems until the

PLMP is fully implemented.

In FY08, SCMS will continue its efforts to strengthen the supply-chain management system for HIV/AIDS

commodities. Attention will be focused on support to regional PHARMID hubs in developing effective

warehouse and distribution operations, and integrating information and planning functions with the central

headquarters. Assuming a waiver for new construction can be obtained, SCMS will support PHARMID's

need to expand capacity to meet the growing demand, as well as the need for organizational development

to ensure sustainable institutionalization of logistics practices. SCMS will also support investment in

inventory control and warehouse management to support flexible and quality logistics operations. In

addition, SCMS will work in conjunction with the MOH's PLMP implementation to support development of

PHARMID's procurement capacity. In FY08, SCMS will make substantial investments in procurement and

logistics, with the aim of supporting national ART targets for numbers of patients, and hospital and health-

center sites providing ART services. In FY08, PEPFAR Ethiopia will procure up to $25,000,000 in HIV

commodities through SCMS, and will spend up to $14,000,000 to strengthen the capacity of PHARMID and

support PLMP implementation from national to site level. Capacity building may include substantial

provision of information-technology resources at appropriate sites, as well as support for adequate storage

space for commodities. Commodity procurement will be defined in conjunction with the MOH's HIV

Commodity Supply Management Committee, as the lack of funds to cover all commodity needs for universal

access goals requires prioritization to ensure optimum use of existing resources. The exact mix of

commodities to be procured will not be known until this analysis is complete, and will shift depending on

availability of funds from other sources, actual usage levels in MOH facilities, etc. To ensure sustainability,

SCMS will build the capacity of MOH and PHARMID staff through TA, training, and skills transfer to

effectively forecast, procure, and deliver essential commodities, and to collect, use, and share supply chain

information. SCMS will second staff at national and regional level to further those processes.This activity will

Activity Narrative: contribute to the upstream achievement of essentially all PEPFAR program indicators that depend on

commodities for success. This activity will ensure that health commodities for HIV programming, including

ARVs, are cost-effectively procured and effectively managed. HIV commodity requirements will be

appropriately quantified, projected, and costed. In-country systems for procurement, distribution and

monitoring of HIV commodity needs will be developed and supported.This activity is linked to other donor

and partner resources through an accountability matrix designed to coordinate the implementation of the

PLMP. Close integration with John Snow, Inc./DELIVER activities supported by USAID population funding

will be continued and strengthened. Partners include the Global Fund, the United Nations Children's Fund

(UNICEF), the United Nations Population Fund (UNFPA), the Global Alliance for Vaccines and

Immunization (GAVI), CHAI, and the World Health Organization. To ensure reliable and sustainable

logistics systems, PFSCM/SCMS will focus on building the capacity of PHARMID to carry out supply-chain

management functions.

Based on COP08 approval, SCMS levels under HTXD are restored to the original level by adding back in

the $13,686,592 that was put into unallocated. At the same time, there are a number of reductions that bring

the total amount of funding proposed to $38,724,200. These changes include moving 1) $622,972 from

SCMS to USAID M&S to account for the OE guidance from OGAC, 2) 960,000 from SCMS to cover the

HMIS support to the Federal Ministry of Health as a continuation of support offered in COP07, and finally 3)

$1,167,349 from SCMS to CDC to cover costs for Nastad.

Laboratory Reagents, Supplies, Equipment and Logistics Management

This is a continuing activity from FY07. In FY08, it is expected that the demand and cost of laboratory

monitoring will continue to increase. This is due both to the scale-up of Ethiopia's prevention, care, and

treatment (including ART) programs as it strives to reach universal access goals, as well as the PEPFAR

Ethiopia focus on increasing the quality of services in FY08. To meet the demand and provide quality

laboratory services to all sites, substantial investments will be necessary.

The main focus of this activity is to ensure that laboratory supplies procured by the USG and the

Government of Ethiopia (GOE) with Global Fund for AIDS, Tuberculosis and Malaria (Global Fund) and

PEPFAR monies are in sufficient supply, of superior quality, and are moving efficiently through a supply

chain that will support the scale-up of ART. The PEPFAR Partnership for Supply Chain

Management/Supply Chain Management Systems (PFSCM/SCMS) will procure laboratory supplies,

including reagents, consumables, and limited equipment, and develop the capacity of personnel at the

national, regional, and local levels to implement an efficient supply-chain management system for laboratory

commodities. These commodities, in conjunction with the supplies procured by the Ethiopian Ministry of

Health (MOH) and complemented by SCMS technical assistance in supply-chain management, will improve

the capacity of laboratories nationally to support ART services. SCMS will procure reagents at optimal

prices, and will collaborate with PHARMID, Ethiopia's public-sector, central medical store, on storage,

inventory, monitoring, and support distribution of reagents for CD4, hematology, and chemistry testing.

SCMS technical assistance and supplies procured with SCMS support will reach at least 131 hospital

networks, including national, regional, hospital, and health center laboratories throughout Ethiopia.

In FY07, SCMS supported the Ethiopian Health and Nutrition Research Institute (EHNRI), the national

reference laboratory, in designing and beginning implementation of a laboratory logistics-management

system. This work was carried out in close collaboration with PHARMID, as well as with the Management

Sciences for Health/Rational Pharmaceutical Management Plus (MSH/RPM+) team (ID 10534), the Clinton

HIV/AIDS Initiative (CHAI), and USG and other relevant partners. SCMS supported a senior laboratory

logistics advisor seconded to EHNRI and five regional laboratory associates (RLA) seconded to regional

laboratories. All activities were done in close collaboration with all relevant stakeholders, to ensure that the

laboratory logistics-management system functions smoothly. During FY07, SCMS worked with PHARMID to

strengthen its capacity to handle the special logistics needs for laboratory supplies, including cold chain

requirements, at the central and regional hubs. In FY08, SCMS will continue to support PHARMID in the

integration of cutting-edge logistics for lab commodities and distribution-management practices and

technologies in its standard logistics system.

In FY07, PEPFAR Ethiopia supported the national ART program by purchasing large quantities of

laboratory equipment and test reagents for diagnosis and treatment monitoring of HIV/AIDS patients. A total

of $9,403,323 million in lab monitoring supplies (CD4, hematology, and chemistry profiles) was procured

and distributed by SCMS. In addition, funds were allocated to support the expansion of the hospital

networks to cover 131 hospital networks (131 hospitals and 240 health centers); this included budgeting for

related equipment and semi-durable supplies and consumables. PEPFAR Ethiopia in FY08 has allocated

$9,500,000 to procure the following laboratory reagents, test kits and supplies through SCMS: (1) Chemistry

test reagents for monitoring patients on treatment: alanine aminotransferase/glutamate pyruvate

transaminase (ALT/GPT), creatinine, cholesterol, blood urea nitrogen (BUN), and glucose; (2) Hematology

test reagents for monitoring patients on treatment; (3) CD4 (cluster of differentiation-4) test reagents for

monitoring patients on ART treatment and pre-ART patients, including pregnant women; (4) Pregnancy test

kits; (5) Syphilis tests; (6) Deoxyribonucleic acid (DNA) polymerase chain reaction (PCR) test kits for

diagnosis of pediatric patients less than 18 months of age; (7) HIV rapid-test kits, as an emergency stock;

(8) Reagents and staining solutions of microscopic diagnosis of opportunistic infections (Acid-fast bacillus

smear, culture, and sensitivity, malaria, stool parasites); (9) Other supplies, including gloves, tubes, pipette

tips, and disinfectants.

SCMS will continue to support an integrated approach to procurement and distribution of laboratory

commodities in FY08, working with appropriate national, regional, and sub-regional counterparts and

partners. SCMS will work with laboratory and GOE stakeholders to support the implementation of the

national laboratory logistics systems, under the auspices of PHARMID and with technical input as

appropriate from EHNRI. SCMS will work closely to support the system for distribution of supplies direct to

testing and other service-delivery sites, in line with a national standardized system for supply-chain

management. Supportive supervision will be provided to ensure reporting through a robust, laboratory-

logistics management-information system (LMIS), which will be substantially strengthened. A system for

reporting and using the laboratory LMIS to support appropriate inventory control systems, proper

quantification, forecasting, and timely procurement, as well as responsive distribution of supplies, will be

developed. RLA will continue to contribute to capacity development at the site-level to carry out laboratory

LMIS functions, and to ensure sustainability of services. In these ways, SCMS will assist in strengthening of

the national and local supply-chain management system.

To ensure long-term sustainability of interventions, SCMS will assist in improving national capacity through

training and skills transfer to EHNRI, the Federal MOH, PHARMID and nongovernmental organization

(NGO) partner staff, and will ensure that the interventions are consistent with the vision and capacity of the

MOH and the Pharmaceutical Logistics Master Plan (PLMP). SCMS will continue to use training as an

important means of achieving the above objectives.

This activity will support a unified approach to procurement and distribution of laboratory commodities,

coordinating with its support for availability of other critical HIV/AIDS commodities to support the prevention,

care, and treatment program. Sustainable lab-commodity management systems will be developed through

integration into, and strengthening of, in-country systems for managing these commodities.

This activity is linked to other donor and partner resources to coordinate the implementation of a national

PLMP. Close integration with the SCMS and RPM+ ART drugs activities (ID 10532, ID 10534) as well as

other PEPFAR laboratory-support partners will be continued and strengthened. Other linkages include the

Global Fund, CHAI, and the World Health Organization (WHO).

PFSCM/SCMS will ensure consistent and timely delivery of laboratory commodities to public-sector sites

Activity Narrative: providing prevention, care, and treatment services to patients who need them throughout Ethiopia. PLWH

will be among the beneficiaries.

The primary emphasis of this activity will be to ensure robust logistics for lab commodities. Capacity of sites

and Ethiopian organizations such as PHARMID will be strengthened to ensure the sustainability of a

national supply-chain system for lab commodities. EHNRI's ability to provide the necessary technical input

to inform planning for the procurement of laboratory commodities will also be strengthened.

Based on COP08 approval SCMS levels are restored to $14,437,102 as originally submitted in COP08.