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18 January 2016
GENEVA – As part of a new framework for procuring health products in the most cost-effective and sustainable way, the Global Fund has reached an agreement to purchase insecticide-treated mosquito nets that prevent malaria with projected savings of US$93 million over two years.
By achieving sharply lower prices for nets – a 38 percent reduction from 2013 – the agreement serves the Global Fund’s goal of accelerating progress against malaria, a preventable disease that most seriously affects young children and pregnant women. Building on the Global Fund’s large-scale purchasing power, the framework improves the supply of an important tool to fight the epidemic.
The Global Fund projects US$350 million in mosquito net purchases over the next two years through its Pooled Procurement Mechanism. A tender process has selected 10 suppliers and includes volume commitments from the Global Fund and performance contracts from the suppliers.
The agreement creates a level of certainty for suppliers, allowing them greater visibility and planning time to manufacture and deliver nets. That facilitates lower prices, and yields significant savings for the Global Fund partnership. The US$93 million in projected savings is equivalent to about 40 million additional nets.
“The money saved here can buy more nets,” said Christopher Game, Chief Procurement Officer at the Global Fund. “We worked closely with partners to strike the balance between achieving cost savings, promoting sustainable supply, and recognizing manufacturer investment in the development of new products to fight malaria.”
A previous Global Fund procurement tender for insecticide-treated mosquito nets was concluded in late 2013 and implemented over 2014-2015. That agreement saw the successful purchase of 170 million nets at a stable price, with a major improvement in delivery times.
The agreement is geared to purchase nets from multiple suppliers, reducing risk and encouraging local production, which reduces transport costs. About one-fifth of the nets to be procured will be manufactured in Africa. For the first time, the nets will be color-coded, allowing their durability to be tested at six-month intervals. The data collected from this research creates the possibility for future product innovation.