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Use of Generic Antiretroviral Drugs and Cost Savings in U.S. HIV Treatment Programs
July 19, 2010

aids 2010 logoJuly 18, 2010

Vienna, Austria, July 18, 2010 – A newly-released study in the July 21st issue of the Journal of the American Medical Association shows that the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR) saved an estimated $323,343,256 from 2005 to 2008 through the use of generic antiretroviral drugs (ARVs). This significant cost savings contributed to PEPFAR’s ability to dramatically improve access to antiretroviral therapy in sub-Saharan Africa and other regions. Through September 2009, PEPFAR directly supported treatment for more than 2.4 million adults and children.

Among PEPFAR-supported programs in 16 countries, availability of generic ARVs was associated with increased ARV procurement and substantial estimated cost savings. While ARV expenditures increased from $116.8 million in 2005 to $202.2 million in 2008, procurement increased from 6.2 million to 22.1 million monthly packs. The proportion spent on generic ARVs increased from 9.2% in 2005 to 76.4% in 2008, and the proportion of generic packs procured increased from 14.8% in 2005 to 89.3% in 2008. In 2008, there were 8 PEPFAR programs that procured at least 90.0% of ARV packs in generic form, and deliveries in Ethiopia, Haiti, Namibia, Rwanda, Tanzania, and Zimbabwe were more than 99% generic. Procurement of generic fixed-dose combinations increased from 33.3% in 2005 to 42.7% in 2008. The savings attributable to generic ARV use has allowed PEPFAR country programs to shift funds from their ARV budget and invest further in other priority activities, including training for health care workers, and expansion of direct service provision to patients.

“When PEPFAR started, many doubted that it would be possible to provide antiretroviral treatment on a large scale in the low- and middle-income countries,” said Ambassador Mark Dybul, former US Global AIDS Coordinator, now at Georgetown University and the George W. Bush Institute. “The initial goal of supporting treatment for 2 million people in 5 years was met early, and generic ARVs helped to make that possible.”

“This work is so important because we simply must gain the greatest possible value for every dollar we spend so we can save as many lives as possible, said Ambassador Eric Goosby, U.S. Global AIDS Coordinator. “Drugs are no longer the main driver of treatment costs, so in addition to savings from generics, the systems we’ve put into place for procurement and distribution are making efficiencies possible throughout national health systems. Our increasing efficiency is saving money that PEPFAR and the broader U.S. Global Health Initiative can use to save more lives – and that’s the bottom line.”

“We see that through a concerted effort to focus on both price and quality, PEPFAR has saved hundreds of millions of dollars, while expanding access to HIV treatment and saving lives,” said Dr Gottfried Hirnschall, the World Health Organization’s Director for HIV/AIDS. “This is exactly the kind of effort that will be necessary to successfully expand access to earlier HIV treatment in response to our new WHO guidelines.”

One of the biggest hurdles to the rapid scale-up of antiretroviral therapy in the developing world was the price of antiretroviral drugs. Modification of an existing U.S. Food and Drug Administration (FDA) process to expedite review and approval of generic ARVs quickly resulted in a large number of FDA-tentatively approved ARVs available for use by PEPFAR. By 2008, the number of ARVs approved through the FDA tentative approval process had risen to 80, from 15 in 2005. During the tentative approval process, U.S. Government officials worked closely with the World Health Organization. As a result, 67 products have been automatically added to the World Health Organization’s list of prequalified drugs following FDA tentative approval, making those products globally available. The first combination pediatric formulation was among such products.

To further accelerate the reliable procurement for these ARVs, PEPFAR also developed Supply Chain Management Systems, an organization that currently facilitates approximately 50% of PEPFAR procurement of ARVs.

Media Contacts:
Jennifer Peterson (PEPFAR) +1 202 255 9545, PetersonJL@state.gov
Susan Kim (O’Neill Institute, Georgetown University) +1 202 662 9465, sck3@law.georgetown.edu
Jay Heavner (SCMS) +1 571 227 8659, jheavner@pfscm.org


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