Biregional Workshop on Promoting Ethical Practices in Medicines Registration and Procurement, Penang, Malaysia, 31 May-2 June 2005 : report

(WP)PHAJICPIHTP/5.1I001 Report series number: RS/2005/GEI12(MAA)

English only

REPORT BlREGIONAL WORKSHOP ON PROMOTING ETHICAL PRACTICES IN MEDICINES REGISTRATION AND PROCUREMENT

Convened by:

WORLD HEALTH ORGANIZATION REGIONAL OFFICE FOR THE WESTERN PACIFIC Penang, Malaysia 31 May-2 June 2005

Not for sale Printed and distributed by: World Health Organization Regional Office for the Western Pacific Manila, Philippines May 2006

WHOIWPRO LIBRARY MANILA. PHILIPPINES

o2 AUG 2006

NOTE

The views expressed in this report are those of the participants in the meeting and do not necessarily reflect the policy of the World Health Organization.

This report has been prepared by the World Health Organization Regional Office in the Western Pacific for governments of countries and areas in the Region and for those who participated in the Biregional Workshop on Promoting Ethical Practice in Medicines Registration and Procurement which was held in Penang, Malaysia from 31 May to 2 June 2005.

CONTENTS

SUMMARY 1. INTRODUCTION AND BACKGROUND .......................................................................... 1 1.1 1.2 1.3 1.4 1.5 1.6 Background information ............................................................................................... 1 Objectives ..................................................................................................................... 2 Participants .................................................................................................................... 2 Organization and content of workshop ......................................................................... 2 Opening remarks ........................................................................................................... 2 Appointment of Chairperson, Vice- Chairperson and Rapporteurs .............................. 3

2.

PROCEEDINGS .................................................................................................................... 3 2.1 2.2 2.3 2.4 2,5 2.6 Promoting Ethical Practices in medicines registration, selection and procurement ............................................................................................ 3 Good Practices in Medicines Registration, Selection and Procurement ........................................................................................................... 5 Presentation of country assessments of medicines registration, selection and procurement ............................................................. '" ............................ 7 Ethical framework for the pharmaceutical sector: why it is needed and how t~ develop it.. ..................................................................... 11 Group work; identification of ethical core values in the pharmaceutical sector .................................................................................................. 15 Development of national plans of actions for promoting ethical practices in medicines registration and procurement ........ '" ........................... 16

3.

CONCLUSIONS AND RECOMMENDATIONS .............................................................. 17 3.1 3.2 Conclusion .................................................................................................................. 17 Recommendations ....................................................................................................... 18

ANNEXES: ANNEX 1 LIST OF PARTICIPANTS, TEMPORARY ADVISERS, CONSULTANT , OBSERVERS/REPRESENTATIVES AND SECRETARIA T AGENDA TIMETABLE ASSESSMENT TOOL

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ANNEX 2 . ,ANNEX 3 ANNEX 4

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Keywords: Governance / Accountability / Asia, Southeastern / Western Pacific

SUMMARY

A Biregional Workshop on Promoting Ethical Practice in Medicines Registration and Procurement was held in Penang, Malaysia, from 31 May to 2 June 2005. The objectives of the workshop were: (I) to review the results of country assessments of medicines registration and procurement systems and identify areas where improvement is necessary to strengthen the systems and promote ethical practices; and (2) to produce a draft general framework for promoting ethical practices in medicines registration and procurement and improving good governance and transparency. The 18 participants in the workshop came from Cambodia, Indonesia, the Lao People's Democratic Republic, Malaysia, Mongolia, the Philippines, Papua New Guinea, Thailand and Viet Nam. The assessors who had conducted the assessments of medicines registration and procurement system in their respective countries, the Lao People's Democratic Republic~ Malaysia, Philippines and Thailand, were invited as temporary advisers to share their findings. Participants listened to an overview of the WHO/ Australian Agency for International Development (AusAID) collaborative project, Fighting corruption through ethical medicines regulation and procurement, and to results of the assessments of medicines registration and procurement systems in the four countries. They were introduced to the reasons for the occurrence of unethical practices in the pharmaceutical sector and to the general principles of promoting ethical practices in medicines registration, selection and procurement. Before working in groups to determine ethical values in medicines selection, registration and procurement, the participants identified the strengths, weaknesses, opportunities and threats (SWOT) present in the pharmaceutical sector in their respective countries, especially in medicines registration, selection and procurement. They were introduced to an ethical framework for the pharmaceutical sector, were informed why ethical considerations are needed, and also received guidance on the application ofthe general principles of an ethical framework in the pharmaceutical sector. Participants indicated priorities in their national plans with regard to an ethical framework for the pharmaceutical sector by including the most critical issues to be addressed and recommendations for action to their respective Ministries of Health. They also discussed the assessment ofthe pharmaceutical sector. The national plans, which would serve as guides for national implementation, were also the basis for discussion on intercountry and WHO collaboration. The workshop concluded that promoting good practices in medicines registration, selection and procurement is crucially important to ensure that efficacious, safe and good quality medicines are available and affordable to the entire popUlation. Participants stressed the fact that the pharmaceutical sector is vulnerable to unethical practices that threaten that goal. Therefore, there is an urgent need for countries to establish ethical practices in medicines registration, selection and procurement.

A draft global framework on ethical practice on medicines registration, selection and procurement will be developed using the knowledge gained from the presentations and group discussions on the three subject areas. The framework will be used as a basis for further consultation, adoption and implementation in each country.

1. INTRODUCTION AND BACKGROUND

I .1

Background infonnation

Registration and procurement of medicines are two essential functions in the phannaceutical sector upon which adequate access to good quality essential medicines in any country depends. Registration of medicine is a crucial government function that ensures the quality, efficacy and safety standards of registered medicines. It is also one of the most important barriers to entry into the pharmaceutical market. The medicines registration process can be vulnerable to corruption if its procedures are not transparent and efficient. Procurement of medicines, not only requires accurate purchase quantification, but must also ensure that the right types of medicine are procured to meet the needs of the population. Procurement procedures must be transparent by following formal written procedures throughout the process and using explicit criteria to award contracts to reduce conflicts of interest. Besides these two functions, medicine selection also requires governments to make decisions about what medicines can most cost-effectively treat the medical and health needs of the majority of the population. The selection of medicines for inclusion in an essential medicines list may be vulnerable to conflicts of interest if the process is not transparent, because the manufacturers of the selected medicines stand to make considerable profit from the inclusion of their product on a fonnulary. If the selection procedures are limited, there is the potential for resistance from medicine suppliers and doctors, as well as consumers. Therefore, promoting ethical practices in medicines registration and procurement is a significant step towards supporting Member States in strengthening their medicines regulatory systems and improving the efficiency of their registration and procurement to reach the goal of improving access to essential medicine. As a follow-up to one element of the Regional Strategy for Improving Access to Essential Medicines in the Western Pacific Region, endorsed during the fifty-fifth session of the Regional Committee in Shanghai, China, in September 2004, namely promoting good and ethical pharmaceutical practice in public and private sectors, the WHO Western Pacific Regional Office initiated a collaborative project on "Promoting ethical practices in medicines registration and procurement systems" with some Member States. Promoting ethical practices in the pharmaceutical sector is also part of the WHO Global Medicines Strategy for 2004-2007. The project has been implemented in selected countries: the Lao People's Democratic Republic, Malaysia and the Philippines from the WHO Western Pacific Region; as well as Thailand from the WHO South-East Asia Region. An infonnal consultation meeting to review the methodology of assessment of medicines registration, selection and procurement systems was conducted in Manila, the Philippines, from 25 to 26 November 2004. Following that meeting, several assessments were undertaken to provide infonnation through a situation analysis, including identification of areas where improvements are required, especially in preventing and minimizing unethical practices. Based on the results of the assessments, a general framework to promote ethical practices in medicines registration and procurement and to improve systems to deter unethical practices will be pursued.

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1.2

Objectives The objectives of the workshop were: (I) to review the results of country assessments of medicines registration, selection and procurement and identifY areas where improvement is necessary to strengthen the systems and to promote ethical practices; and (2) to produce a draft general framework for promoting ethical practices in medicines registration, selection and procurement and improving good governance and transparency.

1.3

Participants

Eighteen participants from nine countries in the Western Pacific and South East-Asia Regions, nine temporary advisers, two consultants and two observers attended the workshop (Annex I). 1.4 Organization and content of workshop

The programme for the workshop was divided into five main sessions: (I) introduction of the project and presentation of ethical challenges in the pharmaceutical sector; (2) WHO good practices in medicines registration, selection and registration; (3) presentation of country assessments; (4) development of national plans of action for promoting ethical practices in medicines registration, selection and procurement; and (5) drafting of an ethical framework for the pharmaceutical sector. There were three group works sessions to (I) carry out a SWOT analysis for each country; (2) develop core values and principles for medicines registration, selection and procurement; and (3) develop national plans for each country. . Each session started with an introduction and overview of the global and regional status, followed by a discussion and exchange of views and experiences in plenary and working group sessions. The workshop concluded with a review and adoption of major recommendations. The workshop agenda and programme of work (timetable) are in Annexes 2 and 3. The participants were provided with background and discussion papers related to the subjects, and a complete set of all country presentations, in hardcopy as well as on compact disc, with all the workshop presentations in Powerpoint@ format. 1.5 Opening remarks

The Regional Adviser on Pharmaceuticals, WHO Western Pacific Regional Office, Dr Budiono Santoso, welcomed all participants to the workshop. Mr Jun Yoshida, Technical Officer, Pharmaceutical Unit, WHO Western Pacific Regional Office delivered the opening speech on behalf of Dr Shigeru Omi, WHO Regional Director for the Western Pacific. He said that equitable access to good quality essential medicines and the appropriate use of those medicines are paramount if medicines are to contribute to improving public health. For more than 25 years, WHO has been committed to working with Member States and partners to improve access to good quality essential medicines and ensure their appropriate use by health care providers and consumers. In collaboration with Member States and partners, WHO developed the Regional Strategy for Improving Access to Essential Medicines 2005-2010 to be used as a guide to further strengthen those efforts.

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Medicines registration, selection and procurement, which are important functions in the pharmaceutical sector, influence access to medicines with assured safety, efficacy and quality, and inefficient systems and unethical practices in these three areas could jeopardize timely access to medicines for those in need. WHO's goal is to strengthen the resistance of the pharmaceutical system to unethical practices, thereby contributing to improved public sector management and good governance, which ultimately will also improve access to needed medicines. In collaboration with AusAID, WHO is carrying out a project to improve ethical practices in medicines registration, selection and procurement to promote good governance in Member States. He also emphasized that the workshop would identify and propose actions for improvement based on the results of assessments undertaken in some countries. The principles and a framework for ethical practices in medicines registration, selection and procurement would be discussed for further adoption in countries. Dr Rahmat Awang, Director of National Poison Centre, WHO Collaborating Centre for Drug Information, welcomed all participants. 1.6 Appointment of Chairperson. Vice-Chairperson and Rapporteurs

The workshop elected Mrs Noorizam bt. Ibrahim from Malaysia as Chairperson and Dr Lamphone Syhakhang from the Lao People's Democratic Republic, as Vice-chairperson. Dr Zaenal Komar, Indonesia, and Ms Conception S. Liberan, the Philippines, were elected as Rapporteurs.

2. PROCEEDINGS

2.1 2.1.1

Promoting ethical practices in medicines registration. selection and procurement WHO/AusAID collaborative project, Fighting corruption through ethical medicines

regulation and procurement Dr Budiono Santoso, Regional Adviser in Pharmaceuticals, WHO Western Pacific Regional Office, presented the scope of activities and the implementation status of the project. He first stated the reasons why it is important to promote ethical practices. One important reason is that unethical practices in medicines registration, selection and procurement can have a significant impact on access to needed medicines. However, in some countries the existence of unethical practices goes un-noticed. The WHO Western Pacific Regional Office is now vigorously implementing the Regional Strategy for Improving Access to Essential Medicines, 2005-2010, which includes promoting ethical practices. Some factors influencing unethical practices were also highlighted, including, among others, individual and social values, lack of awareness, inefficiency in the existing system, the executive power and authority enjoyed by individual officers, conflicts of interest, lack of transparency, poor incentives, the low salaries of officers, and the inefficient legal systems in some countries. The strategy to minimize or prevent unethical practices includes a regulatory approach, through legislation and law enforcement; a managerial approach, through improving transparency, prevention of conflicts of interest and monitoring of practices; and an educational and behavioural approach, through improving awareness and knowledge and development of ethical codes. From the social and environmental

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perspectives, the approach includes consumer empowerment and establishing consumer watchdog and monitoring processes. The objectives of the collaborative project were presented as: to strengthen the resistance of the pharmaceutical system to corruption by promoting ethical practices; to improve the transparency of the system; to improve the system's capacity to manage conflicts of interest; and to improve efficiency in the medicines regulation and procurement system. During the first phase (2004-2005), the project was implemented in Malaysia, the Lao People's Democratic Republic and the Philippines in the WHO Western Pacific Regional Office and Thailand in the WHO South-East Asia Region. During the second phase, the project will continue in these countries and will also be expanded to other countries, namely Cambodia, Indonesia, Mongolia, Papua New Guinea and Viet Nam. Implementation of the project in each country during phase I was undertaken in a systematic manner, starting from country assessments of existing practices, followed by the intercountry workshop to share the findings and develop a framework of ethical practices. This will be followed by national consultation meetings to adopt national frameworks for ethical codes, and advocacy and implementation of those codes. Depending on the availability of funds, there could be another assessment after the implementation of the ethical codes. It is important to note that the participation of each country needs to be agreed upon by the Government, with the involvement of the medicines regulatory authority, the state procurement agency and relevant independent groups. Following the presentation, Dr Eloy Anello, WHO consultant, asked participants to express their views about the objectives of the workshop and its expectations. The popular expectation of the workshop was sharing of experiences and learning the viewpoint of others. He said that it was necessary to CIcllte a frllJJlework with cwe values to establish public trust. He noted the wide variety of concerns and stressed that the primary objective was to develop a framework for ethical management of registration, selection and procurement procedures. He drew participants' attention to the programme of the workshop and oriented the discussions. He further explained the expected outcomes, namely to share and learn experiences from others, to obtain feedback on the assessment tool, based on the results, and to develop a framework or pre-design principles for ethical practices. The final outcome would be the development of action plans. 2.1.2 Corruption in the pharmaceutical sector

Dr Guitelle Baghdadi, Technical Officer, WHO Headquarters, introduced the global perspective on the corruption problems seen in the pharmaceutical sector. She mentioned that corruption has been identified as the single greatest obstacle to economic and social development and referred to the World Bank definition of corruption, which states" ... behaviour on the part of officials in the public and private sector, in which they improperly and unlawfully enrich themselves and/or those close to them, or induce others to do so, by misusing the position in which they are placed". There are different kinds of corruption such as economic and political corruption (Pranab Bardhan). The pharmaceutical system is vulnerable to corruption for a number of reasons: the market volume and economic interests; the information imbalance regarding the quality, safety and efficacy of medicines; the high degree of government involvement in its regulation; poorly defined and documented processes; limited or too many institutional checks; inappropriate intensive structures; and the difficulty in differentiating between corruption and inefficiency. Thus, corruption can be found at almost every level of the medicines chain: research and development; patenting; manufacturing; registration; pricing; selection; procurement and importation; distribution and prescription; and consumption. This subsequently may result in

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spending most resources on lifestyle and "me-too" drugs, closer financial links between industry and researchers, excessive extension of "best selling medicines - evergreening", the presence of substandard and counterfeit products, unethical donations, theft, unethical promotional practices, etc. Unethical practices can have economic, health and trust impacts. Their impact on the health system may lead to a waste of public resources, a lack of essential medicines, irrational use of medicines, and a reduction in the credibility of public institutions, the health care profession and the pharmaceutical industry. In her summary, Dr Baghdadi said that WHO has developed numerous technical guidelines on different areas (good manufacturing practices, good procurement practices, etc.) which provide the scientific knowledge on how to improve pharmaceutical systems. Despite this technical knowledge however, some countries do not have efficient systems, partly due to unethical practices. The challenge now is to introduce, in addition to the technical knowledge and practices, ethical practices promoting principles for a "corruption-free" pharmaceutical sector, such as accountability, transparency, efficiency and effectiveness, responsiveness, forward vision, institutional pluralism, participation and rule of law. In the subsequent discussion, a question was raised regarding institutional checks and the extent to which these should be applied. The presenter said that there was no common guide for this. It was necessary to consult with the drug regulatory authorities and to reach a balance. Mrs Nazarita Lanuza, WHO consultant, said the interpretation of guidelines was one important factor in promoting ethical practices because all aspects cannot be covered by rules and it depends upon individuals. There are no boundaries between technical and ethical matters. She suggested that basic understanding of the ethical practices of the country is necessary. 22 2.2.1 Good practices il1m.edicines registration, selection and procurement Good practices in medicines registration, selection and procurement

Mr Jun Yoshida, Technical Officer, Pharmaceutical Unit, WHO Western Pacific Regional Office, gave a presentation on good practice in medicines registration. He briefed participants on the overall process of drug registration and elaborated the pre-conditions before discussing good and ethical practices including: (1) who gets involved in what process and by what rules must be clear inside and outside the systems/organizations; (2) minimum criteria must be met; and (3) the individuals concerned must be familiar and comply with the rules. The above requires (I) administrative management and clearing-house policy implementation; (2) clarification on who should necessarily get involved in what process (the rules are categorized according to the scope of the system/procedures and the relations with a third party, and the extent of legal obligations into laws, ordinances, administrative provisions, guidelines or standard operating procedures, SOPs); and (3) clearance through evaluation of expertise, knowledge, ethical sense, etc, and declaration of interests. He stressed the importance of the internal and external relations of drug regulatory officials and gave a list of problematic performances relevant to drug regulatory staff and asked the participants if each of those performances was justifiable. The important consideration was that, even if they could justify or make some excuse for their actions within the system, people outside the system might not think the same way and may suspect an inappropriate relationship with the applicants. He also gave some instances where drug regulatory staff would hesitate to make a decision to proceed with the processes. He affirmed it is, after aU, the individual who finally makes decisions at each point. Imagination/inspiration is an important factor in avoiding being trapped in unethical or illegal activities. He concluded that expertise, self-governance and imagination are integral characteristics requested of each individual staff member. At the same

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time, a system of governance is also necessary to prevent individual violations of rules, to allow appropriate individual discretion and to make the individual accountable for his/her performance. 2.2.2 Good practices in medicines selection

WHO good practice in selection of essential medicines selection was presented by Dr Guitelle Baghdadi, Technical Officer, WHO Headquarters. She stated that the concept of essential medicines was based on the fact that a limited range of carefully selected essential medicines leads to better drug management and low costs, and these are medicines that satisfY the priority health care needs of the population. So far, 156 countries have developed their own national essential medicines lists. Selection of essential medicines is a two-step process; the first step is to get market approval. The second step begins with defining a list of common diseases and complaints for each level of health care, which serves as a basis for the list of essential medicines, the national formulary, and the treatment guidelines, as well as for financing and supply of medicines. Written and clear criteria procedures should be publicly available for selection of essential medicines, taking into consideration disease prevalence, efficacy and safety, cost-effectiveness, local manufacturing capacity and compounding of the medicines. She also said that an independent group composed of experts should form different field selection committees with clear terms of reference. Declared conflicts of interest, standard application forms, rapid public dissemination and regular review and update of the list were prerequisites for minimizing any conflict of interest. WHO's experience in reviewing applications could be used as a guide for this procedure because of potential vulnerabilities, such as manufacturers or importers offering incentives to public officials, or a committee member influencing the final decision on selection of appropriate essential medicines. 2.2.3 Good practice In medicines procurement

Procurement is defined as the process of acquiring supplies from private or public suppliers or through purchases from such sources as manufacturers, distributors, agencies, etc. Ms Vanchinsuren Lkhagvadorj, Pharmaceutical Unit, WHO Western Pacific Regional Office, stated that the procurement of medicines consists of various complex processes, such as estimation of needs, review of needs and funds, selection of procurement methods and suppliers, specification of contract tenns, monitoring of orders, receiving and checking of orders, making payments, distribution of medicines and collection of consumption information. All these ensure the availability of the right medicines in the right quantities at the lowest possible cost at the right time and with recognized standards of quality. However, common problems and issues are encountered in medicine procurement: the absence of a comprehensive procurement policy; disintegrated or fragmented procurement at lower levels; a lack of accurate and unbiased market information; a lack oftrained, experienced procurement staff; and unregulated medicine donations that conflict with procurement regulations and which might lead to an irregular supply of medicines. She elaborated the main principles of good procurement practice as: transparent procurement procedures, procurement of the most effective medicines in the right quantities, using competitive procurement, selection of reliable suppliers, and assurance of timeliness and value for money. Procurement of medicines is most vulnerable to corruption if there are no mechanisms to manage conflicts of interest and a lack of transparency about the procedures that describe the procurement process and the criteria used to award contracts, as well as government commitment to solve the problem.

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The presentation was followed by a question regarding the 'cost-effective' method of procurement and what analysis is required. Based on the availability of data, it is more feasible to unde.rtake more pr~ct~cal financial expenditure analysis, like ABC and VEN analyses rather than usmg more sophisticated pharmacoeconomic analysis, such as cost-effectiveness analysis. In many developing countries, there are no accurate data on the defined population that enable economic analysis of medicine purchases. 2.3 2.3.1 Presentation of country assessments of medicines registration, selection and procurement Review of the assessment tool

Before presenting the results of the country assessments, the tools used were reviewed and discussed by the assessors to find out whether any changes are needed. The objectives of the assessment were to provide a diagnostic framework and methodology to evaluate a pharmaceutical system's vulnerability to unethical practices and to determine which unethical practices could have a major impact on the system. Quantitative and qualitative methods, consisting of 54 questions, were used for data collection. These were arranged under three decision points: medicine registration, medicine selection and the procurement of medicines (Annex 4). Ten key informants were reviewed for each decision point. A binary (yes=I1no=O) system was used to minimize subjective interpretation of respondents' answers. A value of I represents low vulnerability to corruption, while 0 represents high vu Inerability to corruption due to the absence of a standardized process or decision criteria. The coding and calculating methods were introduced in an informal preparatory Workshop on Promoting Ethical Practices in Medicines R~gist!atiQII lIRd PmglJf~ment th_at tQok place in Manila, the Philippines, from 25 to 26 November 2005. A ten-point rating system was used to represent the following degrees of vulnerability to corruption.

0.0-2.0 Extremely vulnerable

2.1-4.0 Very vulnerable

4.1-6.0 Moderately vulnerable

6.1-8.0 Marginally vulnerable

8.1-10.0 Minimally vulnerable

The following main comments were raised during the discussion: o o

Really sensitive aspects of corruption (gifts, privileges, etc.) were not captured. There are only structural indicators -7 add process indicators as well. Interpretation guidelines are not always clear. The assessment tool should be expanded to also cover inspection, promotion and distribution. The feedback obtained is a mixture of evidence and perception. It is important that the key informants be directly involved with system. The evidence is the real document, but perception is also important because of the subject. This can be reflected in the narrative part of the report;

o o

o o o

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o o

The number of key informants should be increased to enrich the evidence base. Some questions are not relevant to the private sector (not always aware of the dynamics in the public sector). It is difficult to get documents from the private sector (confidentiality). Interviews should also be conducted at the national quality control laboratory. Focus group discussions should also be used.

o o o

Based on the above comments and the discussion that followed, the assessment tool will be revised before extending the assessment to the four new countries. The results of the country assessments were presented by the temporary advisers who coordinated the assessments in their respective countries. 2.3.2 The Lao People's Democratic Republic

The National Drug Policy Programme was adopted in 1993 with the goal of ensuring the availability of safe, good quality, efficient, essential drugs with an affordable price to those who needed them and to ensure the rational use of those drugs. The pharmaceutical system, including registration, selection and procurement, is under the responsibility and supervision of the Food and Drug Department (FDD), in collaboration with various other concerned departments. The average score for drug registration (5.6) indicates moderate vulnerability to corruption. The committee for medicine registration was established under the Ministry of Health, led by the DIrector of the FbI5 and-with a membership consisting of the staff of the FDD and other specialists in the field of patient care. The medicines registration guidelines are documented. The standard application form is readily available at the FFD but is not yet on its website. The drug registration fee has been set by regulation. However, the committee members of the drug registration process were not asked to declare any conflict of interest. There is no appeal process for applicants when their drug does not achieve registration. The overall average score for drug selection was about 6.1, indicating marginal vulnerability to corruption. There is a drug selection committee that reviews the national essential medicines list (EML), which was first established in 1977. The national essential medicines list has been revised three times since its development and most of the drugs are generic and on WHO Model List. The criteria for including or excluding drugs from the EML are clearly stated on the list itself. However, there is no conflict of interest form for the members of the selection committee to fill out. Lastly, the procurement of pharmaceuticals obtained an average score of 7.0, denoting marginal vulnerability to corruption. The procurement of pharmaceuticals is based on a decree issued by the Ministry of Finance. Four methods of procurement (public bidding, limited bidding, price comparison and direct contracting) are applied to the purchase of pharmaceuticals, depending on their value. The written procedures for drug procurement and the contract specifications are publicly available. Tenders for pharmaceuticals are rarely announced in the newspaper, and are restricted to those pharmaceuticals belonging to projects that call for public bidding. Suppliers' performance is monitored periodically. However, there is no formal appeal process for the procurement of pharmaceuticals and no specific criteria for tender committee membership. Members are appointed by the Minister of Finance for a two-year term. Overall, the pharmaceutical system obtained a rating of6.3, indicating marginal vulnerability to corruption. The following concerns were addressed to the committee. It should clearly write the criteria for selection. The terms of references should also be clearly written out and be made publicly available. The procedures for registration, selection and procurement, and

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the pr~cedur~s f~r decision-making, should be documented and widely known, and clear tendenng gUldelmes should be publicly available. An independent body should conduct the annual audit. 2.3.3 Malaysia

The National Pharmaceutical Control Bureau, established in 1978, is the regulatory agency acting as the secretariat to the Drug Control Authority. It implements activities in relation to registration of pharmaceutical products; licensing of premises for importers, manufacturers and wholesalers; monitoring of the quality of registered products in the marketplace; and monitoring of adverse drug reactions. The total average score for the pharmaceutical system was 6.1, indicating marginal vulnerability to corruption. A drug registration scheme has been implemented since 1995 in four phases. Drug registration received an average indicator score of 6.6, indicating marginal vulnerability to corruption. Selection of medicines collected a score of 4.9, indicating moderate vulnerability to corruption. The Ministry of Health has a comprehensive reference document called the "Blue Book", which contains drugs that are available in public health facilities and those drugs listed in the WHO Model List of Essential Medicines. There are also guidelines on the selection of drugs that contain procedures for the inclusion and deletion of drugs from the Blue Book. Medicines committees are functional at hospitals as well as central level. Procurement of medicines scored 6.9, denoting marginal vulnerability to corruption. The procurement system is largely controlled by directives from the Ministry of Finance. The latter has also come up with policies in line with the Government's privatization efforts. The speaker emphasized that there are many reasons for the spiralling cost of drugs, such as the increased cost of investments in phannaceutical research and development, the increased specificity and efficacy of drugs, and the increased demand for medications by an ageing popUlation. It is also possible that there is a lack of transparency in medicine registration, selection and procurement. Managers of health care services and pharmacists could do a lot more to help alleviate these problems, such as studying the efficiency of using funds (pharmacoeconomics) in the purchase of drugs and introducing evidence-based phannaceutical practices. He concluded that one sure way of providing a cost-effective pharmaceutical and health care service was improving transparency in the registration, selection and procurement of drugs. The survey showed that there was ample room for improvement. He thanked all respondents who had the sincere wish to improve and enhance transparency in all aspects of the pharmaceutical service. 2.3.4 Thailand

There are two major organizations, the Thai Food and Drug Administration (FDA) and the Department of Medical Sciences, involved in medicines registration, selection and procurement issues. The related legal enactments consist of the Drug Act B.E 2510, with four amendments, the Freedom of Information Act and the Anti-corruption Act. A drug committee, consisting of government delegates and experts, is appointed by the Minister of Health every two years to advise the Minister on both the regulatory and technical aspects of phannaceutical control. The drug committee has several sub-committees to assist it with related tasks. According to the assessment, the drug registration area received an average score of 6.94, indicating marginal vulnerability. It is well documented and the requirements are standardized. There is fair access to information, which is publicly available on the FDA website. However, there are

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no standard forms for declaring any conflict of interest and no documentation procedures for the committee's decision-making. The current EML was prepared and approved by the Subcommittee on Development of Essential Medicines List in 2004. Drug selection obtained the highest rating, 8.04, indicating minimal vulnerability/a high level of transparency, and this area is very well documented. The criteria for drug inclusion and exclusion are also clearly documented and published. There are systems to declare conflicts of interest but they do not have clear and comprehensive sanctions. The subject of pharmaceuticals procurement is not isolated from other procurement. In fact, there is a regulation on the concept and criteria for the public sector to follow in purchasing all products, including pharmaceuticals. Three levels of purchasing are applied, depending on the value ofthe purchase. The score of 7.22 in the area of procurement indicates marginal vulnerability to corruption. Perhaps it is the most vulnerable area in the pharmaceutical arena, as the Minister of Public Health is in prison due to corruption. However, there are clear written procedures and clear guidelines for committee members and for presenting a bid. Medicines registration and procurement systems are assessed as marginally vulnerable to corruption, while selection of drugs for the EML is minimally vulnerable. The weakness of registration is seen in the area related to conflict of interest and transparency of membership and terms of reference of the committees. Legislation and regulation should be revisited and updated continuously. 2.3.5 The Philippines

Drug registration is one of the main responsibilities of the Bureau of Food and Drugs (BFAD). It scored 6.8, denoting marginal vulnerability to corruption. There is a standard application form which requires details on the product name, manufacturer, generic names of the substances, pharmacological action, therapeutic classification and packaging insert. The information on drug registration procedures !~ pl,I!?licly ~ces_sibl~. Th_ere are three types. of committee: (1) the advisory committee, consisting of external consultants; (2) the evaluation committee within the BF AD; and (3) the management committee. The evaluation group is considered to be the decision-making committee, with the management committee only regarded as the decision-making body in questionable cases, not routine cases. There is no declaration of conflict of interest, and no standard form publicly available. The committee does not report their decisions on drug registrations. The time period for decisions on application for drug registration is not consistent, and may take from 8 to 24 months. There is evidence of non-registered medicines in the marketplace. The main recommendations for the drug registration process are: reorganization of the BF AD to meet the needs of the general public; hiring of an expert from abroad or training of local evaluators abroad; establishment of a good recording management system to improve the system; strengthening of post-marketing surveillance; consideration of a standard form for conflict of interest for those involved in drug registration, etc. The national drug committee, also referred to as the Philippine National Drug Formulary Committee (PNDF Committee) is responsible for drug selection at the national level, while pharmacy and therapeutics committees (PTC) are accountable at hospital level. This decision area scored 6.18, indicating marginal vulnerability to corruption. The main recommendations are: to update the latest volume of the national drug formulary and disseminate it widely to health professionals and the general public; to enforce the standard form on conflict of interest; and to reorganize hospital drug selection committees. It was also noted that criteria for committee membership are not publicly available. The Procurement and Logistics Service of the Department of Health Central Office formulates plans and policies relating to procurement and logistics management of the Department. Essential medicines are procured through competitive public bidding, local

- 11 -

shopping (this is a method of procuring goods, such as medicines and the like, whereby the procuring entity requests price quotations from dealers to amounts not exceeding Php 50000), or through government-to-government transactions through the Philippine International Trading Corporation (PITC). The total scores yielded the value of 8.49, indicating minimal vulnerability for drug procurement, which is the highest among the three key decision points. Recorded weaknesses include no clear algorithm for the morbidity rate and service projection, no documentation on the enforcement ofa formal appeals process, no strict implementation of the suppliers blacklist, no appropriate management information system and the system is not easily accessible. Dr Guitalle Bagdadhi facilitated feedback from the participants. Concerns involved the balance of documentation evidence between the interview results and the key informants before interview, and the necessity to look into interviewers' backgrounds and knowledge on these areas. Their ability to explain the objectives of the work to interviewees and their knowledge on .differentiation of private and government sectors' perceptions of the indicators are also important. Transparency is an important factor and it is necessary to place information in the public domain. 2.4 2.4.1 Ethical framework for the pharmaceutical sector: why it is needed and how to develop it An ethical framework for the pharmaceutical sector

Dr Eloy Anello, WHO consultant, introduced an ethical framework for the pharmaceutical sector, including reasons why one is needed and the ways to develop it. He talked about 'social capital' and explained that it can be defined as comprising: (a) the degree of trust that exists in the population; (b) associability; (c) good citizellShip practices; and (d) the moral values and ethical principles adopted and practised by the population. He stated that corruption required two parties and referred to Sor luna Ines dela Cruz's question "Who has the greater guilt? He who sins for payor he who pays to sin". He explained further what is meant by corruption. In simple terms, "corruption is the abuse of public power to obtain personal benefit". In a more complete definition it is defined as "the phenomena by which a public functionary is impelled to behave in a manner distinct to the normative standards of the system in order to favour a particular interest in exchange for professional recompense". Corruption is therefore a deviant type of behaviour perfonned by a person who occupies a role in the governmental structure. It is a particular mode of exercising influence that is illicit, illegal and illegitimate. The definition is framed in reference to the functioning of a system and with particular emphasis on its mode of decision-making. The causes of corruption can be categorized as formal, cultural and material. Examples of formal causes are: a lack of clear delimitations between "public" and "private"; the existence of judicial orders that are inadequate; and the inoperative practices of public institutions. Cultural causes include: ample social tolerance towards the enjoyment of private privileges over civic morality; generalized illegality; persistence of traditional norms confronted by modem governmental orders and scarce prevalence of the idea of a "nation"; and the absence of ample solidarity based on the common well-being. Concrete situations that provide opportunities to corrupt practices fall under cultural causes of corruption. Material causes are the more concrete situations that provide opportunities for corruption. There are two degrees of corruption: marginal and hyper-corruption. The following areas in public service are most affected by corruption: public bidding and acquisitions; charging of public income; appointment of public functionaries (nepotism); and administration of local government. Some examples are: nepotism (favouritism), bribery, evasion and fraud, illegal contribution and abuse of public function. Some causes of the failure of reforms to combat

- 12 -

corruption are: extension of the phenomena and limitations of power; lack of commitment by high-level functionaries; unfulfilled promises; uncoordinated implementation of the reforms; limitation in the legal field; discrimination; and vested interests. Moral leadership is necessary to make reforms. The principles of public life, including the responsibilities of public functionaries, the professionalism of personnel, adequate remuneration of personnel and development and adoption of an ethical framework, are important to minimize corruption. Identifying core values is the final step in creating a common understanding within society of the expected behaviour of public office holders. According to the Nolan Commission of the United Kingdom, the following core values must be present: (1) neutrality, (2) integrity, (3) objectivity, (4) accountability, (5) sincerity, (6) honesty and (7) leadership. The shared core values expected by the Organization for Economic Co-operation and Development (OEeD) are: (I) impartiality; (2) legality; (3) integrity; (4) transparency; (5) efficiency; (6) equality; (7) responsibility and (8) justice. There are also community-promoted values: (I) accountability; (2) transparency; (3) efficiency and effectiveness; (4) responsiveness; (5) forward vision; (6) institutional pluralism; (7) participation and (8) rule oflaw. 2.4.2 Organization for Economic Co-operation and Development (OECD) - Ethical practices

Dr Anello, presented the OECD ethical practices in building public trust. He referred to the OECD Public Management Policy Brief that states "Public service is a public trust and public service ethics are a prerequisite to public trust, and a keystone ofgood governance. Core values are very important which underpin public service. Identifying core values is the first step towards creating a common understanding within ~()qif!ty ofthg gxp!:cl£.d 12ehQ'ldaur ofpublic offICe holders. The eight most frequently stated core public service values in GECD countries are (1) impartiality; (2) legality; (3) integrity; (4) transparency; (5) efficiency; (6) equality; (7) responsibility and (8) justice".

Dr Anello explained that legislating standards of behaviour has become the primary way to elaborate on stated core values. Almost all OECD countries have developed a more detailed description of the standards expected of all public servants in potential conflict of interest situations, particularly in relation to using official information and public resources, receiving gifts or benefits, and working outside the public services. In addition to the general standards applicable to all public servants, OECD countries apply supplementary guidelines for specific groups or professionals working in sensitive areas or where there is a high risk of conflict of interest, such as law enforcement or tax and custom administration. Communication is also a very effective tool in putting values into effect. Almost all OECD countries use training to raise the awareness of public servants on ethical issues. Ensuring integrity in daily management is essential for creating a working environment that ensures transparency and reinforces integrity. This can be achieved through setting standards for timeliness, requesting reasons for decisions, providing redress against decisions and requiring the identification of conflicts of interest. OECD countries almost unanimously base recruitment and promotion merit in their public service on the set standards. Besides these, internal control is widely used to detect individual irregularities and systemic failures in these countries. Taking action against violations of standards is the shared responsibility of managers and external investigative bodies. He summarized the steps for building trust in public institutions, as learnt from the OECD survey, as:

- 13 -

•

Defining a clear mission in public service: Adapting the mission of the public service to current needs and ensuring that its core values and standards meet changing public expectations are key challenges for governments in a rapidly changing world. Safeguarding values while adapting to change: The changing socioeconomic environment has led to a growing demand for transparency and requires that governments review and adjust relevant mechanisms to ensure that public servants' behaviour corresponds to expected standards. Empowering both public servants and citizens to report misconduct: Clear and known procedures that facilitate the reporting of wrongdoing and provide protection for whistleblowers assist the detection of individual cases of misconduct. Incorporating integrity measures into overall management: Integrity measures are not a distinct activity, but rather an integral part of all management systems in which they provide complementary support for the overall management environment. Coordinating integrity measures: a precondition for success: Successful integrity measures consist of a combination of actions that are consistent and take into account the wider public service environment. Assessing the effectiveness of measures provides a feedback to policy-makers on their implementation and also lays the groundwork for future policies. Shifting emphasis fmm enforcement to prevention: Sound, ethical management policies combine enforcement and prevention measures. However, there is growing recognition that increased attention to prevention reduces the need for enforcement. Prevention is a less expensive investment in the long term, with a more positive impact on the public service culture and the relationship between the public service and civil society Anticipating problems: By anticipating situations that might weaken adherence to public service values and standards of behaviour, governments can prepare suitable responses and have certain actions in place to prevent adverse effects. For example, how can governments meet increasing public criticism demand for more information on private interests that affect public education? Taking advantage of new technology: Exploring ways to harness new technologies can help governments find new ways to internalize integrity and also to inform citizens about the standards required of officials serving the public. Moral leadership and ethical practices

•

• •

•

•

•

•

2.4.3

Dr Anello stated that there are four prevailing psychological models of leadership: (I) authoritarian, (2) paternalistic, (3) manipulatory, and (4) 'know-it-all'. The sources of soc ialization, characteristic behaviours and effects on a group are different. Political parties and the academic and professional world are sources of socialization. Characteristic modes of behaviour include vertical imposition, over-protection, having a hidden agenda, using a 'divide

- 14 -

and rule' policy and ridiculing the ideas of others. The effects upon a group include: rebellion (passive or active); paralysing dependence; distraction; apathy; and inferiority complexes. Elements of a conceptual framework of moral leadership include: • • • • • • an overarching orientation of service to the common good; pro-active participation in the processes of personal and social transformation; fulfilments of the two moral responsibilities: to search for the truth and to apply it to all aspects of life; transcendence through vision; belief in the inherent nobility of human nature; and application of capabilities within the framework of moral leadership.

Categories of capabilities include those that facilitate personal transformation, interpersonal relationships conductive to team work and those that facilitate social transformation. Capabilities that facilitate personal transformation are: • • • • • the capability to evaluate one's strengths and weaknesses without involving the ego (self- evaluation); the capability to learn, based on the systematic reflection on action within a coherent and evolving conceptual framework; the capability to take initiative in a creative and disciplined manner; the capability to persevere in achievement of goals and objectives; and the capability to oppose one's lower passions and negative impulses by concentrating Qne's mind Qn higher and noble purposes. Capabilities that facilitate interpersonal relationships (team work) are: • • • • the capability to participate effectively in consultation for effective decision-making; the capability to build consensus in constructing a shared vision; the capability to encourage the heart of others; and the capability to promote unity in diversity. Capabilities that facilitate social transformation are: • • • • the capability to promote and establish justice; the capability to comprehend and transform relationships of domination towards relationships of collaboration, complementary and mutual service; the capability to understand and interpret current events within an appropriate historical perspective; and the capability to construct consensus about the common good by means of dialogue and consultation.

Clarification was requested on whether the results/data of clinical trials should be made available to hospitals/doctors before procurement decisions are taken. This relates to confidentiality of data and depends on the industry/company who are the owners of the data allowing availability of data, and not on the drug regulatory authority. However, selection is based on the EML. Practice depends upon whether the EML lists brand names or generic names.

- 15 -

2.5

Group work: identification of ethical core values in the pharmaceutical sector

. After the presen~ations, the p~rticipants were divided into five groups to identify what ethIcal Core values are Important to Improve transparency in the pharmaceutical sector. The workshop secretariat explained the group work. Each group was requested to:

• • • 2.5.1

Answer the question and discuss "Do you believe that there is corruption in your country?" If so, identify the possible causes that lead to corruption. Identify the eight core values that are necessary in promoting ethical practices in medicines registration, selection and procurement.

Group 1 (Cambodia, The Lao People's Democratic Republic, Malaysia and Thailand)

The group said that there was corruption in their respective countries in certain areas, such as price negotiation and bidding, in terms of gifts, bribery, tolerance and acceptance. However, it is difficult to identify these clearly, because there is no definitive evidence. The possible sources that lead to corruption are: the low salaries of civil servants; the high cost of living and the increased rate of inflation; the influence of others (if others can do it without any problem, why not me?); higher cost to maintain lifestyle; political pressure; a lack of social integrity among civil servants; a lack of clear limitations; the absence of cut-off points; a lack of monitoring, auditing and regulation in the system; a lack of laws or too general anticorruption laws, or irrelevant anticorruption laws that fail to cover sophisticated corrupt practices (the law can't catch up with new tactics). The group identified the eight core values as: integrity (sincerity, honesty), responsibility (accountability, efficiency), impartiality (neutrality), legality, transparency, institutional pluralism and justice. 2.5.2 Group 2 (Malaysia, Papua New Guinea, the Philippines and Thailand)

The group agreed that there are corruption practices in their countries, mostly among highlevel officials and politicians, who seem to act as if they are above the law. The most common cases are hyper- or marginal corruption. The possible causes are: absolute power; nepotism; a lack of good citizenry and associability; excessive individualism; political and politicians' forced interventions; illiteracy and miscommunication; political illiteracy at grassroots level; a lack of commitment to fight corruption by top, as well as low-level officials; weak enforcement of law (no political will and manpower shortage); and a lack of a proper system to detect corruption. The core values necessary to combat corruption were identified as: honesty (exercise function with no personal gain); integrity (upright in principles); transparency (openness); justice (follow rule oflaw to the letter); efficiency (doing the right thing in the shortest possible time); accountability (check and balance) and objectivity (evidence- based, impartiality, detachment). 2.5.3 Group 3 (Indonesia, Malaysia, Mongolia, Papua New Guinea and the Philippines)

The group said that there is corruption manifested by nepotism and by the practice of giving and receiving money and gifts. The reasons for this malpractice of giving gifts and money are: a lack of efficiency, thus it is done to get fast service; a lack of transparency in the system; no monitoring and no sanctions; self protection; and the conception of the organization as corrupt and having a weak organizational structure. The reasons behind the inclination of

- 16 -

government personnel to receive money and gifts are: low salaries; personal r7 lationships; to maintain power and prestige in the community; a weak legal system (no sanctIons, no prosecutions); a lack of ethical values; and pressure from politicians and bosses. The core values were identified as: rule oflaw; personal values of honesty and sincerity; integrity; good leadership; good governance (transparency, accountability; parti.cipation, institutional pluralism and responsiveness); justice (equity, equality and neutrahty); and efficacy and efficiency. 2.5.4 Group 4 (The Lao People's Democratic Republic, Mongolia, the Philippines, Thailand and Viet Nam) The group agreed that there is marginal corruption in four of their countries, but not in Viet Nam. The usual mode of corruption is through the giving of gifts and money. The possible causes for the above are: low salaries in the public sector; the bureaucratic system of public organizations; low educational level; a lack of trust; and misuse of authority. The core values were recorded as: transparency and legality; integrity and honesty; leadership; accountability and efficiency. 2.5.5 Group 5 (Cambodia, Indonesia, Japan, the Lao People's Democratic Republic, Malaysia, the Philippines and Thailand) Generally there is corruption in all the countries of the group. It occurs mostly at the bidding stage and takes the form of giving token gifts, etc. It is difficult to prove because there is no paper trail of corrupt practices. The level and type of corruption varies in these cOlJIltril':s, th~ most common being hyper, marginal, and survival corruption. The possible causes are: low salaries; the non-existence of anticorruption laws; a lack of public control; a lack of management; a lack of enforcement/implementation of laws; a 'forgive and forget' attitude - weak prosecution practices; illiteracy; passive attitude (nobody complains); misuse of power; and culture and lifestyle. The recognized core values are: accountability; honesty; leadership; responsibility; rule of law, transparency and participation (civic, academe community). 2.5.6 Core values for the pharmaceutical sector

The core values identified by the groups were consolidated and the most important ones were found to be: justice, impartiality, neutrality (7); transparency (6); accountability (5); rule of law (5); honesty, efficiency and effectiveness (5); integrity (4); leadership (3); sincerity (2); responsibility (2); institutional pluralism (2); participation; objectivity; good governance and responsiveness. 2.6 Development of national plans of action for promoting ethical practices in medicines registration and procurement

The session started with an introduction on how to develop a national plan of action for promoting ethical practices in medicines registration and procurement. Dr Santoso introduced the session. He explained that the national work plan for this collaborative project did not address the technical issues related to medicines registration, selection and procurement. Instead the work plan should focus on developing or adopting an ethical framework and advocating and implementing such a framework in the existing medicines

- 17 -

registration, selection and procurement mechanisms. The expected outcome of the plan ideally should include improved knowledge, awareness and acceptance of the ethical principles and the national ethical framework among officers involved in the process of medicines registration, selection and procurement, as well as improved capacity of the system in preventing and managing conflicts of interest. As mentioned earlier, project activities should be initiated with a country assessment on the existing practices in medicines registration, selection and procurement. Special focus should be paid to the areas where improvement is needed, based on the results of the country assessment. A template was provided for group work. Participants and temporary advisers from each country worked together in groups to develop their national plans. For countries which have completed the assessment (the Lao People's Democratic Republic, Malaysia, the Philippines and Thailand), the work plan would focus on the follow-up action necessary after the assessment. For countries which have not undertaken the assessment (Cambodia, Indonesia, Mongolia, Papua New Guinea and Viet Nam), the work plan would focus on the country assessment. The preliminary plan of each country was then presented and discussed in plenary. Participants were again reminded that the plan should focus only on devising, advocating and utilizing a national framework of ethical practices, and should not address other technical issues in medicines registration, selection and procurement. The main points arising from the presentation of country plans were: • Model terms of reference for assessors and criteria should be made available. A conflict-of-interest form needs to be considered. Assessment could be conducted in parallel if! the three arsas (registration, selection and procurement). Assessment should be conducted at both central and provincial levels as relevant. Informants should be involved in as many levels as possible, e.g., central and local, hospital/health centre, community, private sectors, etc.

•

• •

3. CONCLUSIONS AND RECOMMENDA nONS

3.1

Conclusions

The Biregional Workshop on Promoting Ethical Practice in Medicines Registration and Procurement, held in Penang, Malaysia, from 31 May to 2 June 2005, was the first step in the process of developing an ethical framework in the pharmaceutical sector, especially in medicines registration, selection and procurement. The workshop discussed good practices in medicines registration, selection and procurement, and the vulnerability of the pharmaceutical sector to unethical practices and corruption. Unethical practices and corruption in medicines registration, selection and procurement will ultimately jeopardize the goal of ensuring access to good quality essential medicines. The workshop concluded that promoting good practices in medicines registration, selection and procurement is crucially important to ensure that efficacious, safe and good quality medicines are available and affordable to the entire population. The workshop stressed the

- 18 -

urgent need for countries to establish ethical practices in medicines registration, selection and procurement. 3.2 Recommendations WHO: (J)

WHO, in collaboration with partner organizations, should further refine the tool for assessing transparency in medicines registration, selection and procurement. A group of experts representing medicines regulatory authorities, procurement agencies and other relevant bodies will be identified for this purpose. WHO, in collaboration with Member States and other relevant stakeholders, should undertake further consultation to refine and finalize the global ethical framework for good governance in medicines registration, selection and procurement. WHO should provide support to participating countries in the development and implementation of national ethical frameworks for good governance in medicines registration, selection and procurement.

(2)

(3)

Participating countries: (4) Assessment of transparency in medicines registration, selection and procurement, using the assessment tool, should be undertaken by an independent group as part of the process of promoting ethical practices and good governance in these areas. National consultation meetings, involving relevant stakeholders, are needed to develop national ethical frameworks for good governance in medicines registration, selection and procurement. When the national ethical frameworks are developed and adopted, implementation should commence, with advocacy playing an important role and thus being initiated at the start. Ideally, this biregional workshop could be replicated at the national level. Mechanisms need to be created or identified at national level for promoting an ethical framework for good governance in medicines registration, selection and procurement, among others, such as a mechanism to prevent conflict of interest and a mechanism for education and advocacy to relevant professionals.

(5)

(6)

ANNEX I

LIST OF PARTICIPANTS, OBSERVERS, CONSULTANTS, TEMPORARY ADVISERS AND SECRETARIAT

1. PARTICIPANTS - WPR CAMBODIA Dr TeKuyseang, Director-General for Administration and Finance, Ministry of Health, 151-153 Kampuchea Krom Rd. Phnom Penh, Cambodia, Tel No.: 85523 724033 Fax No.: 85523426024, Email: kuyseangte@yahoo.com Prof Sim Buth Sakun, Deputy Chief, Bureau of Food and Drug Registration, Department of Drugs and Food, Ministry of Health 151-153 Kampuchea Krom Rd., Phnom Penh, Cambodia Tel. No.: 85523 880267-68, E-mail: moh-cpn@forum.org.kh LAO PEOPLE'S DEMOCRATIC REPUBLIC Dr Lamphone Syhakhang, Chief of Drug Control Division, Food and Drug Department, Ministry of Health, Vientiane, Lao People's Democratic Republic, Tel No.: 85621214013114 Fax No.: 85621214015, Email: drugetrl@laotel.com Mr Phathanou Luangkay, Procurement Official, Medical Products Supply Center, Ministry of Health, Vientiane, Lao People's Democratic Republic, Tel No.: 85621212280 Fax No.: 856212163345, Email: phanthanou05@hotmail.com Mrs Noorizam bt. Ibrahim, Principal Assistant Director, National Pharmaceutical Control Bureau, Ministry of Health Malaysia P.O. Box 319, 46730 Petaling Jaya, Selangor Darul Ehsan Malaysia, Email: ni@bpfkgov.my Miss Noraini bt. Shaari, Executive Officer, Procurement and Privatization Division, Ministry of Health Malaysia Level 8 & 11, Bangunan PERKIM, Jalan Ipoh 51200 Kuala Lumpur, Malaysia Email: noranisha200@yajoo.com MONGOLIA Ms Uranchimeg Damba, Officer-in-charge of Medicine Promotion and Information, National Centre of Health Development, Enkhtaivan Street 13 b, Sukhbaatar District, Ulaanbaatar 210648, Mongolia, Tel No.: 976 II 328889, Email: d_uchimeg@yahoo.com Ms Zuzaan Zulzaga, Officer-in-charge in Drug Registration, National Centre of Health Development, Enkhtaivan Street 13b, Sukhbaatar District, Ulaanbaatar 210648, Mongolia Tel No.: 976 11 328801, Email: zzulzaga@yahoo.com

MALAYSIA

PHILIPPINES

Ms Concepcion S. Liberan, Supply Officer IV, Procurement Division, Procurement and Logistics Service (PLS), Department of Health, San Lazaro Compund, Sta. Cruz, 1003 Manila. Philippines, Tel. No.: 632743 8301 local 1304, Fax No.: 632781 8843, Email: csliberan@co.doh.gov.ph.coneLsl@yahoo.com Ms Mary Keurih, Acting Principal Advisor, Quality Assurance Licensing and Registration of Medicines), Medical Supplies Branch, National Department of Health, P.O. Box 807, Waigani, Papua New Guinea, Tel No.: 6753013620, Fax No.: 675 3231631, Email: medsupplies@health.gov.pg Ms Philomina Aufe, Pharmacist, Drug Information, Medical Supplies Branch, National Department of Health, P.O. Box 807 Waigani, Papua New Guinea, Tel No.: 6753013620 Fax No.: 6753231631, Email: medsupplies@health.gov.pg

PAPUA NEW GUINEA

VIETNAM

Ms Nguyen Thi Ngoc Bao, Expert, Planning and Finance Department, Ministry of Health, 138A Giangvo Street, Hanoi, Viet Nam, Tel No.: 8448464416 ext. 333 Ms Tran Thi Phuong, Head of Financing Division, Drug Administration of Viet Nam, 138A Giangvo Street, Hanoi Viet Nam, Tel. No.: 84448459668

2. PARTICIPANTS-SEAR INDONESIA Dr Engko Sosialine, Staff Member of National Committee on Drug Evaluation, The National Agency of Drug and Food Control, R.I., Jakarta, Indonesia, Tel: 62-21-424 ext 111 Fax: 62-21-4243605, Email: engkosm@yahoo.com Dr Zaenal Komar, Head, Sub-Directorate of Drug Supply Management, DIG of Pharmaceutical Service and Medical Devices, Ministry of Health, R.I., Jakarta, Indonesia Fax: 62-21-521 4872, E:mail: zeinalk@yhaoo.com

THAILAND

Dr Sirinart Vasanavathana, Senior Pharmacist, Division of Drug Control, Office of Food and Drug Administration, Ministry of Public Health, Thailand, Tel: 662-590 7155, Fax: 662-5907156 Email: vasana@health.moph.go.th Dr Chanvit Tharathep, Director, Bureau of Health Service System Development, Department of Health Service Support, Ministry of Public Health, Thailand, Tel: 662-590 1761, Fax: 662-590 8587 Email: chanvit@health.moph.gov.th )

)

! j

3. OBSERVERS MINISTRY OF HEALTH MALAYSIA Mrs Mahani bt. Mahmud, Pharmaceutical Services Division, Ministry of Health Malaysia, lalan Universiti, 46350 Petaling laya, Selangor Darul Ehsan, Malaysia, Tel No.: 603 79682224 Fax No.: 603796822222. Email: mahani@moh.gov.my Mrs Rosminah Mohd.Din, Pharmaceutical Services Division, Ministry of Health Malaysia, lalan Universiti, 46350 Petaling Jaya, Selangor Darul Ehsan, Malaysia, Tel No.: 603 79682219 Fax No.: 603 796822222, Email: rosminah@moh.gov.my

4. CONSULT ANT Dr Eloy Anello, National Director, Andean Centre of Excellence for Teacher Training, Universidad Nur-USAID, Santa Cruz, Bolivia, Tel No.: 591 3 363939, Fax No.: 591 3 331850 Email: eloy@nur.edu Ms Nazarita Lanuza, Chief Regulation Division 1, Food and Drug Regulation Officer V, Bureau of Food and Drugs, Department of Health, Civic Drive, Filinvest Corporate City, Alabang, MuntinlllPli City, Metro Manila, Tel No.: 6328070725/6328078275, Fax No.: 6328070751 Email: ntlanuza@bfad.gov.ph

5. TEMPORARY ADVISERS Dr Chanthanom Manithip, Department of Pharmacy, Faculty of Medical Sciences, National University of Laos, P.O. Box 7444, Vientiane, Tel No.: 85621222883, Fax No.: 856 21214055 Email: manithip@yahoo.com Dr Kongkeo Chounlamountry, Senior Lecturer, School of Public Health, National Institute of Public Health, Vientiane Tel No.: 856 21250670, Fax No.:856 21212412 Email: Kpharm_9@yahoo.com Prof Dr Abu Bakar Abdul Majeed, Dean, Fakulti Farmasi Bangunan Menara Berkembar, Sains dan Teknologi, Universiti Teknologi MARA, Aras 10, Blok 5, 40450 Shah Alam, Selangor Darul Ehsan, Tel No.: 603 55442727, Fax No.: 603 55442725 Email: abubakar@salam.uitm.edu.my

Dr Salmah Bahri, National Poison Centre, No. 25, Jalan Desa 2, Taman Desa, Sg. Abong, 84000 MUAR, Johor, Universiti Sa ins Malaysia, 11800 Minden, Penang Tel No.:6012 6812955/606 9528288 Fax No.: 606 951 OS 18 1 606 9528288 Email: salmahbahri@hotrnail.com.eesaI58@yahoo.com ProfMa. Lourdes G. Rebullida, University of the Philippines Center for Integrative and Development Studies, Basement, Bahay ng Alumni Bldg., u.P. Diliman, Ouezon City Tel No.: 632 929 3540 1924 4875 Fax No.: 6326975702/9293540 Email: mlrebuIlida@yahoo.com Ms Ma. Caroline Belisario, Technical Support Officer, Procurement Watch, Unit 2507, Medical Plaza Ortigas Condominium, San Miguel Avenue, Pasig City Tel No.: 632 687 4251, Fax No.: 6326339601 Email: crbelisario@yahoo.com.crb@procurementwatch.org.ph Dr N iyada Kiatying-Angsulee, Faculty of Pharmaceutical Sciences, Chulalongkor University, Bangkok 10330 Tel No.: 6622188443, Fax No.: 662 2188443 Email: niyada.k@chula.ac.th Mrs Wipada Sfipratetn, Consultant on Quant)' System Tel No.: 6624680043/6624494442, Fax No.: 662 6776371 Email: wipadasriprateth@hotmail.com Dr Rahmat Awang, Director of National Poison Centre WHO CoIIaborating Centre on Drug Information, Universiti Sains Malaysia, 1 1800 Minden, Penang, Malaysia Email: rahmat@usm.my 6. SECRETARIAT WHOIHQ

Dr Eshetu Wondemagegnehu, Technical Officer and Focal Person for Counterfeit Drugs, Quality Assurance and Safety of Medicines The World Health Organization, Headquarters Office in Geneva, Avenue Appia 20, Ch-l2I I Geneva 27, Switzerland Tel No.: +41227913743, Fax No.: +41 22791 4730 Email: wondemagegnehue@who.int Dr Guitelle Baghdadi, World Health Organization, Headquarters Office in Geneva, Avenue Appia 20, CH-121 1 Geneva 27 Switzerland, Tel No.: +41 227912989, Fax No.: +41227914730 Email: Baghdadig@who.int

WHOIWPRO

Dr Budiono Santoso, Regional Adviser in Pharmaceuticals World Health Organization Western Pacific Regional Office P.O. Box 2932, 1000 Manila, Philippines Tel No.: 632 5289846; 5208001, Fax No.: 6325260279; 5211036 E-mail: santosob@wpro.who.int Mr Jun Yoshida, Technical Officer, Pharmaceuticals World Health Organization Western Pacific Regional Office P.O. Box 2932, 1000 Manila, Philippines, Tel No.: 6325289882, Fax No.: 632 521 1036, Email: yoshidaj@wpro.who.int Ms Vanchinsuren Lkhagvadorj, Short-term Professional, Pharmaceuticals, World Health Organization Western Pacific Regional Office, P.O. Box 2932, 1000 Manila, Philippines Tel No.: 632 5289916, Fax No.: 632 5281036 Email: lkhagvadorjv@wpro.who.int

ANNEX 2

AGENDA I. 2. 3. Opening ceremony Introduction: meeting objectives and methodology Promoting ethical practices in medicines selection, registratio~ and procurement

WHOIAusAID collaborative project "Fighting corruption through ethical medicines registration and procurement" 4.

Corruption in the pharmaceutical sector Good practices on medicines: - Selection - Registration - Procurement

5.

6.

Working in groups Strength, weaknesses, opportunities and threats analysis for each country and plenary discussion

7.

Presentation of country assessment (Lao People's Democratic Republic, Malaysia, Philippines and Thailand)

8. 9.

Review and feedback on assessment tool An ethical framework for the pharmaceutical sector: why it is needed and how to develop it

9.1

Guide for development of general principles for an ethical framework in the pharmaceutical sector - Three working groups: - Selection - Registration - Procurement

9.2

Plenary discussion on ethical framework

10.

Development of national plans of action for promoting ethical practices in medicines registration and procurement (introduction) 10.1 Group work on development of national plans Points to discuss: - Most critical issues to address - Recommendations for action to Ministry of Health - Next assessment 10.2 Presentation of preliminary national plans of action

II. 12.

Conclusions Closing

TIMETABLE TIME 0800 Tuesday, 3 I May Registration Time 0830 Wednesday, I June 9, An ethical framework for the pharmaceutical sector: why it is needed and how to develop it (Dr Eloy An¢1I0, Universidad Nur-USAID) 9. I Guide for development of general principles fpr an ethical framework in the pharmaceutical sector (Dr Eloy Anello~ Universidad Nur-USAID) Time 0830

Thursday, 2 June 10. Development of national plans of action for promoting ethical practices in medicines registration and procurement (introduction) 10. I Group work on development of national plans Points to discuss:

I. Opening ceremony

• • • 0900 0930 Coffee break 2. Introduction: meeting objectives and methodology 3. Promoting ethical practices in medicines registration, selection and procurement (Dr Budiono Santoso, WHO/WPRO) 1000 1030 Coffee break - 'nuee working groups: - Selection - Registration - Procurement 1000 1030

Most critical issues to address Recommendations for action to Ministry of Health Next assessment

Coffee break 10.2 Presentation of preliminary national plans of action II. Conclusions 12. Closing

•

WHOI AusAlD collaborative project "Fighting corruption through ethical medicines registration and procurement" (Dr Budiono Santoso, WHO/WPRO)

4. Corruption in the pharmaceutical sector (Dr Guitelle Baghdadi, WHOIHQ)) 5. Good practices on medicines: • Registration (Mr Jun Yoshida, WHOWPRO) • Selection (Dr Guitelle Baghdadi, WHOIHQ) • Procurement (Ms Lkhagvadorj Vanchinsuren, WHO/WPRO) 6. Working in groups - Strengths, weaknesses, opportunities and threats analysis for each cOllntry and plenary discussion

.

:z z ~ w

1230 1400

LUNC H BREA K 7. Presentation of country assessment 1400 9.2 Plenary discussion on ethical framework I

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LaoPDR Malaysia Thailand Philippines Coffee break 1500 1530

Coffee break Plenary discussion on ethical framework (contd)

Presentation of country assessment and plenary discussion (contd) 8. Review and feedback on assessment tool

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ANNEX 4

IMPROVING TRANSPARENCY IN THE PHARMACEUTICAL SYSTEM BACKGROUND MATERIAL & SELECTED INDICATORS

Working draft 8 December 2004

Informal Preparatory Workshop for the Country Assessment of Practices in Medicines Registration and Procurement Manila, 25-26 November 2004

World Health Organization Essential Drugs and Medicines Policy

Prepared by:

Jillian Clare Cohen, PhD, Director, Comparative Program on Health and Society and Assistant Professor Leslie Dan Faculty of Pharmacy, University of Toronto and Guitelle Baghdadi, Essential Drugs and Medicines Policy

Acknowledgement We are grateful to the Australian Agency for International Development (AusAID) for their generous contribution to this project; to Mr Eshetu Wondemagegnehu (Essential Drugs and Medkines fu1icy, WHO/HQ), DF IJudiono Santtlso (Regional Adviser, WHO/WPRO) and Dr Krisantha Weerasuriya (Regional Adviser, WHO/SEARO) for reviewing the document; and to Ms Monique Renevier (Essential Drugs and Medicines Policy, WHOJHQ) for the layout.

Table of contents Introduction ............................................................................................................................................... 1 Background and rationale ................................................................................................................... 1 Who are the key informants and what are key informant interviews? ......................................... 2 Identifying lack of transparency and/or corru ption ........................................................................ 2 Coding and interpretation guidelines key ........................................................................................ 3 Section 1: Drug registration .................................................................................................................... 5 Section 2: Drug selection ....................................................................................................................... 15 Section 3: Procurement of pharmaceuticals ....................................................................................... 23 Questionnaire .......................................................................................................................................... 32 Drug registration ................................................................................................................................ 32 Drug selection ..................................................................................................................................... 35 Procurement of pharmaceuticals ...................................................................................................... 37 Selected readings .................................................................................................................................... 40 To do list for data collectors ................................................................................................................. 42 Model letter to send to key informants requesting interview ....................................................... 44

Introduction

Introduction Background and rationale Pharmaceuticals are indispensable to health systems; they can complement other types of health care services to reduce morbidity and mortality rates and enhance quality of life at the systems level. From an individual point of view, pharmaceuticals make us feel better when we are sick by either treating existing health conditions or help us when we are well by preventing conditions from happening. Pharmaceuticals, if used appropriately, thus have the power to make our lives better and longer. As pharmaceuticals have curative and therapeutic qualities, they cannot be considered as simply ordinary goods. Accordingly, access to vital and good quality medicines, is increasingly being viewed as a basic human right. Despite the importance of pharmaceuticals for health outcomes, there are glaring medicine gaps globally. WHO notes that as much as one-third of the global population lack regular medicines access and in some parts of Africa and Asia, these numbers are even greaterl . There are a number of determinants that contribute to this appalling medicine gap. These include poverty, market failures, and government failures. The latter failure can include a lack of transparency in the pharmaceutical system -one of the possible reasons for the medicine gap. The importance of transparency in the pharmaceutical system is becoming increasingly an issue of concern because bad practices in the pharmaceutical system can mean wasted resources, which in tum impacts on the availability of essential medicines. The below is a series of questions which can help determine the level of transparency present in a pharmaceutical system at various decision points: registration, selection and procurement. These questions can be tailored to fit particular circumstances. Some or all of them can be posed to a given key informant. At least ten key informants should be interviewed at each decision point so that sufficient data can be compared and confirmed where possible. The key informants should consist of persons who are at both the senior and more junior levels. They do not necessarily have to only be persons who are directly involved in the pharmaceutical system. It is helpful to have crosschecks from other key informants in other areas - such as finance, the non-governmental organization community, and the judiciary and media representatives. If appropriate, representatives from the private sector, the government, and the non-governmental organizations should be interviewed for each decision point. Furthermore, the greater the number the better, as that way, answers can be compared for consistencies. It is critical that before setting up a meeting with a government official, there is clear "buy-in" from the relevant political officials. This involves some initial groundwork before launching the interview process. It will involve briefing senior level officials in

Brundtland, 2000. Speech to the WHO/public Interest NGO Pharmaceuticals Roundtable, Third Meeting, Geneva, May 1, 2000 1

Improving transparency in the pharmaceutical system

the Ministry of Health ideally even the Minister of Health and other relevant institutions. Clear support should be sought by way of an official letter, which sanctions the interview process and encourages officials to participate in the process. This may encourage participants to be more open to meetings and to be more forthcoming during the interview process. All participants must be informed about the objectives of the exercise and very importantly assured of the confidentiality of their responses. What is more, questions must be posed in a non-threatening manner. The point of the exercises is to determine institutional weaknesses and strengths in the pharmaceutical system so the appropriate follow-up action can be taken. The effective functioning of a pharmaceutical system is dependent on transparency and effectiveness of each one of the decision points, which comprise the system in its entirety. (These indicators as noted earlier are based on those used in the study "Improving Transparency in the Pharmaceutical System: the Case of Costa Rica 2 .")

Who are the key informants and what are key informant interviews? Key informants are persons who have a "stake" or interest in the pharmaceutical system. They can be government officials, representatives from the private sector, patients, media, or other relevant persons. Key informant interviews are qualitative, indepth interviews of minimum 30 persons who are chosen for their first-hand knowledge about a subject. For this exercise, we recommend that you interview at least ten persons for each decision point (registration, selection and procurement) and therefore a minimum of 30 persons in total. The interviews should be loosely structured and are based on a list of issues to be discussed. The method provides information directly from knowledgeable persons; is flexible insofar that it can explore new ideas; and the interviews are mainly inexpensive to conduct. When conducting these interviews, persons will be targeted for their knowledge of the issues and/or their level of involvement in the pharmaceutical system. The following is a suggested list of contacts for key informant interviews: Ministry of Health, Ministry of Finance, international pharmaceutical industry, local pharmaceutical industry, nongovernmental organizations, and international organizations.

Identifying lack of transparency and/or corruption Identifying corrupt practices in the pharmaceutical system can be difficult for a number of reasons. For one, corruption can be disguised by inefficiencies. Second, persons who are being interviewed may be reluctant to admit corruption exists because of fear of punishment or shame. Third, corruption oftentimes is hard to document and thus prove. Knowing the above, we have designed a series of questions to pose to key informants that can help reveal institutional weaknesses in the pharmaceutical system and therefore practices that may be susceptible to corruption. The point of these questions is to confirm what practices are working well and those that could benefit from reform. The questions are not designed to indict anyone. And, even evidence of Jillian Clare Cohen, James Cercone, Ramon Macaya (2002) "Improving Transparency in the Pharmaceutical System: the Case of Costa Rica" World Bank study, unpublished. 2

Introduction

corruption in one area may not confirm that corruption is in all areas of the pharmaceutical. Moreover, be mindful that the indicators are not unequivocal signs of corruption. However, they can be used as "signals" to help policy makers detect if and where there may be corruption in the pharmaceutical system so that further investigation can take place or remedial actions can be implemented.

Coding and interpretation guidelines key In order to minimize the subjective interpretation of respondents' answers, each indicator is formulated to require a binary answer (yes/no). Further, interviewers must request documents from key informants in order to validate responses that are postive. Criteria are included to assist interviewers to determine what would constitute objective validation of a positive response. (See interpretation guidelines and table at end of this document). In this methodology, a "yes" is given a value of one (1) and a "no" is given a value of zero (0). A value of one (1) represents low vulnerability to corruption (so long as it is supported by the existence of publicly-available document that describes the process or decision criteria). On the other hand, a rating of zero (0) represents high vulnerability to corruption since the absence of a standardized process or decision criteria provides decision makers with broad discretion in their decision making. Once all interviews are completed and all indicators are rated according to the criteria, an average rating should be calculated for the questions addressing each decision point (Selection, Registration and Procurement). The average rating has it possible ra.nge from zero to one. The sum of all the ratings of one (1) is then divided by the number of questions in a given decision point to obtain the percent of the indicators that were rated as one. The resulting percentage is then converted to a zero to ten (1.0 to 10.0) scale by multiplying the resulting percentage by ten (10). y!e will give an example below to clarify this: Example: If there are sixteen indicators related to Drug Registration and nine receive a rating of one (1), and the other seven receive a rating of zero (0), then the percent receiving a rating of one would be as follows: 1.

2. 3.

9/16 = 0.56 We then multiply the value of 0.56 x 100 % = 56%. This would then be converted into a ten point scale by multiplying 56% time a possible rating of ten (10) = 56% x 10.0 = 5.6

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Improving transparency in the pharmaceutical system

The ten point rating system then represents the following degrees of vulnerability to corruption: 0.0 -2.0 2.1-4.1 4.1-6.0 6.1-8.0 8.1-10.0

Extremely vulnerable

Very vulnerable

Moderately vulnerable

Marginally vulnerable

Minimally vulnerable

We convert the average rating of binary responses to individual questions to a tenpoint scale for the group average because we want to analyze and compare the degree of susceptibility to corruption among the different decision points as well as between decision points in different health care systems. (This methodology may be complemented in time with other methods such as surveys and focus groups.)

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Drug registration

Section 1: Drug registration Indicator 1: Does the drug registration process have an information system? Rationale: A drug registration information system with accurate and current information can help indicate how transparent the government is about the pharmaceutical products in its markets. In this case, it measures the degree to which a government protects its population from products of uncertified quality and effects.

Description: There should be an official registration (licensing or marketing) of products approved for sale or distribution in the country. Drugs not listed on the official register are considered as non-registered and should not be available in the market for sale. Drug registration must be based on an objective assessment of a drug's efficacy, safety, quality and truth in packaging. The indicator is applicable to all pharmaceutical drug products identified in national legislation as requiring registration. The drug registration system can be described as: manual, computerized, mixed if one exists. Alternatively, there may be no registration system in place. If it is a sound system, it should be dynamic and include the name and contact information of the company registering the drug, the name of the manufacturing company, if applicable, the country where the product was manufactured, when it was registered, and complete product description. Interpretation Guidelines: If the registration system fulfills the criteria above, then it should receive a rating of one: the lowest likelihood of corruption. This rating needs to be backed up by evidence that the information system is in place. If there is partial information available or if only parts of the above criteria are fulfilled, then it should be rated a zero, which indicates a greater likelihood of corruption.

Indicator 2: Are there written procedures on how to register a drug in the market for applicants and for assessors? Rationale: Consistent and open procedures for drug registration for all drug manufacturers and suppliers are critical for a transparent pharmaceutical system. This ensures that decision-making is based on objective criteria and not on subjectivity.

Description: The written procedures must be clear and describe comprehensively and cogently the processes, fees, and authorities involved in the drug registration process. It should be readily available to any interested supplier or manufacturer and its application must be uniform. 5

Improving transparency in the pharmaceutical system

Interpretation Guidelines: If the written procedures are comprehensive, consistent, and easily accessible, this indicator should receive a rating of one (again, please ensure there is documentation to support this rating). If the written procedures seem partially incomplete or there are no documents available or if the documents are inconsistent, incomplete and difficult to access, then this indicator should be rated a zero.

Indicator 3: Is there a standard application form?

Rationale: A standard application form is a measure of even registration standards. It suggests that drug products are evaluated on objective criteria and are applied

uniformly irrespective of the supplier or manufacturer. This is important to ensure fair market access. Description: The document should include the product name and the manufacturer. It may be expanded to include the nonproprietary names for active substances, composition (including active ingredients), pharmacological action, therapeutic classification, and claims made in the packaging insert. Interpretation Guidelines: If the application form is comprehensive, containing the information listed above and applied uniformly, then this indicator would be rated a one (please ensure you have a copy of the application form or know what website it is posted on). If there are no standardized forms or there is no evidence of a form, this indicator should receive a rating of zero.

Indicator 4: Is this document publicly available and easy to access?

Rationale: There is often a wide gap between pharmaceutical regulation and policy and how it is implemented. This indicator is examining whether the document is readily available. If affirmative, it suggests that the policy is being implemented in practice. Description: The drug registration form should be readily available through a government website or through government offices so that suppliers and manufacturers are able to access it with ease and its criteria are transparent. Interpretation Guidelines: If the document is easily obtainable, through a website or a government office, for example, or if the document can be found with some minor effort, then this indicator should be rated a one. If the document is difficult to find or there is no evidence of this document, this indicator should be rated at zero.

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Indicator 5: Is there a formal committee responsible for drug registration? If yes, what criteria are used for selecting members to the committee? Rationale: If a country has a well-developed pharmaceutical system, the presence

of a formal committee that is responsible for the drug registration may help ensure transparency in the drug registration process if the committee membership is selected according to their appropriate technical qualifications and the basis of their decision-making is scrutinized. If a country is at an unsophisticated level of pharmaceutical supply and drug registration is more limited to the notification procedure whereby standard information is obtained on all pharmaceutical products offered for sale in the country and entered into a register and no judgment is made regarding the appropriateness of the drugs for sale in the country, then the existence of such a formal committee is less important. Description: The drug committee should be composed of experts (with qualifications which back up their expertise) and ideally not be filled by political appointees. This committee should be impartial and ensure that the drugs listed in the national register are assessed for efficacy, safety, quality, truth, and completeness of packaging information. The latter is a basic procedure. At a more advanced stage, the committee should examine individual products by examining detailed data from the manufacturer and literature to assess the quality, safety, and efficacy of a product. Finally, the committee should also ensure that older drugs in the market are systematically reassessed. Interpretation Guidelines: If the drug committee is formally established, composed of professionals with the requisite technical skills (with supporting evidence that backs up their skill-set), and meets on a regular basis, then this indicator should be rated at a one. If the committee exists but does not meet regularly and is composed of questionable members, then this indicator should be rated at zero. If committee formation is not formalized, then this indicator should receive a zero.

Indicator 6: Is there an organigram that describes the composition of the committee available as a public document?

Rationale: A basic organigram that describes the committee membership roles and responsibilities helps ensure transparency in the drug registration process. Description: The organigram should list committee member by name and their expertise. This document should be publicly available. Interpretation Guidelines: If the organigram is up to date, clear, and in the public domain, this indicator should be rated at a one. If there is an organigram but it is difficult to read and/or not current or if there is no evidence of an organigram, this indicator should receive a zero.

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Indicator 7: Is the committee responsible for decision-making or does it act in an advisory capacity?

Rationale: This indicator will help determine to some degree whether the committee is a formality or whether it exercises influence on the drug registration process. If the committee is only advising a Minister or another official, then its decisions can easily be over-turned and thus the likelihood of subjective decisionmaking is greater Description: If the committee is well designed, transparent, operates with the right policies and procedures, and members who are impartial and technically-sound, then if its decisions are influential or binding, there is a much greater likelihood of best practices. Interpretation Guidelines: If the committee acts in advisory capacity and there is evidence that its decisions are easily over-turned, this indicator should be ranked at zero. If the Committee exercises real decision-making practices and there is evidence to support the fact that committee decision-making is respected, this indicator should receive a one.

Indicator 8: Does the committee provide an official written report for all decisions (e.g. accepted and rejected files)?

Rationale: The committee should provide an official written report on the results of the drug evaluation, whether the product is accepted or rejected relating to the standardized reasons of safety, efficacy and quality evaluation to manufacturers/suppliers. This procedure discourages inappropriate action on the part of the committee and allows suppliers and manufacturers to appeal decisions, if necessary. The review process, moreover, should be done on a timely basis and not vary greatly from submission to submission. These reports should be available publicly if requested. Description: A file should be accepted because the drug demonstrates accepted quality, efficacy, safety and oftentimes cost-effectiveness. The conditions of rejecting an application can be one of the following: the medical product is harmful in the normal conditions of use; its therapeutic efficacy is lacking or is insufficiently substantiated by the applicant, or its qualitative and quantitative composition is not as declared. Interpretation Guidelines: If the committee provides clear explanations based on objective criteria and in a written format, then this indicator should receive a one. If the reasons for acceptance or rejection are not thoroughly provided, this indicator should receive a zero. If no written explanations are provided for accepted and rejected files, this indicator should receive a zero.

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Drug registration

Indicator 9: Do terms of reference exist which describe the purpose of the committee, its processes, duration etc.? And, if so, are these available publicly? Description: To help ensure transparency, fairness and consistency in the registration process, the committee should be operating under clear terms of reference (TORs). These TORS should describe the mandate of the committee, the number of meetings it should convene and when, the reporting structure, its duration etc.

Rationale: The registration committee needs to be functioning according to standards rules and procedures. Moreover, it should not be an ad-hoc committee but one that is fully established as a governmental institution. These terms of reference are crucial for helping to ensure the good governance of the committee. Interpretation Guidelines: If terms of reference exist, are publicly available and are comprehensive, this indicator should receive a one. If terms of reference are available but difficult to access and are not sufficiently comprehensive or there are no terms of reference available or they are sufficiently vague, this indicator should receive a zero.

Indicator 10: How does the committee reach its decisions (for example, is a qualified

majority required, cOnsenslls etc.)? Are these procedures documented? Description: The decision making process needs to be examined for fairness and

clear rule application. Rationale: This question probes the internal workings of the committee to examine if it is operating with good governance techniques. After decisions are reached, it is important to determine how they are passed. Does voting take place at all? Is voting subject to certain rules, such as consensus, majority or qualified majority? What procedures are in place if agreements or majorities cannot be reached? This will help the assessor determine if decisions are made thoughtfully and constructively or arbitrarily. Interpretation Guidelines: If decision-making procedures are available in written format and are detailed, this indicator should receive a one. If decision-making procedures are not available in written format but are detailed by the key informant, this indicator should receive a one if and only if what is described can be corroborated by further interviews. If decision-making procedures are vague and there is no written format, this indicator should receive a zero.

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Improving transparency in the pharmaceutical system

Indicator 11: Are members of the committee or any other officials involved in the medicine registration process formally required to declare any conflict of interest

Description: Given the potential for conflict of interest that could influence decision-making in the drug registration process, members of the committee or public officials involved in drug registration processes, should be obliged to declare any potential conflict of interest that could arise in their professional responsibilities. Rationale: This question helps to illuminate what checks exist to deal with potential conflict of issues. The statement should be a standardized form that all parties concerned are obliged to sign. The template should be publicly available, if requested. Interpretation Guidelines: If there is a standardized form that all parties sign and it is readily available, when requested, this answer should receive a one. If there is an apparent process to deal with conflict of interest but there is no document to support this, then this answer should receive a zero. If there are uncertain answers to the question or an outright no, this answer should accordingly receive a zero.

Indicator 12: Is there an appeal process for applicants that have their drug applications rejected?

Description: A formal appeal process in the registration process can promote honest behaviour on the parts of the governments. Description: A formal appeal process or a protest mechanism should be available to manage concerns and complaints from firms. Following communication of decisions, firms should be able to file protests based on their view that they were unfairly evaluated and provide reasons and/or supplementary documents, which support the request for a second evaluation. Interpretation Guidelines: If there is a protest mechanism in operation and there is evidence of its use, then this indicator should receive a rating of one. If there is a protest mechanism in place but there is little evidence that it is used, then this indicator should receive a rating of zero. If there is no protest mechanism to speak of, this indicator should receive a rating of zero as well.

Indicator 13: Have there been drug recalls in the past 3 years?

Description: This indicator will record the number of registered drugs that have been recalled off the market and include the rationale put forward from information provided by drug registration staff, the registration information system or other sources.

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Drug registration

Rationale: This question aims to see if the drug institutions are doing their job effectively and whether reasons for rejection are formally reported. Recalls may not indicate transparency or problems concerning transparency but can demonstrate institutional effectiveness. Interpretation Guidelines: If there are clear examples of drug recalls with solid explanations, this indicator should receive a rating of a one. If there is no evidence of drug recalls this indicator should receive a zero. However, if there is no evidence of drug recalls and a reasonable justification given, this indicator should be ranked at one. This question demands some prudent interpretation by the assessor.

Indicator 14: Are there formalized procedures to deal with reporting of drug safety and efficacy?

Rationale: Formalized procedures to monitor the safety and efficacy of pharmaceuticals in the market are critical responsibilities of the government and necessary to avert public health disasters. Description: This indicator will assess what drug safety measures are in place. This should include a drug information system, quality assurance systems, and appropriate administrative procedures. As with indicator 13, this indicator is testing government efficiency and institutional checks. Interpretation Guidelines: If there is a formal and comprehensive system in place to ensure drug safety and efficacy in the pharmaceutical market, then this indicator should be ranked a one. If there are some procedures in place but the system is not comprehensive, then this indicator should be ranked a zero. If there are poor or non-existent procedures evident, then this indicator should be ranked a zero.

Indicator 15: Who does the committee report to and is this person responsible for making the final deciSion-making?

Rationale: As noted earlier, it is important to determine the level of power that the committee has in the decision-making process. If the committee is only a formality and one person de facto holds responsibility for authorizing all drug registrations in the market, there is an obvious risk of corruption because there is no check on his or her authority. Description: The decision-making process should consist of a number of persons with sufficient checks and balances in place to ensure that decision-making is based on objective criteria that is publicly available. Interpretation Guidelines: If one person is responsible for the decision-making or there are non-transparent procedures in place, this indicator should be rated a zero. If there are clearly transparent and democratic processes for decision-making, this indicator should be rated a one. If the decision-making procedures seem not 11

Improving transparency in the pharmaceutical system

absolutely clear but there is evidence of fair processes, then this indicator should receive a one.

Indicator 16: Is the registration fee set by law or regulation and publicly available? Rationale: If a registration fee is set by law or regulation and publicly known, it lessens the risk of a public official increasing the fee for private gain. It also ensures

that the fee that is levied on suppliers is uniform. Description: Drug registration fees should be a national policy/legislative decision. The drug registration fee should be publicly available through a government website or printed on a registration document. The fee schedule should be standardized. Interpretation Guidelines: If the registration fee is clearly stated on a public document (e.g. law or regulation) this indicator should receive a one. If the registration fee is set officially but accessing fee information is difficult or demands effort, this indicator should receive a one if the information is obtainable eventually. If there is no evidence of public information about drug registration fees and/or there is evidence of haphazard application of fees, this indicator should receive a zero.

Indicator 17: Is the time from application to decision-making uniform from application to application?

Rationale: Even if a drug regulatory authority takes a lengthy period of time from the time of the application submission to actual market entry, if it is consistent across all applications, this likely indicates inefficiency rather than unethical behaviour on the part of government officials. Inconsistent time periods, however, for drug registration may indicate non-ethical behaviour on the part of the government officials. Description: The length of time between filing of an application to market entry depends on a number of factors such as the need for additional data/documents for medicine evaluation during the registration process, problems associated with importation and production etc. Keeping the aforementioned in mind, there still should be an average amount of time it takes for a drug to be registered in the market should be available through the government agency that is responsible for the drug registration. This average time should be checked against a sample of manufacturers and suppliers who have recently had a product registered in the market. Interpretation Guidelines: If the average time for drug registration is consistent across the sample, then this indicator should receive a rating of a one. If there is seemingly some variation across registration times but it is not prevalent, then this indicator should receive a one so long as there is solid justification given. 12

Drug registration

However, if the sample indicates significant differences with regards to the timing of drug registration, then this indicator should receive a rating of zero.

Indicator 18: Are there drugs in the market that are non-registered?

Rationale: The number of unregistered drugs for sale in a market demonstrates the degree to which a government enforces its drug control policies and protects its population from uncertified products of uncertified quality and effect. High numbers of unregistered drugs suggest a regulatory agency that is not functioning effectively. This may be due to a lack of institutional capacity and/or human resources. It may also be a result of deliberate acts of omission. Description: This indicator measures how well drug registration regulations are being implemented. A product is considered officially registered when the drug is listed on an official register of products approved for sale or distribution in the country. Drugs not listed are considered as non-registered. Interpretation Guidelines: If there is no evidence of non-registered drugs in the market, this indicator should receive a rating of one. If there is some evidence of non-registered drugs, then this indicator should receive a rating of zero. If it is common for drugs to be non-registered, then this indicator should be rated a zero as well.

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14

Drug selection

Section 2: Drug selection Indicator 19: Does the government have a national essential medicines list?

Rationale: An essential medicines list, if used properly, can help ensure that drug expenditure is not wasted by the government on unnecessary drug products that may be promoted by suppliers to governments through the use of legal marketing strategies or illegal payoffs. Description: An essential medicines list is a published document that identifies those drugs determined by a national authority to be essential for key public health problems in a country and available through the public health system. It is a drug selection tool that, if prepared appropriately, can help governments purchase appropriate drugs for their population. Interpretation Guidelines: If there is evidence of an essential medicines list and it is current and well known/disseminated among government officials, then this indicator should receive a rating ef one. If it is out of date (not extremely Gut of date) but still well known among government officials, then this indicator should receive a rating of one. If there is no evidence of an essential medicines list, this indicator should receive a zero.

Indicator 20: Is the essential medicines list in line with WHO procedures?

Rationale: The Essential Medicines List (EML) should list pharmaceuticals by generic name that meet the basic health needs of the majority of the population and are cost-effective. The EML should serve as a framework for the country. Description: The principles and recommendations for developing and maintaining an EML have been set forth by the WHO. They include using generic names, avoiding combination products, etc. WHO produces a model list that countries make reference to; it is not expected that countries will adopt the model list. Interpretation Guidelines: If the EML is consistent with WHO principles, then this indicator should receive a rating of a one. If there is deviation with justification (based on real health needs), then this indicator should still receive a rating of one. If there are medicines on the list that seem somewhat inconsistent with the health needs, this indicator should receive a zero.

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Indicator 21: Is there evidence of clear written criteria for including and eliminating drugs from the EML?

Rationale: This indicator can help assess the transparency of the government's decision- making processes relating to the national drug formulary. Increased transparency of drug selection can help lessen the likelihood of collusion or payoffs for inclusion on the list and reduces the discretion of the committee members. Description: The government should have clear guidelines that specify what criteria are applied for drugs to be included on the national drug formulary. The inclusion of a new drug should be based on studies that confirm that the drug is necessary for the health needs of the population and ideally cost-effectiveness. This is particularly relevant for drugs that are not essential drugs. Equally important, the deletion of a drug from the national drug formulary should be based on sound evidence that the drug is inappropriate or not cost-effective for the health needs of the population. Interpretation Guidelines: If the rules for drug inclusion or elimination from the national drug formulary are based on sound criteria and available in written format, then this indicator should receive a rating of a one. If the rules for drug inclusion or elimination are available publicly but are based on unclear criteria, then this indicator should receive a rating of zero. If no criteria are available, then this indicator should receive a rating of zero.

Indicator 22: Is the inclusion of new products on the EML based on studies of costeffectiveness and health needs?

Rationale: This indicator helps to assess what criteria the government uses for the inclusion of new medicines on its EML and how transparent they are. Description: The government should have clear guidelines that specify what criteria are applied for medicines to be included on the EML. The inclusion of a new medicine should be based on studies that confirm that the medicine is necessary for the health needs of the population and ideally cost-effectiveness. Interpretation Guidelines: If the government has clear guidelines on the inclusion of new medicines on its EML and these guidelines are in the public domain, then this indicator should receive a rating of one. If there are guidelines but they are not in the public domain, then this indicator should receive a rating of zero. If there are no guidelines or they are out-dated, then this indicator should receive a rating of zero.

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Drug selection

Indicator 23: Is committee membership on the drug selection committee on a rotating basis or limited in time?

Rationale: Membership on the drug selection committee should be regularly changed to reduce the likelihood of biased decision- making. Description: The names of the individuals and agencies involved in determining the EML should be public information. The committee membership should be rotating or limited in time to reduce likelihood for systematic bias in the decision making process and to limit an individual's power and influence in drug registration decision making. Interpretation Guidelines: If committee membership is limited or rotating and there is public information about the terms of membership, then this indicator should receive a rating of one. If there is limited membership but there is no public information about its terms, then this indicator should receive a rating of one. If there is no process evident, this indicator should receive a zero.

Indicator 24: Are the decisions made by the selection committee publicly disseminated?

Rationale: Public information about the selection of medicines decision-making is necessary to lessen the likelihood of decisions that are not based on sound health and economic needs. Description: Public information about medicine selection should be easily accessible. The rationale for medicine selection should be clearly presented and backed up with the appropriate scientific and economic justifications. An information system that disseminates medicine decision-making criteria helps to ensure that if collusion takes place it is detectable. Interpretation Guidelines: If medicine selection processes and decisions are publicly available and widely disseminated in the public domain, then this indicator should receive a one. If the criteria are available but difficult to find, this indicator should receive a rating of one if they are eventually found. If the criteria are not available publicly or privately, this indicator should receive a rating of zero.

Indicator 25: Are generic medicines selected for the EML except in the cases when a generic substitute is not available?

Rationale: The selection of generic medicines is one measure of a country's efforts to ensure cost-effective products are used in the public health care system. The selection and use of generic medicines for a EML helps ensure clarity, quality, and cost-effectiveness. Generic medicines can be bought from multiple suppliers and are often cheaper than brand-name products.

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Description: Every medicine in the pharmaceutical market has an international nonproprietary name (INN) or generic name. The INN is the drug's official name irrespective of the manufacturer or marketing company. The EML should include the generic name. Interpretation Guidelines: If the EML uses generic medicines primarily unless there is no generic substitute available, then this indicator should be rated a one. If the EML lists some medicines by generic name and others by brand name, this indicator should be rated a one so long as there is a valid justification. If not, it should be rated a zero. If there are no generic names used, then this indicator should be rated a zero.

Indicator 26: Do terms of reference exist which describe the purpose of the selection committee, its processes, duration etc.? And, if so, are these available publicly?

Description: To help ensure transparency, fairness and consistency in the selection process (as indicated in the registration section above) the committee should be operating under clear terms of reference (TORs). These TORs should describe the mandate of the committee, the number of meetings it should convene and when, the reporting structure, its duration etc. Rationale: The selection committee needs to be functioning according to standard rules and procedures. Moreover, it should not be an ad-hoc committee but one that is fully established as a governmental institution. These terms of reference are crucial for helping to ensure the good governance of the committee. Interpretation Guidelines: If terms of reference exist, are publicly available and are comprehensive, this indicator should receive a one. If TORs are available but difficult to access and are not sufficiently comprehensive, this indicator should receive a zero. If there are no terms of reference available or they are sufficiently vague, this indicator should receive a zero.

Indicator 27: Are the criteria for committee membership publicly available?

Rationale: The criteria for committee membership should be publicly available to reduce the likelihood of inappropriate non-merit appointments and the risk of nepotism. Description: Committee membership should be based on clear criteria that ensure that recruitment is based on merit. This should enhance accountability and transparency so long as they are easy to obtain. Interpretation Guidelines: If the criteria for committee membership are clearly presented with detailed terms of reference for each position and publicly available, then this indicator should be rated a one. If the criteria for committee membership are as above but not available publicly, then this indicator should be rated a one 18

Drug selection

only if the documentation exists to support this rating. If there is no evidence of criteria, this indicator should receive a zero.

Indicator 28: Are there clear rules for decision-making for the committee decisions?

Rationale: This is another indicator to measure the amount of checks and balances, which are part of the medicine selection process. Description: The decision-making process for medicine selection should reflect the input from a number of individuals and not be made de facto by one person. Information should be obtained on the processes and procedures and individuals responsible for them at each stage of the drug selection process. Interpretation Guidelines: If one person is responsible for committee decisionmaking (e.g. a chair), then this indicator should receive a rating of a zero. If there are some processes which suggest some formal procedures for decision making, then this indicator should receive a one if there is document to support this rating. If committee decisions are made by clear decision rules that involve all members in a democratic manner, then this indicator should receive a one.

Indicator 29: Is there a law or regulation prohibiting members of the drug selection committee from accepting support in kind or in CaS" from pharmaceutical companies?

Rationale: This indicator measures the government's commitment to preventing potentially unethical behaviour on the part of public officials involved in the drug selection process. Description: The government should have a law that explicitly prevents public officials who are members of the medicine selection committee from accepting gifts in cash or kind from pharmaceutical companies. In most countries, bribery legislation is in the statute books. Such provisions are usually found in the penal code or in some cases there is special corruption legislation. Interpretation Guidelines: If there is a law in effect that prohibits members from the medicine selection committee accepting gifts in cash or kind, this indicator should receive a rating of one but only if there is evidence that the law is being implemented. If there is a law or regulation in place but no evidence of its effective implementation, this indicator should receive a zero. If there is no law or regulation, this indicator should receive a rating of one or a zero.

19

Improving transparency in the pharmaceutical system

Indicator 30: Is there a "declaration of conflict of interest" form that members of the selection committee are obliged to complete? Are there clear sanctions for breach of these regulations?

Rationale: This indicator determines if the government is trying to mitigate conflict of interest and measures a government's commitment to penalize public officials for behaviour which breaches the law by examining what provisions are in place for the latter. Description: The government should have a standardized "conflict of interest" form that is publicly available and expressed sanctions that indicate the type of penalties that are levied on a public official if she or he has breached the law. Interpretation Guidelines: If sanctions are in place and examples of the enforcement of these sanctions are provided, then this indicator should receive a rating of one. If there are sanctions in place but little evidence of enforcement, this indicator should be rated a zero (ideally, examples of specific cases and dates should be provided for this indicator to receive a one). If there are no sanctions then this indicator should receive a zero.

Indicator 31: Has any committee member worked in the past or is now working for the pharmaceutical industry?

Rationale: The potential for biased decision making is greater if a committee member has worked or is working for the pharmaceutical industry. Description: The committee members should not have any past or present linkages with the pharmaceutical industry, whether it is the local or international industry. Background checks on each member should be mandatory as a preventative measure against any potential conflict of interest. Interpretation Guidelines: If one or more committee members have or have had ties to the pharmaceutical industry, then this indicator should receive a rating of zero. If there is no evidence of any member having connections to the pharmaceutical industry, then this indicator should be ranked a one.

Indicator 32: Is there an independent drug agency that provides unbiased information?

Rationale: Drug selection should be based on impartial decision-making. To facilitate this, it is imperative that committee members have access to unbiased drug information from an independent body. Description: Committee members should base their decision making on unbiased information and evidence. Ideally, an independent drug information agency should provide information to the committee members. 20

Drug selection

Interpretation Guidelines: If there is evidence of a well functioning, independent drug information agency, that regularly supplies information to the government and the public, then this indicator should receive a one. If there is an independent drug information agency but the reach of its information dissemination is uncertain, then this indicator should receive a rating of zero. If there is no drug information agency or it is affiliated to a government agency, then this indicator should receive a rating of zero.

21

Improving transparency in the pharmaceutical system

22

Procurement of pharmaceuticals

Section 3: Procurement of pharmaceuticals Indicator 33: Are there competitive procedures for the procurement of pharmaceutical products?

Rationale: Competitive bidding is generally viewed as the best method for fair and efficient drug procurement. Competitive bidding for the procurement of pharmaceuticals can be international or limited to national bidders; it can be open or restricted to a limited number of bidders, sometimes on the basis of a prequalification system. Description: The types of competitive bidding procedures used must be appropriate, transparent, fair, and consistently applicable to the national law. If there are exceptions to the rule (e.g. for certain types of products), these must be fully justified and, in some cases, approved by a relevant government authority. To meet the criteria of competitiveness, pharmaceuticals must be purchased on the basis of sealed bids submitted in response to government requests to supply drugs. Interpretation Guidelines: If the procurement procedures are transparent and in line with international standards (for example, as per the Interagency Pharmaceutical Procurement Group's Operational Principles for Good Pharmaceutical Procurement 3) then this indicator should receive a rating of one. If procedures are characterized as competitive but there is no sound evidence to back this up, this indicator should receive a zero. If the procurement procedures are not transparent, then this indicator should receive a rating of a zero.

Indicator 34: Does the government use written procedures (prepared within the previous 5 years) for drug procurement?

Rationale: Written procurement procedures for drug procurement can help ensure that the process is open and transparent. This indicator assesses, moreover, whether the government is using procurement procedures that are not out-dated. Description: The government should have an explicit policy document that describes the procurement process for drugs clearly.

3

http://www. who.int!medicines/library!par!who-edm-par-1999-S/who-edm-par-99-S.shtml 23

Improving transparency in the pharmaceutical system

Interpretation Guidelines: If the government has written procedures for drug procurement that are clear and up to date, then this indicator should receive a rating of one. If there are clear procedures that are publicly available in place but they are out-dated, this indicator should receive a rating of one so long as there is evidence to support it. If there are none, this should be rated a zero.

Indicator 35: Are these written procedures publicly available?

Rationale: The procurement procedures should be publicly available to ensure that they are fair, equitable, and are open to scrutiny. Description: Publicly available procurement procedures help to strengthen the accountability of the procurement process. Information dissemination can also help counter collusion. The government's procurement procedures should be easily accessible to the public through a government website or office. Interpretation Guidelines: If the procurement procedures are easily accessible, then this indicator should receive a rating of one. If the procurement procedures are accessible, but not easily, this indicator should receive a rating of one nonetheless. If the procurement procedures are difficult to obtain publicly or if they are non-existent, this indicator should receive a rating of zero.

Is there a clear algorithm, based on utilization of services and health needs to determine quantity and type of pharmaceuticals purchased?

Rationale: To reduce the risk of oversupply, undersupply, or unnecessary supply of pharmaceuticals, drug purchases should be based on objective, actual or expected health needs. Use of an established methodology for estimating needs reduces vulnerability to unwarranted pressure from pharmaceutical suppliers to make drug purchases by government officials through the use of kickbacks and other types of payoffs. Description: There are four major methods for quantifying drug needs: consumption (based on historical data), morbidity based, adjusted consumption, and service-level projection. Ideally, a combination of these will be applied to obtain the most accurate estimates. Interpretation Guidelines: If the methodology for quantifying drug needs is well documented and based on objective criteria, as defined above, then the indicator should receive a rating of one. If there is a non-comprehensive model in place, this indicator should receive a zero. If there is no evidence of a model in use, this indicator should receive a zero.

24

Procurement of pharmaceuticals

Indicator 37: Is drug procurement based on the national essential medicine list or hospital formularies?

Rationale: This question will assess how well national essential medicines lists or hospital formularies are being implemented. DeSCription: Public drug procurement should be based on products listed on the national essential medicines list or on the hospital formulary. Interpretation Guidelines: If procurement documents demonstrate that they are consistent with the national essential medicines list or a hospital formulary, this indicator should receive a one. If there is some consistency between the drugs that are being procured and the lists, this indicator should receive a one. If there is no consistency or no documentation available, this indicator should receive a zero.

Indicator 38: Are there specific criteria for tender committee membership?

Rationale: The procurement committee should be comprised of members that are appointed for their professional expertise. Each committee member should be screened for honesty and integrity as part of the appointment process. Description: Drug procurement contracting typically involves large amounts of money so there is potential for unethical practices. The government should ensure that quality persons are involved in the procurement process by way of rigorous interviews and background checks. These members should have skills that complement each other. An oversight body should be responsible for monitoring the activities of the procurement committee. Interpretation Guidelines: If there are clear guidelines for membership on the procurement committee and some type of oversight mechanism, then this indicator should receive a one. If there are clear guidelines for membership but no oversight processes in place, then this indicator should receive a rating of zero. If there are no guidelines, this indicator should receive a zero.

Indicator 39: Is this membership permanent?

Rationale: Rotating membership helps deter and reduce opportunities for unwarranted influence on committee activities. If membership for the procurement committee is permanent, the likelihood for unethical behaviour increases because there is less oversight. Description: The committee membership should change periodically. The government should have a formal written procedure in place for the appointment of members to the procurement committee and for the replacement of members. Interpretation Guidelines: If the committee membership changes on a regular basis and there are clear procedures for the tenure of membership, then this 25

Improving transparency in the pharmaceutical system

indicator should receive a rating of a one. If committee membership changes on an ad hoc basis, then this indicator should receive a rating of one only if there is evidence of change often enough. If there is evidence of little change of committee membership, then this indicator should receive a rating of zero.

Indicator 40: Are the contract specifications publicly available and distributed with the tender documents?

Rationale: Any action that deviates from a standard practice of procurement may suggest corruption. Basic procurement principles require that bid evaluation criteria are specified in the bidding documents. Description: The contract specifications should include evaluation criteria, which may be based on price alone or a combination of price and other technical and economic considerations. Bid documents should include any margin of preference and any non-price criteria and its relative weight. Interpretation Guidelines: If the criteria for selecting the winning bid is presented clearly, in written format, and accompanies all tender documents, then this indicator should receive a rating of one. If the contract specifications are presented but are not thorough, this indicator should be rated a zero. If no contract specifications are presented, then this indicator should receive a rating of zero.

Indicator 41: Are tenders for pharmaceuticals publicized in newspapers, gazettes, trade publications or other means?

Rationale: Increase transparency of the bidding process and uses information to lessen the risk of corruption and ensures fair competition by opening up the bid to interested and eligible parties. Description: The government should publicize its upcoming tenders and invite bids from interested suppliers through appropriate information sources as listed above. Interpretation Guidelines: If tenders are regularly publicized in a range of mediums, then this indicator should receive a one. If tenders are not regularly publicized but when they are publicized, they are done so widely, then this indicator should receive a rating of one. If tenders are not publicized, this indicator should receive a rating of a zero.

Indicator 42: Is there a formal appeals process?

Rationale: A formal appeals process in the procurement process helps promote honest behaviour on the parts of the governments and the suppliers/ manufacturers.

26

Procurement of pharmaceuticals

Description: A protest mechanism works in the following way. If a firm is unsuccessful .in i~s bid for a tender, a representative from the firm can file a protest based on theu vIew that the tender excludes them unfairly or the tender process was flawed. Interpretation Guidelines: If there is a protest mechanism in operation and there is evidence of its use, then this indicator should receive a rating of one. Evidence should support this. If there is a protest mechanism in place but there is little evidence that it is used, then this indicator should receive a rating of zero. If there is no protest mechanism to speak of, this indicator should receive a rating of zero.

Indicator 43: .Is supplier performance monitored at least annually? Rationale: Monitoring of the procurement process post-tender is critical to ensure that drug suppliers are honoring their contracts. Poor performers can be identified and "blacklisted" from future tenders. Description: The government procurement office should monitor supplier performance and compliance with the contract terms. To this end, it needs to track suppliers' lead time, delivery status, shelf life, and packaging of products. Product quality must also be tracked. Interpretation Guidelines: If the government monitors supplier performance in a systematic and consistent manner, then this indicator should receive a rating of one. If the supplier performance is only monitored haphazardly, then this indicator should receive a zero. If there is no monitoring in place, then this indicator should receive a zero.

Indicator 44: Is the information obtained from the monitoring used to influence future procurement decisions?

Rationale: This indicator measures how effectively the government uses information on procurement processes. If a supplier has been found to be a poor performer or delivers sub-standard drugs, it should be barred from future contracts unless there are well- justified reasons provided. Description: The government should have a list of past suppliers and an evaluation of their performance. Poor performers should be identified and prevented from bidding in future tenders. Interpretation Guidelines: If the information obtained about supplier performance is used to influence supplier selection in the future, then this indicator should receive a one, if and only if, the criteria used are objective and based on evidence. For example, if a supplier does not meet the terms of the tender, then the government should have a list that precludes the same supplier from competing in future tenders unless reasonable justifications can be provided for past delinquency. If some information is available but it appears disorganized or 27

Improving transparency in the pharmaceutical system

inconsistent, this indicator should receive a zero. If there is no evidence of the required information, this indicator should receive a zero as well.

Indicator 45: Is there a management information system used to report product problems in procurement?

Rationale: One of the most important tools in the procurement office is its management information system. The procurement office and its clients should all use this system to monitor the drug procurement process. It should track the entire procurement process and signal problems when they arise so they can be easily addressed. This indicator can help reveal if the government is ensuring that the requisite checks are in place to ensure that the procurement process is seamless and opportunities for corruption are minimal. Description: The management information system can be computerized or manual. It should have product records, monitor supplier and facility performance, quality assurance records, accounts receivable and payable and reporting any problems in these areas. Interpretation Guidelines: If there is an efficient management information system in place that is up to date and comprehensive, then this indicator should receive a one. If there is an information system in place but it is not up to date, then this indicator should receive a zero. If ther~ is IlO information system in place, this indicator should receive a rating of zero.

Indicator 46: Is lot quality tested as part of the procurement procedure?

Rationale: Drugs purchased must be guaranteed that they are of good quality; this is an indispensable part of the drug procurement process. It is necessary, then, to provide checks against the risk of counterfeit products (both brand-name and generic) to identify products that are mislabeled with regard to identity, sources, with an insufficient quantity of active ingredients, without active ingredients, or with fake packaging. Description: Each drug shipment should be physically inspected. This involves adherence to contract specifications and order completeness and inspecting samples of all items to check against any abnormalities. Interpretation Guidelines: If there is a systematic procedure to sample drug shipments to ensure that they meet contract specifications, then this indicator should receive a rating of one. If lot samples are only checked periodically, this indicator should receive a rating of zero. If there is evidence of no checking procedure, this indicator should receive a rating of zero.

28

Procurement of pharmaceuticals

Indicator 47: Is there a clear procedure to ensure that payment is linked to drug delivery?

Rationale: Payments for drugs made without the requisite drug delivery are suspect. This indicator examines what procedures the government has in place to ensure that drug delivery and payments made correspond exactly. Description: The procurement office should have a record of each order placed with contract suppliers, the dates the payments were made, any amounts due, and a list of all purchase receipts from the recipient facility. Interpretation Guidelines: If there is a complete, current and well organized system to ensure that payment of drugs is linked to the delivery of drugs, then this indicator should receive a one. If there is an information system in place to monitor drug payment but it is not specifically tied to drug delivery, then this indicator should receive a rating of zero. If there is no clear procedure in place, this indicator should receive a one or a zero.

Indicator 48: Are unit prices paid for public procurement of pharmaceuticals below the unit price in the private sector?

Rationale: This indicator examines whether drug prices paid by the public sector are reasonable oy CdIl1panng them With drug priCes in the private sector. Description: The procurement office should have a listing of drug prices paid, by volume and type. Using recent lists, the unit price of 10 common drug prices paid for by the public sector should be compared with unit prices of the same 10 common drugs in the private sector. Interpretation Guidelines: If the majority of unit prices for publicly procured drugs are lower than the unit prices in the private sector, then this indicator should receive a rating of one. If the unit prices are above the unit prices in the private sector, then this indicator should receive a rating of zero.

Indicator 49: Are the drug procurement prices made publicly available?

Rationale: A public accounting system that reports on all expenditures made through the procurement process is considered indispensable for a country's good governance. If prices paid for drugs procured are made publicly available it reduces the likelihood of corruption and also fosters price competition. Description: The public accounting system should include the type of drug procured, the quantity of drugs procured, and the prices paid. This information ideally should be available through a government website so it is easily accessible.

29

Improving transparency in the pharmaceutical system

Interpretation Guidelines: If the drug prices the government pays is publicly available, either through the Internet or a public document, and are continuously updated, then this indicator should receive a rating of one. If the drug prices the government pays are available publicly but not updated regularly, then this indicator should receive a rating of zero. If drug prices are not publicly available, this indicator should receive a rating of zero.

Indicator 50: Is procurement conducted using generic names?

Rationale: Drug procurement for off-patented drugs should entail the use of generic names instead of brand-name names so that no supplier is given preference. Description: The tender document should specify the name of the drug under its generic name. A generic drug name refers to the approved or nonproprietary name of a drug. It is generally the international nonproprietary name (INN) given by WHO. Interpretation Guidelines: This indicator is straightforward. If drugs are listed by generic name, this indicator should receive a rating of one. If not, this indicator should receive a rating of zero.

Indicator 51: Is the average duration from issuing of tender to delivery of drugs less than 1 year?

Rationale: This indicator is designed to track instances of unusually long delays in the drug procurement process. Description: The average time it takes from the tender to the delivery of drugs should be calculated based on a representative sample of drug tenders. The sample of drug tenders should be recent.

Interpretation Guidelines: If the process from tender issue to drug delivery is less than one year in duration, this indicator should receive a rating of one. If the process is more than one year long, then this indicator should receive a rating of zero.

Indicator 52: Does the procurement unit have an annual audit with published results?

Rationale: Given that the procurement of drugs carries a high risk of corruption, an annual audit of the procurement unit is indispensable. This annual audit should be available publicly. Regular annual audits also contribute to data about existing contracts and operating costs for the procurement unit that can be compared in time.

30

Procurement of pharmaceuticals

Description: An independent auditing firm should conduct an annual audit to ensure impartiality. The annual audit should report operating costs of the procurement unit, pharmaceutical products tendered, quantities of the products, and the beneficiaries. Interpretation Guidelines: If the audit fits the criteria as outlined above, then this indicator should receive a rating of one. If there are irregular audits, then this indicator should receive a rating of zero. If there is none, this indicator should receive a rating of zero.

Indicator 53: Are the criteria for adjudication of the tenders included as part of the tender package?

Rationale: This indicator assesses whether the government has the requisite incentives in place to deter unethical behaviour on the part of government and suppliers. Description: The tender package should include clear information about what protest processes are available to participating firms. This information should be included in all tender packages. Interpretation Guidelines: If the tender package includes a comprehensive and clear inclusion about protest processes, then this ip.g.ic:ator should receive a rating of one. If information is available publicly but it is not included in all tender documents, this indicator should receive a rating of zero. If there are no criteria for adjudication available, this indicator should receive a rating of zero.

Indicator 54: In the past three years, is the share of drugs purchased through competitive bidding over 80 percent of the total pharmaceutical expenditure?

Rationale: This indicator is verifying that the government uses competitive bidding procedures for the majority of its drug purchases. Exceptions to competitive bidding may be justified when a drug is needed for the public health system but it is currently under patent. Description: The government procurement office should have a listing of all drug purchases and the method used for their purchases. Interpretation Guidelines: If the share of drugs purchased through competitive procedures is more than 80 percent, this indicator should receive a rating of one. If it is from 60 to 80 percent, this indicator should receive a rating of one. If the share is from 40 to 60 percent, this indicator should receive a rating of zero, from 20 to 40 percent, a rating of zero, and below 20 percent, a rating of zero.

31

Improving transparency in the pharmaceutical system

Questionnaire (Objective: assess transparency and efficiency of pharmaceutical systems with a focus on registration, selection of essential medicines and procurement)

Drug registration Indicator Does the drug registration process have an information system? 1

erit""" Criteria Name of company registering the drug Contact of company registering the drug Name of manufacturing company Country of product manufacturing Date of registration Product description Total Score'"

Rate

2

Are there written procedures on how to register a drug in the market for applicants and for assessors?

---::C:::n","t:::e",na:::" ' -_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

Public access Process description Fees mentioned Authorities involved in the registration process

Total Score'" Is there a standard application form? -Griteria Product name Product manufacturer Generic names of active substances Phannacological action Therapeutic classification Packaging insert

3

Total

4

Is this document publicly available and easy to access?

---::C:-n.c"t.ce..,nac." _--:::-:-:-_ _ _ _ _ _

= ___:-_______

Readily available at government office or website Total Score'"

5

Is there a formal committee responsible for drug registration? If yes, what criteria are used for selecting members to the committee?

---::C:-n_"t_e_na-::" ,-_-:-::-:---,_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

Formally established Composed with professionals with technical skills Meet on a regular basis Total Score"

6

Is there an organigram that describes the composition oj the committee available as a public document?

Criteria Member names Member responsibilities Up to date Public access Total Score'"

* Score = Total/Number of criteria for respective indicator 32

Question na ire

#

7

Indicator Criteria Rate Is the committee responsible for decision- Criteria 7en=c'-e-:th;:-:"a:-t-:-co:-mm---:i~tt:-ee-d;-:e-=a:-'sC"io:-ns:-:-a-r-e--:i-m-p--:l-=e-m:-e-n-=te:-d-;----making or does it act in an advisory capacity --:E:"'v""id Total

8

Does the committee provide an official written report for all decisions (e.g, accepted and rejected files)

Criteria

Existence of rejection criteria for registration Document explains reasons for rejection

Total Score"

9

Do terms a/reference exist which describe the purpose of the committee, its processes, duration, etc.? And, if so, are these available publicly?

--:Cri~'t::e:.:n::'a=----;-:--_--::--;-_ _ _ _ _ _ _ _ _ _ _ _ _ _ __

Existence of terms of reference

Terms of reference publicly available Terms of reference comprehensive Total

10

How does the committee reach its decision (jor --:C::n='t::e:.:n::'a=----:_ _~---::-__::_--:-:---~-:---------­ example, is a qualified majority required, Documented procedures for decision making consensus, etc.?) Are these procedures documented? Total Score"

11

Are members of the "COmmittee or any other --:C::n::'.::te::n.::'a=-_--;--:-_:---;---;-_ _-;-_-;--;--;-_ _ _ _ _ _ __ officials involved in the medicine registration Existence of standard form for declaring process formally required to declare any conflict of interest conflict of interest Standard fonn publically available Total

12

Is there an appeal process for applicants that --:C::n::'.::te::n::;'a=-_ _:-_ _ _-:-_-;-_ _-;--;----:-:-_ _ _ _ _ __ have their drug applications rejected? Formal appeal process in place which is transparent Evidence protest mechanism is used Total

Have there been drug recalls in the past 3 years? 13

~~7-~--~--~~~--~---------

Criteria Example

of

a

drug

recall

with

dear

explanations Evidence that infonnation shared with professionals and consumers Evidence of clear procedures for drug recalls Total Score'"

14

Are there formalized procedures to deRI with reporting of drug safety and efficacy?

Criteria

Information administration procedures Availability of information on side effects of medicines

Total Score""

* Score -

Total/Number of criteria for respective indicator

33

Improving transparency in the pharmaceutical system

15

Indicator Who does the committee report to and is this person responsible for making the final decision-making?

Criteria Criteria Open and transparent procedures decision making Democratic decision making Total Score'"

Rate

for

16

Is the registration fee set by law or regulation and publicly available?

Criteria Regulation or law includes registration fee Fee information publicly accessible Total Score'"

17

Is the time from application to decision-making ---=Cri='!"e"'n::'a'---_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ uniform from application to application? Consistency in registration time across sample of at least five Total Score"

Are there drugs in the market that are non-registered?

18

Criteria No evidence of non-registered drugs on the market Total ScoreII'

Total score for registration " Score = Total/Number of criteria for respective indicator

34

Questionnaire

Drug selection #

19

Indicator Does the government have Q national essrntial medicines list?

Criteria Criteria Evidence of a national essential medicines list Total

Rate

Is the essential medicines list in line with WHO EML model?

20

Criteria Officially adopted, published and disseminated By generic name By level of health care Linked to national standard treatment guidelines Evidence that widely disseminated to health professionals Total Score'"

21

Is there evidence of clear written criteria for including and --:C::n::"t:.:e::n::"a:..,--:-_-:-_ _:-_-:_:-:-_ _ _ _ _ _ _ __ eliminating drugs from the EMU Rules/criteria for drug inclusion or elimination Criteria available in written format in the public domain Total

Is the inclusion of new products on the EML based on studies of cost-effectiveness and health needs? 22

Criteria Clear guidelines on the inclusion of new drugs pased Qo C<lsl efrectiveness Gear guidelines on the inclusion of new drugs based on health needs

Total Score'"

23

Is committee membership on the drug selection committee on ~ rotl4ting basis Dr limited in time?

Criteria Limited or rotating membership Tenns of membership are of public domain

Total Score'" Are the decisions made by the selection committee publicly -'C::n::"t::e"n::"a:..,-_ _ _.,--...,-_ _ _ _ _ _-:-:-:-:-_ _ _ _ _ __ 24 dissemjn~ted?

Decisions on selection process publicly available Decisions widely disseminated Total Score'" Criteria Use of generic medicines primarily unless there is no generic substitute

25

Are generic medicines selected for the EML except in the cases when a generic substitute is not available?

Total Score'"

* Score = Total/Number of criteria for respective indicator

35

Improving transparency in the pharmaceutical system

26

Indicator Do terms of reference exist which describe the purpose of the selection committee, its processes, durDtion, etc. ? And, if so, ore these available publicly?

Criteria Criteria Existence of TOR for selection committee TOR publically available Total

Rate

Are there clear criteria for committee membership? 27

Criteria Clear criteria for committee membership Committee includes experts from different fields Publicly available through government office or website Total Score"

28

Are there clear rules jor decision-making joT the -='C::n,,"t::e;:.ri::a'-_-.,.-.,._..,,-_ _.,-_ _ _-,-_ _-.,._ _ _ __ committee decisions? Decisions made by all members in a democratic manner

Clear rules for decision making Total Score'"

29

Is there a law or regulation prohibiting members of the --:'C::n.:."t"'e;:.n;.."a_-:-:_ _ _ _-.,.-,-_ _ _ _ _ _ _ _ _ _ _ __ drug selection committee from accepting support in Existence of laws or regulations kind or in cash from pharmaceutical companies? Total

30

Is there a '"conflict of interest" form that members of -:C"n"'"t::e"'ri::.=--:-:-:--...,-,--c:--:::--c:-_-,--:-_ _ _ _ __ the selection committee are obliged to complete? Are Existence of declaration of conflict of interest form there clear sanctions for breach of these rrgu/ations? Clear and comprehensible sanctions Evidence of enforcements of these regulations Total Score"

31

Has any committee member worked in the past or is now working for the pharmaceutical industry?

Criteria No evidence of a member having connections to the pharmaceutical industry Total Score"

32

Is there an independent drug agency that provides -:C::n'C"t::e"'n::"a'-:-:--:-_-:-:-_-,-_ _ _ _ _ _ _ _ _ _ _ __ unbiased information? [ndependent drug information agency Supplies information regularly Total Score"

Total score for selection

* Score = Total/Number of criteria for

respective indicator

36

Questionnaire

Procurement of pharmaceuticals #

33

Indicator Criteria Rate Are there competitive procedures for the procurement of -'C::n,,'t::e::n""a'----,""'_,__-:------,-----,--...,..----pharmaceutical products? Oearly established competitive procedure for procurement of drugs Total Score'"

34

Does the government use written procedures (prepared -'Cri::::'t"e"'n,,'a'--_ _ _--:_______________ within the previous 5 years) jor drug procurement? Clear written procedures Up to date (revised in the last 5 years) Total Score'"

Are these written procedures publicly available? 35

Criteria Accessible through government office or website Dissemination of procedures to entities of interest Total

36

Is there a clear algorithm, based on utilization of services and health needs to determine quantity and type of pharmaceuticals purchased?

Criteria

Based on consumption historical data Based on adjusted consumption Based on morbidity Based on service level projection Total

Is drug procurement based on the national essential medicine list or hospital formularies? 37

Criteria Procured drugs are consistent with essential list and/or hospital formulary Existence of documents demonstrating the above Total Score·

38

Are there specific criteria for membership?

tender committee ~C=n~'t~e~ri~a~:_:_:----:----_,__---:___:_:_-----­ Gear guidelines for committee membership Membership criteria based on merit and effort Total Score·

Is the membership permanent? 39

Criteria Gear written procedures membership Changes on a regular basis Total Score·

for

tenure

of

* Score =Total/Number of criteria for respective indicator

37

Improving transparency in the pharmaceutical system

#

Indicator Are the contract specifications publicly available and distributed with the tender documents?

Criteria Criteria Gear written criteria for presenting a bid Criteria are always included in all tender documents Total Score'"

Rate

40

41

Are tenders jor pharmaceuticals publicized in newspapers, gazettes, trade publications or other means?

Criteria Evidence regularly publlcized. tenders Total Score'"

42

Is there a Jorma! appeal process?

Criteria Evidence of enforcement Total

I.., supplier perjonnance monitored at least annually? 43

Criteria Records of monitoring of supplier performance Records of monitoring of supplier's compliance with contract terms Total Score'"

Is the information obtained from the monitoring used to influence future procurement decisions? 44

Criteria Government has list of past suppliers Government has evaluation of supplier performance Information used to influence future decision Total ScoreII' Criteria System is clear and up to date Contains product records Contains monitoring of supplier and facility performance Contains quality assurance records Contains accounts receivable and payable Total Score" Criteria ~M~ed~J~·c~in~~~s~hl7·p~m~e-n~~~p~h-ys~i~c~al~ly~ins--p-e-c~te-d~-----------

Is there a management in/ormation system used to report product problems in procurement? 45

Is lot quality tested as part of the procurem(!nt procedure? 46

Systematic shipments Total ScoreII'

procedure

to

sample

drug

47

Is there a clear procedure to ensure that payment is linked 10 drug delivery?

Criteria Records of each order placed and amounts due

Dates of paymen~ List of all purchase receipts Total ScoreII'

* Score = Total/Number of criteria for respective indicator

38

Questionnaire

#

48

Indicator Criteria Rate Are unit prices paid for public procurement of Criteria phannaceuticals below the unit price in the private --;;Th:;:-:e----::m=-a::j=-on::";:ty=-o::f:-;;th=-e=--u-n-:i:-t-p-n-:"c-e-s---;fo-r-p-u-:b-:l7"ic";"ly----sector? procured drugs are below the prices in the private sector.

Total

49

Are the drug procurement prices made publicly -;Cri::;:-:"t:;e:::n="a'-;--::-:-_-::--:-:_ _ _ _ _ _ _ _ _ _ _ _ __ available? List is publicly available List contains type of drug, quantity purchased, and price paid

List is continuously updated Total

50

Is the procurement conducted using generic names?

Criteria Use of generic names

Total Score"

51

Is the average duration from issuing of tender delivery of drugs less than 1 year?

to

-;C::n::"t;;:e=n="a'---_ _---;:----;_-:-_ _ _ _ _ _ _ _ _ _ __ Delivery average less than 1 year Total Score"

Does the procurement unit have an annual audit with published results? 52

Criteria

Annual and published Cond.ucted by an independent auditing finn Reports operating costs of procurement unit

Report pharmaceutical products tendered Reports quantities of products Reports beneficiaries

Total

53

Are the criteria for adjudication of the tenders included -:C::;n="t::e=n::" a'::---:-_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ as part of the tender package? Oear criteria Criteria is publicly available Criteria is included as part of the tender

package Total Score""

54

In the past three years, is the share of drugs purchased ---'C"n:.:"t::e:.:n::"a':-:-_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ through competitive bidding over 80 percent of the Over 80% total pharmaceutical expenditure? Total Score""

Total score for procurement * Score = Total/Number of criteria for respective indicator

39

Improving transparency in the pharmaceutical system

Selected readings Bardhan, Pranab. "Corruption and Development: A Review of the Issues," Journal of Economic Literature, voJ.XXXV, September 1997, pp.1320-1346. Jillian Clare Cohen, James Cercone and Roman Macaya, "Improving Transparency in the Pharmaceutical System: Strengthening Critical Decision Points Against Corruption." World Bank policy document, June 2002 Cohen, Jillian Clare, and Jorge Carikeo Montoya. "Using Technology to Fight Corruption in Pharmaceutical Purchasing: Lessons Learned from the Chilean Experience," Flagship Online Journal, World Bank, February 20, 2001. [http://www.worldbank.org/wbifhealthflagship/journaliChile.pdf] Ferrinho et aJ. "Pilfering for Survival: how Health Workers use Access to Drugs as a Coping Strategy" Human Resources for Health 2004, 2:4, 2004 Johnson, Simon, Daniel Kaufmann, and Pablo Zoido-Lobat6n. "Regulatory Discretion and the Unofficial Economy," American Economic Review, vo1.88, no.2, May 1998, pp.387-392. Kaufmann, Daniel. "Corruption: The Facts," Foreign Policy, Summer 1997. Klitgaard, Robert. "International Cooperation Against Corruption," Finance and Development, vo1.35, no.l, March 1998, pp.3-6. Transparency International Global Corruption Report, Pluto Press, 2004. Williams, Robert, editor. The Politics of Corruption, Northampton, MA: Edward Elgar Publishing, Inc., 2000. World Health Organization, UNICEF, UNDP, World Bank. (1999) Operational Principles for Good Pharmaceutical Procurement. WHO/EDMjPAR/99.5.

40

I I

Improving transparency in the pharmaceutical system

To do list for data collectors Improving transparency in the pharmaceutical system: 1.

Ensure that you have up to date information on all areas of the pharmaceutical system, particularly in the areas of registration, selection, and procurement. Check for NGO reports, government documents, private sector documents etc. Determine whom you want to interview for the questionnaire (at least ten persons should be interviewed for each decision point). Remember you should have a cross-section of upper and junior level persons from government, industry, the NGO, and even the media. Ensure that you send out a letter of request for an interview (see model) to the requisite persons. Ideally, a letter should also be sent out to high level persons so they can either participate or provide you with the name of a person who is appropriate. Within ten days of sending your letters, contact the requisite persons by telephone if you have not already heard back from them. Set up meetings When you interview a stakeholder, remember to ensure that you record all answers according to the indicators but also provide yourself with room to add additional information that may be relevant Compile your responses to determine trends Send your compiled information to (baghdadig@who.int) by 30 March 2005. Guitelle Baghdadi, WHO/EDM

2.

3.

4.

5.

6. 7.

8. 9.

10.

If you have any questions as you go along, please send an email to Guitelle Baghdadi for assistance.

42

To do list for data collectors

43

Improving transparency in the pharmaceutical system

Model letter to send to key informants requesting interview Dear _ _ _ _~ Given your experience in the pharmaceutical system and knowledge of the issues facing (name of country) today, I am writing to request your participation in a study for the World Health Organization (WHO). As part of its Essential Medicines Strategy, the WHO is committed to improving the efficiency and transparency of pharmaceutical systems globally. This is part of its global efforts to improve access to medicines for all. Accordingly, WHO is conducting a multi-country study in South East Asia.

I am collaborating in this study for the WHO. Specifically, we want to determine what works well and where improvements can be made in three core areas of the pharmaceutical system: registration, selection, and procurement. This study includes a uniform series of questions that we will be asking key stakeholders in various country settings. We are seeking your knowledge on the subject and also will ensure that all of your~nswers are kept confidential and will be anonymous in the final report I would like to set up a meeting with you in the next week, ideally for an hour and a half. If you are not able to participate, I would be grateful if you could let me know the name of a suitable colleague. Please feel free to contact me at (email address and telephone number) should you require any further information. Sincerely,

"

JI

J Your Name Your Position ) )

44