The Wall Street Journal reports (October 29, subscriber only) that the PEPFAR program is currently paying twice as much for many AIDS drugs as equivalent programs at the Global Fund or World Bank. A principal reason for this is PEPFAR does not yet buy many generic drugs, particularly from India, because they have not received FDA approval. More generic drugs are likely to be approved next year.

The issue of procurement price and practices by PEPFAR will become increasingly important once the $7 billion "Supply Chain Management System" contract is awarded in coming months. In the bidders conference for the contract, USAID official Carl Hawkins made this comment:

And finally -- this has already been stated, but I think it's worth stating -- there will be a high degree of interest in this activity, both inside and outside of government. The way this activity is managed will require, really, complete transparency. I think that it's going to have such visibility that we may have to think about this issue more than with virtually any other project that we've been involved with.

The Global Fund's efforts at transparency around procurement are promising, with their "Price Reporting Mechanism" showing increased data and usage.

Kaiser provides an excellent summary of the PEPFAR drug price issue, including comments from Mark Dybul, Chief Medical Office of the Office of the US Global AIDS Coordinator.