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Differential Pricing UNFPA’s Experience With
Contraceptives
Christian Saunders, Chief, Procurement
Services
Every Minute in the World
380380 women become pregnant
190 of these women190 of these women did not plan or do not wish the
pregnancy
110 women110 women experience a pregnancy-related complication
4040 womenhave an unsafe abortion
1 woman1 woman dies from a pregnancy related cause
Every Minute in the World
650 people650 peopleare infected are infected
with a curable STIwith a curable STI
Every Minute in the World
10 people10 people are infected with HIV
Every Minute in the World
ICPD +5 Governments should strive to ensure that
by 2015 all primary health-care and family planning facilities are able to provide directly or through referral, the widest achievable range of safe and effective family planning and contraceptive methods; Essential obstetric care; Prevention and management of reproductive tract infections, including sexually transmitted diseases; And barrier methods, such as male and female condoms and
microbicides if available, to prevent infection.
Paragraph 53, ICPD +5
The United Nations Population Fund (UNFPA) Advancing universal access to reproductive health· Family planning and safe motherhood· Preventing sexually transmitted infections, including HIV/AIDS · Care for consequences of unsafe abortion· Eliminating harmful traditional practices
Advocating informed, responsible and free choices· Women’s rights to health, education and freedom from violence· Sustainable development
Formulating population strategy & policy· Partnerships with governments, NGOs, the private sector and UN agencies· Research on population issues
For every $1 million shortfall in contraceptive commodity assistance:
• Increase in the number of unintended pregnancies: 360,000360,000
• Additional induced abortions: 150,000150,000
• Additional maternal deaths: 800800
• Additional infant deaths: 11,00011,000
• Additional deaths of children under 5: 14,00014,000
Does Price matter?
Procurement
• UNFPA is the largest public sector purchaser of contraceptives. Also supplies commodities for social marketing programmes.
• Procurement undertaken by UNFPA is carried out through a fair & transparent process.
• UNFPA utilizes competitive bidding and direct negotiation in the case of proprietary products.
• Long term pricing agreements have been negotiated with many of the manufacturers.
UNFPA vs. MARKET PRICE
(US$) UNFPA US MARKET
• Condom (piece) 0.025 0.50• IUD (Unit) 0.430 350.00• Injectable (dose) 0.675 65.00• OCs (cycle) 0.175 30.00• Spermicides (tablet) 0.060 1.20• Implants (set) 23.000 393.00
Cost per year of coverage
(US$) UNFPA US MARKET
• Condom 3.75 75.00• IUD 0.10 70.00• Injectable 2.70 65.00• OCs 2.10 360.00• Spermicides 9.00 180.00• Implants 4.60 79.00 • Surgical (female) 1.06• Surgical (male) 0.60
• Volume
• Procurement Process
• Market Share
• Image
• Philanthropy
Possible Factors Affecting Price!
Procurement Volume
$20.00$25.00$30.00$35.00$40.00$45.00$50.00$55.00
Year
US$
(Mill
ions
)
Procurement Process
– Competition– Experience– Professionalism– Quality – Single client– Uncomplicated– Transparent– Long term partnership with strategic suppliers– Standardization– Forecasting allowing for planned production– Flexibility– Guaranteed Payment
ORAL CONTRACEPTIVES -‘THE PILL’
0.10.120.140.160.18
0.20.220.24
YEAR
US
$
UNFPA USAID
CONDOMS
00.010.020.030.040.050.060.07
YEAR
US$
UNFPA USAID
INJECTABLES
0.60.65
0.70.75
0.80.85
0.90.95
1
YEAR
US$
UNFPA USAID
IUDs
0.30.50.70.91.11.31.51.7
YEAR
US$
UNFPA USAID
SPERMICIDES
0
0.05
0.1
0.15
0.2
YEAR
US$
UNFPA USAID
Sub dermal Implants
10
15
20
25
30
YEAR
US$
UNFPA USAID
Source Of Procurement
0102030405060708090
YEAR
PE
RC
EN
TA
GE
Developing CountriesDeveloped Countries
Differential Pricing PROPRIETORY PRODUCTS
Example
Product ‘X’
(Oral Contraceptive Under Patent)
UNFPA's price US$ 0.364/cycle
US Market price : US$ 34.00/cycle
“Rapid population growth and high fertility hold back development and help to perpetuate poverty.”
179 countries adopted the ICPD Programme of action in Cairo in 1994. Five years later, a review identified key areas for urgent action. .
- Contraceptives for couples wishing to space or limit families.
- Condoms, voluntary testing and counseling to reduce the spread of HIV/AIDS among young people.
Availability of a wide range of safe and effective family planning methods.
Births assisted by skilled attendants.
- Literacy for women and girls.
- School enrolment, especially for girls.
.
UNFPA - Future Action
The Future
• E-commerce• Competition• Group buying• Standardization • choice vs. security
