Background: The Republic of South Africa (RSA) has the largest national HIV program in the world, with over four million patients on treatment and is the most significant single country procurer of ARVs globally. Given its significant HIV burden, national ownership of funding ARVs, and limited funding envelope, RSA relies heavily on efficient national tendering to ensure cost savings through low prices, while ensuring access to optimal ARVs for patients.
Methods: In August 2018, RSA advertised RT71-2019, a three year ARV tender with effective dates from July 1, 2019 through July 31, 2020. RT17-2019 included 147 million packs of product. For the first time, included within the advertised tender, were ceiling reference prices for ARVs. As an example, RSA employed the innovative pricing agreement for the new, best-in-class product “TLD” at $75 per patient per year. To be competitive, suppliers would be required to bid at or below these prices.
Results: In February 2019, RSA released the awards for RT71-2019. For TLD, the focal ARV for optimizing treatment, the weighted-average price per year for the product was ~$62, a 17% decrease from the global benchmark. On commodities costs alone, when compared to the previous tender, RSA is expected to save over $530 million, which will allow RSA treat an estimated additional 2 million patients.
Conclusions: As national governments start transitioning away from global donor resources for funding ARVs, it is imperative for them to employ efficient national tendering mechanisms. RSA''s approach for tendering, through use of global reference prices and transparent pricing system, could be adopted elsewhere to ensure access to optimal ARVs at affordable prices.



[Total estimated savings due to South Africa''s domestic tendering system and ceiling price agreement]