in fiscal year 2005, increasing to 27 percent in 2006 (OGAC, 2006c, 2007). In addition, because some focus countries rely on WHO prequalification, they require it in addition to FDA approval. Thus, PEPFAR’s strategy for ensuring the quality of the ARVs it provides has impeded harmonization and the rapid availability of PEPFAR-supported first-line ARVs.

To support countries’ ownership of their responses to their HIV/AIDS epidemics, the U.S. Global AIDS Initiative should maintain its commitment to harmonization and participate fully in the development of harmonized procedures. To this end, the U.S. Global AIDS Coordinator should work to support World Health Organization (WHO) prequalification as the accepted global standard for assuring the quality of generic medications. Specifically, the Coordinator should provide an analysis of WHO prequalification that determines whether it can adequately assure the quality of generic antiretroviral medications for purchase under PEPFAR. If the analysis shows that WHO prequalification needs strengthening to provide a sufficient guarantee of quality for PEPFAR, the U.S. Global AIDS Initiative should work with other donors to support strengthening of the process, and work to transition from U.S. Food and Drug Administration approval to WHO prequalification as rapidly as feasible. (5.2)

Budget Allocations Reduce Flexibility and Impede Harmonization and Program Implementation

One of the strengths of the U.S. Global AIDS Initiative is its orientation toward and accountability for specified results. The Coordinator’s annual reports to Congress have shown progress toward the defined, measurable performance targets set forth in the legislation and the PEPFAR strategy (OGAC, 2005b, 2006b). Appropriately for a program this early in implementation, most of the results reported at this stage are for targets that can be measured in the short term, and thus they reveal more about the program’s implementation than its impact.

However, one set of the Leadership Act’s short-term targets—its budget allocations—has adversely affected implementation of the U.S. Global AIDS Initiative. In mandating the strategy that was eventually to become known as PEPFAR, Congress wisely required that the “strategy shall maintain sufficient flexibility and remain responsive to the ever-changing nature of the HIV/AIDS pandemic.” However, Congress also required that the program adhere to a fairly large set of specific budget allocations.3 At the

3

The budget allocations include 55 percent for “therapeutic medical care of individuals infected with HIV, of which such amount at least 75 percent should be expended for the purchase and distribution of antiretroviral pharmaceuticals and at least 25 percent should be expended for related care”; 20 percent for “HIV/AIDS prevention, of which such amount at



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