Today at the first reading the Verkhovna Rada of Ukraine has approved the draft laws #2150 and #2151, on the transfer of drug procurement to international organizations. From now on medications for Ukrainian patients for the next 4 years will be procured by 6 international organizations: WHO, UNICEF, IDA Foundation (Netherlands), Crown Agents (UK), Partnership for supply chain management (PFSCM) (USA), Global Drug Facility (GDF) (Switzerland).
“This is a joint victory of the reformers and civil society, which will save lives of many more patients in Ukraine, — says Olha Bohomolets, Chairperson of the Vekhovna Rada Committee on Public Health. — Now we are waiting for the Ministry’s work on the transfer of these functions to the international organizations, so that the procurement procedures can begin soon”.
Public activists and parliamentarians expect that the procurement function will be transferred to the international organizations in 6 weeks already. And the first deliveries will begin in summer of 2015.
Not all the proposals for procurement were supported by the the Ukrainian parliament. Specifically, the draft law #2151 which provided for abolition of 7% VAT and 5% import duty on medicines has not been supported by Committee on Taxation and Customs Policy.
“We did not expect such a decision of the Committee which was a surprise for all of us, — says Olha Stefanyshyna, executive director of “Patients of Ukraine” CF. — Basically MPs suggest that the state taxes itself. It is not clear what it is for. Only one thing is clear: now it is not possible to save as much money as was expected by the law-developers and will greatly complicate the procedure of transfer of drug procurement to the international organizations, because now the Ministry of Health has to enter the process as VAT and import duty payer”.
International non-profit organizations according to its provisions cannot be tax and VAT payers. As a result this function will have to be transferred back to the Ministry of Health.
In addition, transfer of the procurement function to the international non-profit organizations will reduce the price on these medications by 42%. This specifically applies to medications in four treatment programs: HIV, tuberculosis, viral hepatitis and vaccination.
Experts expect that price reduction by 30%will be provided by international packaging and international wholesale prices, extra 7% should be provided by abolition of VAT for medicines which are procured by international organizations and another 5% by cancelation of additional import duty. In general, Ukrainian budget will have extra 348 million by saving 42%. One million vaccines for infants cab be purchased for these money.
“Transfer of procurement to the international organizations is not only the fight against corruption in Ukraine, which was killing hundred thousand Ukrainians every year, but also a chance to combat the epidemic of AIDS and tuberculosis in the country, – says Dmytro Sherembey, Chairman of CF Patients of Ukraine. – With released funds it will be possible to treat 21 thousand of HIV-positive patients and more than 15 thousand of TB patients”
It should be noted that each year, according to the Security Service of Ukraine, during 2012-2014, the prices of medicines that are purchased with the budget costs were 20-40% overestimated.
“Purchases through international organizations – is a chance for Ukraine to receive quality medicines with the money which won’t be used in the corruption schemes, as it was before. For the quality, effectiveness and safety of medicines is responsible WHO, UNICEF and other organizations in the UN system. The relevant European quality of medicines is very important for maintaining the health of the nation. This project is a temporary measure for building transparent and open system of medicines procurement in the country “, – says Iryna Sysoienko, MP Ukraine.
We would like to remind that the authors of the packages of bills #2150 and #2151 are O.Bogomolets (Petro Poroshenko Bloc), V. Siumar (People’s Front), H. Hopko (Union “Samopomich”), M. Ionova (Petro Poroshenko Bloc), O. Korchynska (Oleh Liashko Radical Party), H. Zahorii (Petro Poroshenko Bloc), O. Tretiakov (Petro Poroshenko Bloc), I. Aleksieiev (People’s Front), O. Drozdyk (People’s Front), I. Sysoienko (Union “Samopomich”), K. Yarynich (Petro Poroshenko Bloc), T. Kremin (People’s Front), O. Musii (Petro Poroshenko Bloc).