Anti-AIDS drug tender yet to be awarded

Almost a year after the South African government invited tenders for anti-AIDS drugs from potential suppliers, the contract to supply the national treatment programme has yet to be awarded.

The delays in the procurement process have increased the growing frustration over the slow pace of the rollout. By the end of 2004 the health department estimated that about 19,500 HIV-positive people were receiving free antiretroviral medication from state facilities - about half a million South Africans need treatment.

News reports last week revealed that the process appeared to have stalled over the multinational drug companies' dissatisfaction with government stipulations.

According to local newspaper Business Day, the department of trade and industry requires companies signing government contracts with an imported component of more than US $10 million to invest 30 percent of this slice back into South Africa.

"It's a strange requirement for companies that invest so much in a country anyway, but we are prepared to discuss this with government," Kevin McKenna, director of Boehringer-Ingelheim in South Africa, told PlusNews.

The company is one of eight that have been short-listed, including local manufacturer Aspen Pharmacare, Bristol Meyers Squibb, CiplaMedpro and GlaxoSmithKline.

But there were no "suspicious ulterior motives" in the delays, McKenna said. "They are trying to get their act together."

Nevertheless, the current "uncoordinated" situation with regard to obtaining ARVs could not continue for much longer for the firms, experts warned. Provincial health departments have been getting the medication directly from the drug manufacturers - bypassing the state tendering process.

"Fundamentally, at present they're operating on the basis of quotations, and rely on month-by-month forecasting by provincial programmes to schedule import, local packaging or production. As off-take [the amount] has been variable in the different provinces, they're battling to accommodate some of the larger orders," Andy Gray, senior pharmacology lecturer at the University of KwaZulu-Natal, told PlusNews.

The three-year tender was unlike most state tenders, as the government was negotiating prices with the short-listed companies. Gray admitted that the negotiation component was "certainly delaying the process, but could have been completed, had there not been other issues at stake".

"They [government] are trying to get the lowest possible price and achieve other aims at the same time [the 30 percent investment stipulation]. This won't work," he warned.