NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Friday, December 12, 2014

The Global Fund to Fight AIDS, Tuberculosis and Malaria is putting into place a new agreement for purchasing HIV medication that will save close to US$100 million over two years, money that can be reinvested in lifesaving drugs and programs all over the world.

By using a Pooled Procurement Mechanism, the agreement means lower prices, swifter delivery and more predictable and sustainable long-term supply – delivering on the goals of the Global Fund’s Market Shaping Strategy.

It also yields greater transparency, reducing risks and expenses for countries that implement programs treating people with HIV. The new approach will also deliver better HIV medication options for children.

The improvements were achieved by bundling the purchase of, high volume drugs with lower volume ones which are sometimes more difficult to obtain. Negotiators also focused on improved shelf life and active pharmaceutical ingredient security.

The Global Fund is entering agreements with eight suppliers, with three of them as long-term strategic partnerships.