How PEPFAR aims to spur medical manufacturing in Africa

The U.S. President’s Emergency Plan for AIDS Relief, or PEPFAR, plans to engage financial institutions to help spur medical manufacturing in Africa as part of the initiative’s new strategy, U.S. Global AIDS Coordinator Dr. John Nkengasong told Devex. Involving development finance and commercial banks will help improve access to cheaper drugs, diversify the supply of pharmaceutical goods, and spark medical innovation on the continent, according to PEPFAR’s new five-year strategy released on Dec. 1. The goal is to boost regional manufacturing in global south countries — especially across Africa — so they can produce more medical products locally and lessen their reliance on foreign imports. A bigger role for the private sector is a key focus of PEPFAR’s first blueprint under Nkengasong, the former head of the Africa Centres for Disease Control and Prevention who was sworn into his current role in June. A Cameroonian-American, he is the first African to lead PEPFAR, which has an annual budget of approximately $6 billion, and has spent more than $100 billion since its creation two decades ago. The strategy aims to accelerate the fight to end HIV/AIDS globally by 2030 while strengthening public health systems in a sustainable way. In a world where countries are confronting multiple health crises, such as Ebola and the COVID-19 pandemic, “decentralized manufacturing” is a key component to help governments respond to both emerging infectious diseases and the HIV/AIDS epidemic, Nkengasong told Devex in an interview. COVID-19 exposed the dearth of medical equipment and vaccines produced on the continent, he said, and institutions such as the African Development Bank and the African Export-Import Bank, or Afreximbank, can play a role in helping countries be better prepared to combat future health threats. “They recognize that partnerships with groups like PEPFAR and others in a coordinated manner will be a serious investment for the future and will protect national economies and regional economies,” he said. The new strategy also outlines a focus on advancing health equity for “priority populations,” such as adolescent girls, young women, and children; sustaining the response to HIV/AIDS in the long term; strengthening public health systems and health security; building partnerships with the private sector, foundations, and community leaders; and “following the science,” or advancing the latest scientific innovations in HIV/AIDS. Focus on manufacturing Africa’s medical manufacturing sector lags behind other regions of the world. Countries on the continent import up to 70% of their pharmaceutical products at a cost of $14 billion a year. This reality prompted the AfDB, at the request of the African Union, to earlier this year create the African Pharmaceutical Technology Foundation, a unit that will connect the African pharmaceutical industry with global and regional companies to “share IP-protected technologies, know-how and patented processes.” The AfDB said the move will help it spend at least $3 billion over the next decade to support pharmaceutical and vaccine manufacturing. Nkengasong said PEPFAR will look to tap into such initiatives. The AfDB and Cairo-based Afreximbank could be potential partners. “We started some dialogues with certain banks in the region…because they will be interested,” he said. “I'll give you a very concrete example, the African Development Bank has developed a roadmap for pharmaceutical manufacturing for the continent. So this is not going to be a new discussion, it’s going to be almost a meeting of the minds.” PEPFAR will not raise capital for the banks. Rather, it will commit to buying products from local manufacturers. “If they invest in any companies or countries that produce diagnostics or personal protective equipment, we are committed, as one of the largest buyers, PEPFAR and the Global Fund, to buy those made-in-the-region commodities,” Nkengasong said. PEPFAR will use its substantial buying power as an incentive for manufacturers to enter the regional markets by setting up acquisition targets for local products. The strategy says it will “broker partnerships with development finance and commercial banks to help manufacturers cover upfront costs” as they build up their capacities. PEPFAR will also work with global south governments to beef up the regulatory environments so that local plants meet global medical manufacturing standards. “By catalyzing and accelerating regional manufacturing, PEPFAR will be better positioned to support the procurement, distribution, and implementation of future biomedical innovations, including the possibility of an HIV vaccine and ultimately a cure,” the strategy said. A ‘runway for medical manufacturing’ Former Liberian public works minister W. Gyude Moore told Devex that the intention to scale up regional medical manufacturing shows that the Biden administration is trying to leverage the success of PEPFAR to fill a key gap on the continent. “Imagine if $100 billion they’ve spent was going to medical manufacturing, buying local medical products from African manufacturers,” said Moore, now a senior policy fellow at Washington D.C.-based Center for Global Development. “Attaching PEPFAR provides a runway for medical manufacturing on the continent to thrive.” Nkengasong said that while at Africa CDC, he was inspired when at the height of the COVID-19 pandemic, Afreximbank made available $2 billion to help secure 400 million vaccines for African countries at a time when the continent was struggling to source the drugs. “I said, ‘well, if they can do this during COVID, then we should also engage them and others, like the African Development Bank. The African Development Bank have said in public that they want to invest billions of dollars to strengthen health systems. So, the opportunity is right,’” he told Devex. PEPFAR’s funding and work has helped save 25 million lives from the ravages of the HIV/AIDS epidemic. Its efforts along with partners around the world have contributed to AIDS-related deaths to be cut by 64% since their peak in 2004. New HIV infections have gone down by 52% since their 1997 peak. Around the world, 73% of people living with the disease are able to access antiretroviral therapy, or ART. The program has set a global target that 95% of all people living with HIV should know their status, 95% of all people diagnosed with HIV should receive consistent ART treatment and 95% of all people receiving ART therapy should exhibit viral suppression. It is called the 95-95-95 goal. Challenges to localization Addressing the issue of working with local partners, Nkengasong said PEPFAR is making progress on its target of having 70% of new funding go to entities from the countries of delivery. He did not provide specifics on how close the initiative was to reaching that goal. PEPFAR acknowledged in its new strategy that there have been some “unintended side effects” to its efforts to work with local partners. For example, some international organizations have been found to establish local subsidiaries but have their senior leadership based elsewhere. In other instances, “local partners sub-grant a substantial portion of their capital back to international implementing partners,” PEPFAR said. Nkengasong said they are working to fix these issues but clarified that the drive to localize funding shouldn’t be framed as a fight between local partners versus international organizations. “We shouldn't make it look like any affiliation with a Western partner or a U.S. partner is a bad thing,” he said. “We should look at — What is that partner doing? Are they registered locally? Are they conforming to the norms that we’ve established there? I think that should be the principle guiding the whole concept of strengthening national capacity.” PEPFAR, which was reauthorized by the U.S. Congress in 2018 through 2023, has been flat funded over the last couple of years, Nkengasong said. “We don't have any new funding. We are hoping that and optimistic at the same time that reauthorization will occur and we continue to work with countries that we support to look for domestic financing to sustain the response,” he told Devex. The new strategy, Moore said, hit the right notes. “Most African health ministers will be happy with this strategy,” he said.