The upcoming tender for antiretroviral meds (ARVs) in South Africa will be opened up to more companies in a bid to tackle shortages, an insider told us.
The region recently suffered a heavy blow for its public sector programme – that provides HIV treatments tenofovir (TDF) and abacavir (ABC) to millions of sufferers – when PEPFAR (the US President’s Emergency Plan For AIDS Relief) stopped handing out donor money to buy drugs from other countries late last year.
And when Sonke Pharmaceuticals, one of the two suppliers which make up the current tender for TDF, failed to meet the ever increasing demands the deficit widened further.
Speaking to in-PharmaTechnologist.com about the region’s recent woes, the other half of the TDF tender, Aspen Pharmaceuticals, said it believes the Government will learn from past errors when finalising its next tender in six months’ time and will create a stronger supply chain.
Of the problems Stavros Nicolaou, senior director for the Sub Saharn firm, said: “There was quite a growth in the need for TDF because of two main reasons. Firstly, last year the Government was procuring the products through donor funds, largely from Obama’s which accounted for around $130m (€103m) until last November when the money dried up.
“There was very little warning from the South African Government until late in the day. It meant there was a shortfall of between 200,000 to 800,000 packs of TDF per month, a shortfall Aspen and the other supplier was asked to make up very quickly.”
He said that though Aspen, which is contracted to make up 70 per cent of the current supply – around 750,000 packs per month – has ramped up production in excess of 1.5m packs, the other firm (Sonke) were distributing just 25 per cent, five per cent less than its target.
Nicolaou said that though the situation is now stabilised, the five month accumulative shortfall has left a gap.
“There are 1.1m patients on TDF in the public sector; last month we produced 1.5m packs, which has stabilised the situation” he said. “The problem is that if the other firm’s commitment is 350,000 packs, and they only provide 300,000 for a few months, it accumulates.”
When asked the reasons for its inability to meet demands, Sonke declined to respond.
More players means a better game
For the next tender, the South African Government’s National AIDS plan intends to reach 2.5m patients by 2013 – an 800,000 person increase in 18 months.
Though Aspen is now preparing to boost its production capacity even further to meet the demands, it says it is crucial the Government looks to more than one provider.
“Aspen has got the largest manufacturing plants in the Southern Hemisphere, and we have a good raw material supply chain with multiple suppliers in different countries, so we have the capacity to scale up quickly without having to add capacity,” said Nicolaou.
“But I think next time multiple firms will be awarded the tender, and I think we would prefer it that way. You never want to be in the position where you’re left with shortages in the supply chain, no matter how good it is for your firm commercially. You never want to be the sole supplier.”
Of the type of firm the Government will look to, he guessed those operating locally have the edge.
However he said that any ARV maker with “competitively priced medication,” and “good supply records” are likely to be in contention for the tender.
When asked if this could be a good opportunity for foreign manufacturers to work within the area, he said: “Most certainly. South Africa has a very progressive industrial policy. There are strong relationships with firms from outside the country and the industry has flourished.”