Examination of Witnesses (Questions 820
- 839)
TUESDAY 22 APRIL 2008
Dr Julian Lob-Levyt, Mr Geoff Adlide, Ms Linda Bifani
and Ms Magdalena Robert
Q820 Chairman:
Amongst others, we have seen the International Federation of Pharmaceutical
Manufacturers & Associations. Do you feel they are doing enough?
And could they do more? What is your feeling about them? And how
closely do you work with them?
Dr Lob-Levyt: We have on our Board two seats
for the pharmaceutical industry, that from the north and that
representing the south. We now buy between 30 and 40 per cent
of our vaccines from manufacturers from emerging markets, countries
such as India, Brazil and elsewhere. We used to purchase everything
from the north. This is a very healthy dynamic. I was in India
not so long ago visiting the Serum Institute of India. And as
you go into their facilities, you could be in Geneva, it is the
latest state of the art equipment, high quality, and this is really
very encouraging. We work very closely with industry through our
Board. I can truthfully say that, at least in the vaccines area,
a space has been created by GAVI where we can have a fairly open
debate about some of the issues, and it is less confrontational.
Particularly in drugs, there has been a lot of controversy over
antiretrovirals which has made debate quite challenging and difficult
and, to some extent, has caused industry to shy away from those
debates. In vaccines we have not had that problem, and GAVI has
created a space where we can have quite healthy debates about
getting to the best prices, getting products, and we are able
to hear views that are different from emerging industry and existing
industry as to what the issues are. I hope we preserve that in
GAVI. We are also witnessing in the pharmaceutical industry writ-wide
that less of the big blockbuster drugs are emerging from which
they are making their big profits on the drugs side, and there
is a lot more attention now on the vaccines side, a lot of new
and exciting vaccines coming through. That may change the nature
of debate in time as profits become more dependent upon profits
made on the vaccines side. However, with vaccines we have the
tiered pricing concept whereby we in the UK, or in Europe, are
prepared to pay a higher price, middle income countries a lower
price and with industry we can get fairly close to basic manufacturing
prices. If we can preserve that tiering for the poorest parts
of the world, that is a very healthy part of it. Could industry
do more? Yes, they could, and for example we are encouraging and
working with industry to support more of the clinical trials at
a country level. Industry is quite often able to provide some
of the finance provision of vaccines for free, say, whilst we
are going through the testing phase.
Q821 Chairman:
What about developing some production facilities in the area?
I know that is difficult in Africa particularly, but it is not
difficult in many other areas and it is happening, is it not?
Dr Lob-Levyt: GAVI has made a decision to mostly
use our finance around what we call "market shaping",
so that our ability to purchase, our long-term financing and innovative
financing is used as the pull mechanism that encourages industry
to invest itself in what needs to be done. We do not invest in
the basic research, for example. We do not see that we have the
competence or would get returns in that way, nor would we invest
in establishing plant in, say, India or elsewhere. We would rather
see, and we are seeing this and have had an independent study
which has confirmed this, industry coming in forming partnerships
in India and elsewhere, and there is a transfer of technology
and joint ventures now being set up. The only competence of GAVI's
is its money is to incentivise that.
Q822 Chairman:
I am not making myself quite clear. My question was whether in
your discussions with the pharmaceutical manufacturers you discussed
the setting up of production facilities in that country, not you
yourselves doing it.
Dr Lob-Levyt: That is something that we are
interested in and we discuss that with industry. One of our concerns
is always about having sufficient capacity across the world. It
is a really difficult situation to be in when you are at marginal
capacity because, if one plant closes down, it can close down
for a year or two because of biological safety issues. We are
concerned to have sufficient capacity and competition. We talk
a lot with industry about what their plans are and what is happening,
but I would not say this is something we have a very strong influence
over through that discussion, it is more about understanding what
is happening.
Q823 Lord Desai:
Basically, we have been talking to quite a lot of people giving
evidence, and one of the points has been the overlapping of bodies.
We have talked to UNITAID, the Global Fund and others, and the
question was what were they doing that others were not doing.
I ask the same question of you. Is there scope for some kind of
rationalisation of what you do and UNITAID and the Global Fund
do, or maybe not?
Dr Lob-Levyt: I think, as I said before, that
in this rather exciting and welcome situation where a thousand
flowers have bloomed as a response, which I think is a healthy
thing because it promotes different ideas and competition, from
a developing country perspective this complex situation is really
challenging. You will be aware of those studies that show Tanzania
had 300 visits to the Ministry of Health in one year from NGOs,
the Global Fund, a whole plethora of different organisations.
We have to change that. The solution are country led frameworks
to do that. Having said that, I think we need to better categorise
the different kinds of Global Health Partnerships that now exist
and understand where there is advantage in that distinction and
where there is advantage in bringing some of those together. So
you have largely advocacy initiatives, some about product development
at the more basic end, and others that are principally financing
instruments. We and the Global Fund are probably more of the last
nature although, unlike the Global Fund, we use our finance in
a more innovative way to get more product into market as a market-shaping
initiative. I see that there is potential for merging some of
these partnerships, maybe some of those in product development
or advocacy, and I do not rule out eventual merger of GAVI and
the Global Fund, for example. These kinds of things need to be
thought through. We are very different from the Global Fund, in
the way that we are organised. We are a much broader public-private
dynamic and our Board is made up of private sector individuals
as well as institutions, which brings a very exciting challenge
dynamic whilst the Global Fund is more of a classical partnership
of institutional representation. We need to understand those different
dynamics which generate different benefits.
Q824 Lord Desai:
Another issue was about aligning international efforts with national
priorities. Who assesses these priorities? Do you assess the priorities?
Do you have partnerships with the countries?
Dr Lob-Levyt: Basically, the priorities should
be set by countries themselves and we should try and work behind
those priorities, no question. In some areas in order to ensure
that there is informed decision-making and priority-setting, information
is needed, and I think we rely on the normative role of agencies
such as WHO and others to ensure that the correct information
is available to the country to make those decisions. A good example
would be HPV vaccine, the vaccine against cervical cancer, recently
introduced in the UK and certainly in other countries. That vaccine
is less well-known and understood in the poorest countries in
the world. Many of the poorest countries in the world would probably
not be aware of the disease burden of cervical cancer amongst
women in some of the poorest parts of their communities. Until
that information is known, they may not prioritise that vaccine
just giving this as an example but there will be others. Because
we are now in a situation of new vaccines coming in against diseases
which before we considered untreatable in the poorest parts of
the world, part of this is about information-sharing to get that
informed decision-making. Where we have to be very careful, and
it is a challenge, is the distorting effects that we as global
programmers can impose on national budgetary systems. If, through
our enthusiasm and our advocacy, we are causing a country to take
on a new and expensive vaccine that they have to pay for at the
end of the day, there has to be a trade-off against another disease
intervention. In GAVI, I think we have now got over that, because
we insist on seeing how this fits into the national strategies
over a long period of time. We are now talking about 10, 15, 20
year time horizons. We also have a much better understanding of
how vaccine prices are declining and national budgets are growing.
We did some interesting work, again through independent consultants,
which showed that a package of vaccines, (including a theoretical
malaria vaccine that we do not have yet), and given our long-term
time horizons—it is clear that this long-term financing
is so key in the way we introduce, co-financing and understanding
how vaccine prices are declining and economies are growing In
all but perhaps five of the poorest countries in the world, that
package of vaccines would never rise above between two or five
per cent of a national health budget—provided we take this
long-term time horizon. We are confident that what we are doing,
if we take the long-term view, is not distorting. GAVI is prepared
to heavily subsidise in these early years to ensure that we do
not distort budgets. There will always be four, five or more countries
where you cannot imagine, for various reasons of conflict or lack
of resources, that their economies are ever going to grow. That
is a humanitarian situation which we have to accept.
Q825 Baroness Whitaker:
To return briefly to your synergy with other parts of the international
system, how do you manage your relationships with the regional
and country offices of the WHO? Are you going to be comfortable
with one UN office?
Dr Lob-Levyt: I think the reform of the UN is
absolutely vital if these institutions are going to survive; and,
if they do not survive, that would be a disaster, because they
are absolutely necessary. Maybe not all, but there are many that
we would consider to be necessary, WHO is vital. It is a vital
normative agency, particularly for the poorest countries in the
world, where they do not have those capacities. We work not only
with WHO headquarters—and they are an active member of our
Board and provide us with a lot of the technical advice and support—but
we also work down through the regions as well. We have WHO regional
committees working with us and we rely particularly heavily on
the Country Offices to support countries with the introduction
of new vaccines.
Q826 Baroness Whitaker:
How would that work technically? Would you be on their committees?
Would they be on your committees?
Dr Lob-Levyt: WHO has its own committees that
set normative standards, and we just accept and follow those.
Q827 Baroness Whitaker:
At country level?
Dr Lob-Levyt: At the global level on the normative
side. Sometimes we come up with a new vaccine and we ask WHO,
with others, to advise us, "How should this be packaged?
How should it be delivered", and they come back to our Board
and tell us how it should be done. They would consult with the
Regions and the Country Offices to do that. The Country Offices
are mostly about implementation, whereas the normative, standard-setting
work and related thinking happens mostly at the Headquarters and
goes down to the regions.
Q828 Chairman:
Before we move on, I just want to pursue a little further this
question of the number of organisations. You indicated there might
be a need to merge in due course. What puzzles me is that, if
you come here to Geneva or talk to the senior managing groups
of these organisations, they are all determined to make it work.
They are very able people, very committed, have a very clear focus
on eliminating key diseases, and you can see why it works well,
simply because it is driven by people who have a very clear, specific
aim and want to work together. I am not convinced that translates
to ground level, where you might find many of these organisations
doing slightly different things and, despite the best efforts
of the leadership of all of these organisations, who if they were
all put in a room would agree about everything almost instantly,
that might not happen down on the ground. Does that make sense?
Dr Lob-Levyt: I think that is absolutely correct.
You have a fairly unique moment in time, with some great leadership
of different institutions who are very committed Margaret Chan
at WHO and others, which provides a great opportunity. You are
quite correct, these are large institutions and providing the
internal institutional incentives to change behaviours takes time
and is challenging, but we are beginning to see that happen. Again,
I think the key is to make this country-driven. The IHP I am very
enthusiastic about, because it can help us do that. What the IHP
has committed itself to do, and I think this is really important,
is to convene annually with that very high-profile global leadership
and say, "Well, Julian, what did GAVI do at the country level?
Did you change your behaviour?" So the Minister of Health
from Ethiopia will be provided with an accountability framework
that goes from the country level up to the global level and that
says, "This was promised. It did happen" or "It
did not happen". I think that would provide a powerful incentive
to all these institutions. There is another dynamic, not only
that top-down dynamic but a bottom-up dynamic, which is very often
found at the country level with development partners, WHO and
others. There can be a local agreement on how to do things, and
people are working well together. But, when it goes up to headquarters,
for example even the UK, US or France, what happens can be rather
different from what happens down at the country level. If you
speak to most ministers of health in developing countries, it
varies they currently feel there is quite a lot of traction about
what happens at the country level but very little accountability
up into the global level and that is what they would like to see
happening. I think the IHP will help us get there.
Q829 Chairman:
I understand your enthusiasm for the IHP. If you have a situation,
which presumably must exist in some areas, where you have got
a number of these organisations and you have not got a good country
organisation, how does a national government like the UK or an
organisation like WHO justify the use of the money? In other words,
do you say, "Right, it is not working, we will stop it"
after having tried to make it work? What do you do? There is always
a danger, and you touched on it yourself, that if the electorates
in the paying country begin to feel that money is not being well-used
they turn against aid. That would not be the first time it has
happened, although at the moment the political leadership on the
right and left is much better than it has been in the past on
all accounts, funnily enough. There must be a danger that some
of these organisations are not functioning so well at the ground
level, that gets noticed. Is it maybe a case where you say that
some of these organisations ought to be merged, in other words
the health architecture is too diverse? What are your comments
on that?
Dr Lob-Levyt: There are two parts to that. One
is where governments themselves in sub-Saharan Africa or elsewhere
are not functioning well enough and where the institutions that
are supporting them are not functioning well. We have to be driven
by the results, and donors and those who sit on the boards of
global institutions, multilateral or others, have a responsibility
to ensure there is accountability to performance. Where it is
not being delivered, no more money should be pumped into it, or
the problem needs to be resolved. If you look broadly where systems
are functioning well, national systems together with development
partners at the country level, a lot of money does flow and it
flows effectively. Where it is dysfunctional, you will see a lot
less money flowing because countries cannot absorb that finance.
Q830 Chairman:
Are there organisations operating in the countries of various
types in delivering the aid systems which you think would be better
merged? I am not necessarily asking you to name names, but do
you think they would be better merged now because it is too diverse,
it is too cluttered?
Dr Lob-Levyt: I would have to honestly say that
I think we do need to think about respective roles and strengths
in the long-term and simplify the world for some of the poorest
countries.
Q831 Chairman:
There is no mechanism for doing that, is there?
Dr Lob-Levyt: No, I think it extremely difficult.
Have you have got any good ideas?
Q832 Chairman:
Should it be a task for the World Health Organisation as a coordinator,
if you like?
Dr Lob-Levyt: I think the World Health Organisation's
strength is its normative agendas, setting normative standards,
and less on the implementation side. On the normative areas, yes.
In terms of coordination, it is national governments that should
be put in charge through their development frameworks. There is
a huge risk in putting one institution in charge of all coordination,
one global institution. You really risk lack of fresh ideas, being
in a situation of limited change, limited accountability. I think
it is fundamentally healthy to have a bit of competition, as it
were, at the country level. Many developing countries are quite
adept at managing that situation, but it is too complicated. Again,
we need to work to national strategies and frameworks and agree
to abide by them. Bilaterals are as much a part of the problem
as are multilaterals, as are Global Health Partnerships. This
is a collective responsibility.
Chairman: Yes. There is a theory that
says democracy works best when it is messy and worst when it is
well-organised. There might be an element of similarity here.
I would not like to push the analogy too far, but you know what
I mean. I would not like to push it too far in politics either!
Q833 Baroness Whitaker:
Do you think that International Health Partnerships is the best
way to simplify as much as is good?
Dr Lob-Levyt: It is one way of doing this, but
I do not think it is the only way. Again, you need a WHO that
works with partnerships but works as an institution with its own
legitimacy and independence.
Q834 Baroness Whitaker:
You mentioned collaborating much more closely with the Global
Fund. But what about UNITAID. Is that not much closer to your
kind of operation?
Dr Lob-Levyt: We will be having some meetings
with UNITAID in the near future. They have been focusing mostly
on the drugs side.
Q835 Baroness Whitaker:
Sure, but drugs and vaccines are not a million miles apart?
Dr Lob-Levyt: Absolutely. Now that they are
established, they have approached us and we are going to have
some discussions with them about where we could be collaborating
together.
Q836 Lord Avebury:
Could there be particular collaboration on an Advance Market Commitment?
If that was something that worked in vaccines, why should it not
be equally effective in the wider field of drugs?
Dr Lob-Levyt: I think that is absolutely right.
The Pneumococcal vaccine is a pilot, it is about to be set up—institutionally
it can be done, financially is it efficient, does it work—and
then it should be tested elsewhere.
Q837 Lord Avebury:
But, because you have the expertise, you could transfer that to
UNITAID?
Dr Lob-Levyt: Absolutely, if necessary.
Ms Bifani: On the advocacy and donor relations
outreach side, we are certainly working together with UNITAID.
We have just had people from UNITAID and GAVI in Brazil to meet
with Brazilian Members of Parliament, because there is a bill
in Brazilian legislation for support to UNITAID and GAVI. It was
a verbal IFFIm commitment that was made from Lula to Tony Blair
that we are following up in collaboration with the UK Embassy.
This week, with UNITAID, we are in Senegal at a conference on
global leadership and innovative financing, where we are both
presenting UNITAID's model and GAVI's pilots on IFFIm and AMC
together. On the advocacy side we do things together.
Q838 Baroness Whitaker:
I think that very neatly leads into what is probably our last
question area. You say that lessons from your public-private partnership
business model could be useful to others, and you have obviously
broken the ground on innovating financing, as you have said. We
have heard quite a lot about that already, but if you have anything
to add it would be helpful. As you know, we have to make recommendations
and it may be that we should give a little bit of airtime to some
of the innovations. Perhaps you would like to angle your remarks
in that way. Could you also tell me if your Service Delivery Platform,
which is a very interesting idea to get rid of the horizontal/vertical,
is the same as WHO's diagonal structure. Or is one a subset of
the other?
Dr Lob-Levyt: I will answer the second part
first. We have agreed with WHO and the H8—leaders of the
8 major health agencies, which is another form of collaboration
that is developing—that we will not use the term diagonal
any more. We found it just as confusing as vertical and horizontal.
Q839 Baroness Whitaker:
Service Delivery Platforms?
Dr Lob-Levyt: Very often, when you talk about
health systems, that can be quite confusing for many people as
well. That is what we try and use the term "service delivery
platforms" to get over this, and it seems to work for us.
You hear a lot about the "public-private" dynamic in
health and development at the moment, and it is a term used very
loosely. We have thought about this quite deep and hard and what
does it really mean for GAVI. There is no question in my mind
that, by having a Board and a philosophy that is driven by recognising
there are values in the public and private sectors, where in development
you mostly use public sector types of values, it is very useful
to infect us with private sector thinking. On the new Board that
we are creating at the moment, one-third of the seats will be
reserved for individuals who do not represent institutions but
come with particular skills out of the private sector to challenge
us to do better. So when I report to the Board and say "We
prevented 2.9 million deaths for $1 billion" or whatever
it might be, the traditional public health community, among which
I count myself, would normally feel delighted and very happy with
that and we would move on. But the first and instant question
from my private sector Board members will be "Well, Julian,
why was it not 3.9 million? And why did you not do it for half
the cost?" I think that is a very healthy question because
development finance is so scarce. It is the most valuable of dollars
and has got to be made to work most efficiently. I have learnt
a lot working over the past three years with this different community,
who want crisp decision-making, evidence of results and the want
to understand how much it is costing and why can we cannot do
it differently. Challenging the status quo is a huge value-added,
but you need a Board with people who can do that. Having been
in the development business for a long time, I can assure you
that the boards of most other organisations do not self-challenge,
it is quite a cosy relationship. In GAVI we do not have that,
we have a very dynamic tension which is really important to preserve,
and I have learnt a lot from that personally.
Baroness Whitaker: How would we
frame that as a recommendation?
Chairman: With difficulty!
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