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Report to the Chairman, Subcommittee on Foreign Operations, Export 
Financing, and Related Programs, Committee on Appropriations, House of 
Representatives: 

July 2004: 

GLOBAL HEALTH: 

U.S. AIDS Coordinator Addressing Some Key Challenges to Expanding 
Treatment, but Others Remain: 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-784]: 

GAO Highlights: 

Highlights of GAO-04-784 a report to the Chairman, Subcommittee on 
Foreign Operations, Export Financing, and Related Programs, House 
Committee on Appropriations:  

Why GAO Did This Study: 

The Presidents Emergency Plan for AIDS Relief (PEPFAR), announced 
January 2003, aims to provide 2 million people with antiretroviral 
(ARV) treatment in 14 of the worlds most severely affected countries. 
In May 2003 legislation established the position of the U.S. Global 
AIDS Coordinator in the State Department. GAO was asked to (1) identify 
major challenges to U.S. efforts to expand ARV treatment in resource-
poor settings and (2) assess the Global AIDS Coordinators response to 
these challenges.

What GAO Found: 

GAO interviewed 28 field staff from the U.S. Agency for International 
Development (USAID) and the Department of Health and Human Services 
(HHS), who most frequently cited the following five challenges to 
implementing and expanding ARV treatment in resource-poor settings: 
(1) coordination difficulties among both U.S. and non-U.S. entities; 
(2) U.S. government policy constraints; (3) shortages of qualified 
host country health workers; (4) host government constraints; and (5) 
weak infrastructure, including data collection and reporting systems 
and drug supply systems (see figure). These challenges were also 
highlighted by numerous experts GAO interviewed and in documents GAO 
reviewed.

Major Challenges to Expanding ARV Treatment in Resource-poor Settings: 

[See PDF for image]

[a] GAO asked all 28 respondents specific questions about 
coordination; respondents raised the other four challenges when 
answering open-ended questions.

[End of figure]

Although the Global AIDS Coordinators Office has begun to address 
these challenges, resolving some challenges requires additional 
effort, longer-term solutions, and the support of others involved in 
providing ARV treatment. First, the Office has taken steps to improve 
U.S. coordination and acknowledged the need to collaborate with 
others, but it is too soon to tell whether these efforts will be 
effective. Second, to address policy constraints, U.S. agencies are 
working to enhance contracting capacity in the field and resolve 
differences on procurement, foreign taxation of U.S. assistance, and 
auditing of non-U.S. grantees. However, the offices guidance did not 
address key issues related to the use of PEPFAR funds to buy certain 
ARV drugs. Third, the Office has proposed short-term solutions to the 
health worker shortage, such as using U.S. and other international 
volunteers for training and technical assistance; however, agency field 
officials said that using such volunteers is not cost effective. The 
office is discussing with other donors certain longer-term 
interventions. Fourth, the Office has taken steps to encourage host 
countries commitment to fight HIV/AIDS, but it is not addressing 
systemic challenges outside its authority, such as poor delineation of 
roles among government bodies. Finally, the office is taking steps to 
improve data collection and reporting and better manage drug supplies. 

What GAO Recommends: 

GAO recommends that the Secretary of State direct the U.S. Global AIDS 
Coordinator to monitor agencies efforts to coordinate with host 
governments and other stakeholders; work with the USAID Administrator 
and HHS Secretary to resolve contracting capacity constraints and any 
negative effects from agency differences on procurement, foreign 
taxation of U.S. assistance, and auditing of non-U.S. grantees; specify 
the activities that PEPFAR can support in national treatment programs 
that use ARV drugs not approved for purchase by the Coordinators 
Office; and work with national governments and international partners 
to address underlying economic and policy factors creating the crisis 
in human resources for health care. State, HHS, and USAID concurred 
with the reports conclusion and said work is underway to address the 
majority of challenges and issues raised. 

www.gao.gov/cgi-bin/getrpt?GAO-04-784.

To view the full report, including the scope and methodology, click on 
the link above. For more information, contact David Gootnick at (202) 
512-3149 or gootnickd@gao.gov.

[End of section]

Contents: 

Letter: 

Results in Brief: 

Background: 

U.S. Government Faces Five Major Challenges to Expanding ARV Treatment 
in Resource-poor Settings: 

Coordinator's Office Has Taken Steps to Address Challenges, but 
Continued Effort Is Needed: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendixes: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: Structured Interview Questions: 

Appendix III: U.S. and International HIV/AIDS Funding: 

Appendix IV: The Structure of the Office of the U.S. Global AIDS 
Coordinator: 

Appendix V: PEPFAR Obligations as of March 31, 2004: 

Appendix VI: Detailed Analysis of Challenges Identified in Structured 
Interviews: 

Appendix VII: Analysis of Difficulty of Coordination: 

Appendix VIII: Joint Comments from the Department of State, HHS, and 
USAID: 

Appendix IX: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Staff Acknowledgments: 

Tables: 

Table 1: Guidance Issued by the Office of the U.S. Global AIDS 
Coordinator to Field Staff on ARV Procurement and PEPFAR Deadlines: 

Table 2: Difficulty Coordinating with Various Groups as Reported by 
Respondents: 

Table 3: Difficulty Coordinating on Various Issues as Reported by 
Respondents: 

Figures: 

Figure 1: Progress toward PEPFAR Goals: Percentages Receiving Treatment 
in Focus Countries as of February 2004: 

Figure 2: Recent International and U.S. Milestones in Efforts to Combat 
AIDS Worldwide: 

Figure 3: U.S. Agencies Involved in PEPFAR: 

Figure 4: Major Challenges to Expanding ARV Treatment in Resource-poor 
Settings: 

Figure 5: U.S. HIV/AIDS Funding in the 14 PEPFAR Focus Countries, Fiscal 
Years 2003 and 2004: 

Figure 6: World Bank, Global Fund, HHS/CDC, and USAID HIV/AIDS Funding 
in the PEPFAR Focus Countries: 

Figure 7: Office of the U.S. Global AIDS Coordinator Organization 
Chart: 

Figure 8: Coordination Challenges Identified by Respondents: 

Figure 9: U.S. Policy Constraints Identified by Respondents: 

Figure 10: Host Country Human Resource Challenges Identified by 
Respondents: 

Figure 11: Host Government Constraints Identified by Respondents: 

Figure 12: Infrastructure and Logistics Challenges Identified by 
Respondents: 

Abbreviations: 

AIDS: acquired immune deficiency syndrome: 

ARV: antiretroviral: 

ARVs: antiretroviral medications: 

CDC: Centers for Disease Control and Prevention: 

FDA: U.S. Food and Drug Administration: 

FDC: Fixed-Dose Combination: 

HHS: Department of Health and Human Services: 

HIV: human immunodeficiency virus (that causes AIDS): 

ICH: International Congress on Harmonization: 

MSF: Medecins sans Frontieres (French NGO Doctors Without Borders): 

NIH: National Institutes of Health: 

NGO: nongovernmental organization: 

PEPFAR: the President's Emergency Plan for AIDS Relief: 

PMTCT: prevention of mother to child transmission: 

TB: tuberculosis: 

UN: United Nations: 

UNAIDS: Joint United Nations Program on HIV/AIDS: 

USAID: U.S. Agency for International Development: 

WHO: World Health Organization: 

Letter July 12, 2004: 

The Honorable Jim Kolbe: 
Chairman, Subcommittee on Foreign Operations, Export Financing, and 
Related Programs: 
Committee on Appropriations: 
House of Representatives: 

Dear Mr. Chairman: 

In January 2003, the President announced an unprecedented 5-year 
initiative to combat the global HIV/AIDS pandemic. The President's 
Emergency Plan for AIDS Relief (PEPFAR), as authorized through the U.S. 
Leadership Against HIV/AIDS, TB and Malaria Act of 2003 (the U.S. 
Leadership Act),[Footnote 1] nearly triples the U.S. financial 
commitment to addressing the disease and targets $9 billion in new 
funding to dramatically expand prevention, treatment, and care efforts 
in 14 of the world's most severely affected countries.[Footnote 2] The 
administration's strategy establishes the goal of supplying 
antiretroviral (ARV) treatment to 2 million HIV-infected people, 
preventing 7 million new HIV infections, and providing care to 10 
million people infected or affected by HIV/AIDS, including orphans. The 
strategy also seeks to streamline the U.S. approach to global HIV/AIDS 
treatment by coordinating and deploying U.S. agencies and resources 
through a single entity, the Office of the U.S. Global AIDS Coordinator 
(the Coordinator's Office), created in January 2004, within the 
Department of State. The U.S. Agency for International Development 
(USAID) and the Department of Health and Human Services (HHS) are 
primarily responsible for implementing PEPFAR overseas.

Whereas previous U.S. programs focused mainly on preventing HIV/AIDS, 
PEPFAR proposes that the U.S. government commit significantly greater 
resources to providing treatment for those infected by the virus. In 
this context, you requested that we (1) identify major challenges to 
U.S. efforts to expand ARV treatment in resource-poor settings and (2) 
assess the U.S. Global AIDS Coordinator's response to these challenges.

To identify challenges to U.S. efforts to expand ARV treatment, we 
conducted 28 structured telephone interviews in December 2003 and 
January 2004 with key staff from USAID and HHS' Centers for Disease 
Control and Prevention (HHS/CDC) in the 14 targeted countries (we 
conducted one USAID and one HHS/CDC interview in each 
country).[Footnote 3] We coded the responses to our open-ended 
interview questions using a set of analytical categories we 
developed.[Footnote 4] We also reviewed numerous documents analyzing 
treatment programs from U.S. government agencies, U.N. organizations, 
and nongovernmental organizations (NGO), including reports by medical 
experts and practitioners. We also interviewed U.S.-based officials 
from USAID and HHS; representatives from multilateral organizations, 
including the World Health Organization (WHO), the Joint United Nations 
Program on HIV/AIDS (UNAIDS), the World Bank, and the Global Fund to 
Fight AIDS, TB, and Malaria (Global Fund); and medical experts 
experienced in treating people with HIV/AIDS in resource-poor settings. 
To assess the U.S. Global AIDS Coordinator's approach to coordinating 
the U.S. response to these challenges, we reviewed the February 2004 
PEPFAR 5-year strategy, administration guidance, and information on the 
emerging structure and initial activities of the Coordinator's Office. 
We also interviewed officials from the Coordinator's Office, USAID, and 
HHS. We conducted our work from July 2003 through May 2004, in 
accordance with generally accepted government auditing standards. (See 
app. I for further details of our scope and methodology and app. II for 
our structured interview questions.) 

Results in Brief: 

U.S. government agencies face five major challenges in expanding ARV 
treatment in resource-poor settings: (1) difficulties coordinating with 
others involved in providing treatment, (2) U.S. government policy 
constraints, (3) shortages of qualified health workers in host 
countries, (4) host government limitations, and (5) weak 
infrastructure. Specifically, our analysis of the structured interviews 
and other documentation revealed the following: 

* Nearly all agency field staff cited problems coordinating with non-
U.S. groups, and slightly fewer cited problems coordinating with other 
U.S. government entities. Limited coordination has led to duplicate 
efforts, confusion regarding standards, and heavy administrative 
burdens.

* Field staff lacked clear guidelines for procuring ARV drugs, which 
made it difficult to plan treatment programs, possibly inhibiting the 
agencies' ability to support country HIV/AIDS treatment programs. Also, 
inadequate contracting capacity in the field may create delays in 
obtaining medical supplies and executing agreements with implementing 
organizations. Further, differences among agencies regarding 
procurement, foreign taxation of U.S. assistance, and auditing of non-
U.S. grantees may inhibit the agencies' joint efforts to expand ARV 
treatment.

* Recipient countries faced critical shortages of qualified health 
workers, including doctors, nurses, and administrators, needed to 
expand ARV treatment.

* In some host governments, limited political commitment to addressing 
HIV/AIDS, poor delineation of roles and responsibilities, and slow 
decision-making processes hamper efforts to expand treatment.

* Many countries have weak systems for monitoring and evaluating health 
care programs; inadequate systems for managing drug supplies; poor 
linkages among programs providing HIV/AIDS services; and deteriorating 
physical infrastructure, including labs, clinics, and roads needed to 
access rural areas.

Although the Office of the U.S. Global AIDS Coordinator has begun to 
address challenges in all areas, some challenges require additional 
effort, longer-term solutions, and the support of others involved in 
providing ARV treatment. Specifically: 

* Coordination. The Coordinator's Office has created mechanisms for 
enhancing coordination within the U.S. government and acknowledged the 
importance of collaborating with others. However, it is too soon to 
tell whether these mechanisms will be effective in resolving the 
coordination challenges field staff identified, and the PEPFAR strategy 
does not state whether the mechanisms will be monitored.

* U.S. government policy constraints. Agencies are exploring ways to 
enhance contracting capacity in the field and address differences 
regarding procurement, foreign taxation of U.S. assistance, and 
auditing of non-U.S. grantees. While the Coordinator's Office did 
provide guidance to U.S. field staff on ARV procurement, this guidance 
did not address key issues--such as specifying activities PEPFAR can 
support in countries that use ARV drugs not approved for purchase by 
the Coordinator's Office--which may affect the U.S. government's 
ability to rapidly expand treatment.

* Shortages of qualified health workers. To address these shortages, 
the Coordinator's Office is focusing on short-term activities, such as 
providing training and technical assistance through paid workers and 
volunteers from the United States and other countries. However, U.S. 
government officials said the use of international volunteers for some 
activities is not cost effective. The Coordinator's Office is also 
developing longer-term interventions, such as increasing health 
workers' compensation, and is discussing with other donors ways to 
implement these efforts. The Coordinator characterized the human 
resource shortage as one of the most important challenges to addressing 
HIV/AIDS.

* Host government constraints. The Coordinator has directed U.S. 
ambassadors and their missions to encourage host countries' commitment 
to fight HIV/AIDS by engaging heads of state, reaching out to community 
and religious leaders, and conducting mass media campaigns. The 
Coordinator's Office has not begun to work with host governments and 
other groups involved in AIDS treatment to address other, systemic 
constraints outside its authority, such as poor delineation of roles 
among host government bodies or slow decision-making processes.

* Weak infrastructure. The Coordinator has assigned a team of experts 
to assess the collection and analysis of data used to monitor and 
evaluate treatment and work with other groups to synchronize data 
reporting systems. The Coordinator is also taking steps to better 
manage drug supplies. However, some field staff expressed differing 
views on implementing a model called for in the U.S. Leadership Act and 
proposed in the PEFFAR strategy to improve health care infrastructure 
and treatment referrals. While the office is working to upgrade labs, 
it has not addressed other physical impediments such as lack of space 
at health facilities. The strategy does not address additional physical 
impediments, such as poor roads, that are outside its direct authority.

To improve the U.S. Global AIDS Coordinator's ability to address key 
challenges to expanding AIDS treatment in PEPFAR focus countries, we 
are recommending that the Secretary of State direct the Coordinator to 
(1) monitor implementing agencies' efforts to coordinate PEPFAR 
activities with host governments and other stakeholders involved in ARV 
treatment; (2) work with the Administrator of USAID and the Secretary 
of HHS to resolve contracting capacity constraints and any negative 
effects from agency differences on procurement, foreign taxation of 
U.S. assistance, and auditing of non-U.S. grantees; (3) specify the 
activities that PEPFAR can fund and support in national treatment 
programs that use ARV drugs not approved for purchase by the 
Coordinator's Office; and (4) work with national governments and 
international partners to address the underlying economic and policy 
factors creating the crisis in human resources for health care.

In providing written comments on a draft of this report, State, HHS, 
and USAID concurred with the report's overall conclusion that while the 
agencies have addressed a number of key challenges in providing 
services, other challenges remain for the medium and long term (see 
app. VIII for a reprint of their comments). Although the agencies did 
not specifically comment on GAO's recommendations, they said work is 
underway to address the majority of challenges and issues raised. They 
also provided technical comments that we have incorporated where 
appropriate.

Background: 

About 40 million people globally were living with HIV/AIDS as of 
December 2003, most of them in sub-Saharan Africa; few have access to 
treatment. Propelled by recent advances in ARV treatment, PEPFAR is the 
first U.S. program to seek to dramatically expand HIV/AIDS treatment in 
resource-poor settings. PEPFAR builds on U.S. bilateral efforts begun 
in June 2002 to prevent mother-to-child transmission of HIV during 
pregnancy, labor and delivery, and breastfeeding. In May 2003, P.L. 
108-25 established the position of the U.S. Global AIDS Coordinator to 
lead the U.S. response to HIV/AIDS abroad; the Senate confirmed the 
Coordinator in October 2003. The office received its initial 
appropriation in January 2004.

AIDS Takes Heavy Toll, Particularly in Africa: 

About two-thirds of those infected with HIV live in sub-Saharan Africa. 
More than 50 percent of all HIV infections in the world, and nearly 70 
percent of HIV infections in Africa and the Caribbean, occur in the 14 
PEPFAR countries. According to WHO, less than 7 percent of the HIV-
infected people in need of ARV drugs were receiving them at the end of 
2003. UNAIDS reports that about 3 million people died from AIDS in 
2003, the vast majority of them in sub-Saharan Africa. The disease has 
decimated the ranks of parents, health-care workers, teachers, and 
other productive members of society in the region, severely straining 
national economies and contributing to political instability.

Recent Advances Allow HIV/AIDS Treatment in Resource-poor Settings: 

Propelled by recent advances in ARV treatment, PEPFAR is the first U.S. 
program to seek to dramatically expand HIV/AIDS treatment in resource-
poor settings. In the 1990s, medical experts found that new forms of 
treatment, involving a combination of three drugs, were effective in 
suppressing the virus and thus slowing progression to illness and 
death. According to medical experts, data from Brazil, Uganda, and 
Haiti showed that patients in resource-poor settings adhere well to 
this complex drug regimen. Adherence to ARV treatment is important: if 
patients do not take the drugs properly or consistently, the virus in 
their bodies may become resistant to the drugs and the drugs will cease 
to be effective. The treatment must continue for life.

Since 2000, the price of ARV drugs has dropped considerably, from a 
high of more than $10,000 per person per year to a few hundred dollars 
or less per person annually, owing in part to the increased 
availability of generic ARV drugs and public pressure. In addition, 
some generic manufacturers[Footnote 5] have combined three drugs in one 
pill--known as fixed-dose combinations, or FDCs[Footnote 6]--thereby 
reducing the number of pills that patients must take at one time. While 
major multilateral and other donors allow recipients of their funding 
to purchase these FDCs, the Office of the U.S. Global AIDS Coordinator 
currently funds only the purchase of drugs that have been: 

approved by a "stringent regulatory authority,"[Footnote 7] citing 
concerns about the quality of drugs that have not demonstrated safety 
and efficacy to such an authority. Presently, only brand-name drugs 
meet this standard.[Footnote 8] As a result, the Coordinator's Office 
does not now fund the purchase of generic ARV drugs, including FDCs. 
However, on May 16, 2004, the HHS Secretary announced an expedited 
process for reviewing data submitted to the HHS/Food and Drug 
Administration (HHS/FDA) on the safety, efficacy, and quality of 
generic and other ARV drugs, including FDCs, intended for use under 
PEPFAR.

To date, only more developed countries have offered ARV treatment on a 
massive scale. The planned expansion of treatment to millions of people 
in developing countries under PEPFAR coincides with international 
efforts to increase the availability of treatment to HIV-infected 
people in poor countries. These efforts include the launch of the 
Global Fund in January 2002[Footnote 9] and a campaign by WHO, 
announced in 2003 on December 1 (World AIDS Day), to provide access to 
ARV treatment to 3 million people by the end of 2005, commonly referred 
to as the "3 by 5" campaign. (See app. III for more information on 
global, including U.S., HIV/AIDS funding.) PEPFAR's goal is to initiate 
ARV treatment for nearly 2 million people in the 14 targeted countries 
by 2008. As of February 2004, a total of 78,921 people, or about 4 
percent of that goal, were receiving ARV treatment in these countries 
(see fig. 1). On April 25, 2004, to synchronize international efforts, 
the Global AIDS Coordinator and his counterparts from UNAIDS, the World 
Bank, the Global Fund, and other bilateral donors voiced their support 
for an international agreement to abide by the following principles: 
(1) that there be one agreed-upon framework for coordinating HIV/AIDS 
activities among all donors and other partners in each recipient 
country; (2) that each recipient country have one national AIDS 
coordinating authority; and (3) that each recipient country have one 
system for monitoring and evaluating AIDS programs.

Figure 1: Progress toward PEPFAR Goals: Percentages Receiving Treatment 
in Focus Countries as of February 2004: 

[See PDF for image] 

[End of figure] 

PEPFAR Builds on Earlier U.S. Efforts to Combat HIV/AIDS Globally: 

PEPFAR builds on U.S. bilateral efforts begun in June 2002 under 
another presidential initiative that focused on preventing mother-to-
child transmission (PMTCT) of HIV during pregnancy, labor and delivery, 
and breastfeeding. This $500 million initiative, formally known as the 
International Mother and Child HIV Prevention Initiative, and more 
commonly referred to as the PMTCT Initiative, focused on the same 14 
countries as PEPFAR. According to administration officials, the 
countries were selected based on the severity of their HIV/AIDS burden, 
the extent to which they have a substantial U.S. government presence, 
the effectiveness of their leadership, and foreign policy 
considerations. The initiative focuses on treatment and care for HIV-
infected pregnant women and provides a short course of ARV treatment 
that has been shown to be 50 percent effective in lowering the risk of 
transmission of the virus in breast-feeding mothers.[Footnote 10] With 
the establishment of the Coordinator's Office, PMTCT Initiative funding 
and activities were included in PEPFAR. (See fig. 2 for a timeline of 
international and U.S. efforts to combat HIV/AIDS worldwide.) 

Figure 2: Recent International and U.S. Milestones in Efforts to Combat 
AIDS Worldwide: 

[See PDF for image] 

[A] P.L. 108-7, Consolidated Appropriations Resolution, 2003.

[B] P.L. 108-199, Consolidated Appropriations Act, 2004.

[End of figure] 

The agencies primarily responsible for implementing PEPFAR are the 
State Department, where the U.S. Global AIDS Coordinator is based and 
reports directly to the Secretary of State; USAID; and the Department 
of Health and Human Services (HHS). The Coordinator plays an overall 
coordinating role, and the State Department raises HIV/AIDS issues 
through diplomatic channels and public relations campaigns. USAID 
maintains overseas missions in 12 of the 14 PEPFAR focus countries, 
with personnel trained in procurement and managing grants to foreign 
entities; it works with NGOs and other entities. HHS's overseas 
presence is focused on providing technical assistance and is more 
recently initiated. HHS/CDC provides clinicians, epidemiologists, and 
other medical experts who generally work directly with foreign 
governments, health institutions, and other entities. Within HHS, 
PEPFAR also draws on expertise from the National Institutes of Health/
National Institute of Allergy and Infectious Diseases, which is 
involved in HIV/AIDS research in PEPFAR focus countries; the Health 
Resources and Services Administration, which has experience expanding 
HIV/AIDS and other health services in resource-poor settings in the 
United States and is providing some assistance in several PEPFAR focus 
countries; and the Office of the Secretary/Office of Global Health 
Affairs, which plays a coordinating role on HIV/AIDS within 
HHS.[Footnote 11] Other agencies involved in PEPFAR are the Department 
of Defense, which works on HIV/AIDS issues with foreign militaries, 
helps construct health facilities, and conducts some research and 
program activities in PEPFAR focus countries; the Peace Corps; and the 
Departments of Labor and Commerce, which are involved in HIV/AIDS-
related activities in the workplace and with the private sector, 
respectively. (See fig. 3.) 

Figure 3: U.S. Agencies Involved in PEPFAR: 

[See PDF for image] 

[End of figure] 

Global AIDS Coordinator's Office Established, Implements Funding 
Mechanisms: 

In May 2003, the U.S. Leadership Act established the position of the 
U.S. Global AIDS Coordinator "to operate internationally to carry out 
prevention, care, treatment, support, capacity development, and other 
activities for combating HIV/AIDS;" the Senate confirmed the 
Coordinator in October 2003. (See app. IV for detailed information on 
the structure of this office.) The Coordinator has been granted 
authority to transfer and allocate the funds appropriated to his office 
among the U.S. agencies implementing PEPFAR in the 14 focus countries 
and additional bilateral HIV/AIDS programs in other countries. The U.S. 
Leadership Act authorizing PEPFAR states that not less than 55 percent 
of the amount appropriated pursuant to section 401 of the act is to be 
spent on treatment and that at least three-quarters of that amount 
should be spent on the purchase and distribution of ARV drugs for 
fiscal years 2006 through 2008. Of the remaining 45 percent, 20 percent 
should be spent on prevention, 15 percent on palliative care, and 10 
percent on orphans and other vulnerable children.

Congress appropriated $488 million for the Coordinator's Office in 
fiscal year 2004, and the President requested $1.45 billion for fiscal 
year 2005. The office was formally established in January 2004. It 
created three mechanisms, or funding "tracks," to allocate money: track 
1, track 1.5, and track 2. Tracks 1 and 1.5 are one-time mechanisms 
that rapidly allocated funds to expand ongoing activities through 
Washington, D.C.-based multicountry awards and locally based country-
specific awards, respectively. Track 2 serves as an annual operational 
plan for each country. A portion of the funds for tracks 1 and 1.5 were 
obligated by a target date of January 20, 2004 and the remainder were 
obligated by mid-February following congressional notification;
[Footnote 12] budgets for track 2 were submitted to the Coordinator's 
Office for review on March 31, 2004, and approved on a rolling basis 
through early May. Pending congressional review, the Coordinator's 
Office expects that agencies will have begun to obligate these funds by 
the end of June. PEPFAR activities are generally executed through 
procurement contracts or through grant agreements or cooperative 
agreements with implementing entities such as NGOs and ministries of 
health (and/or national AIDS control programs).[Footnote 13] (See app. 
V for additional information on initial obligations.) 

U.S. Government Faces Five Major Challenges to Expanding ARV Treatment 
in Resource-poor Settings: 

In our structured interviews, we identified the following major 
challenges to U.S. government agencies in expanding ARV treatment in 
resource-poor settings: (1) difficulties coordinating with other groups 
involved in combating HIV/AIDS; (2) U.S. government policy constraints; 
(3) shortages of qualified health workers; (4) host government 
constraints; and (5) weak infrastructure (see fig. 4). These challenges 
were also highlighted by numerous government and nongovernment experts 
whom we interviewed and in documents we reviewed. (See app. VI for 
additional analysis of these challenges.) 

Figure 4: Major Challenges to Expanding ARV Treatment in Resource-poor 
Settings: 

[See PDF for image] 

[A] We asked all 28 respondents specific questions about coordination; 
respondents raised the other four challenges when answering open-ended 
questions. See app. I for a more detailed description of how we 
identified these five main challenges.

[End of figure] 

U.S. Government Faces Challenges Coordinating ARV Treatment Programs: 

All of the field staff we interviewed in the 14 PEPFAR countries 
identified problems coordinating with other groups. Nearly all cited 
problems coordinating with non-U.S. government groups, and slightly 
fewer cited problems coordinating with other U.S. government entities. 
Consequences of the coordination problems cited by field staff include 
duplicate efforts, confusion over standards, and heavy administrative 
burdens.

Almost All Field Staff Cited Difficulty Coordinating with Non-U.S. 
Groups: 

Twenty-seven of 28 respondents cited challenges coordinating with non-
U.S. government groups, particularly with host governments and 
multilateral organizations.

Just over three quarters (22 of 28) of the field staff we interviewed 
provided examples of challenges to coordination between the U.S. 
government and the host governments in the PEPFAR focus countries. One 
of the most commonly cited challenges dealt with host governments' 
perceptions. Field staff said that host government officials are often 
skeptical of donors' intentions and may question the commitment of 
donors and the sustainability of new treatment programs, especially 
when they think that donors are promoting programs that run counter to 
their national strategies. Similarly, an NGO official working with the 
host government in one of the 14 PEPFAR focus countries reported that 
when initial funding plans were created, U.S. field staff for the 
country ignored existing government and NGO programs. The official said 
that the plans for this country also did not incorporate any funding 
for training, which was a stated government priority. In addition, 
consulting the host government only after funding applications were 
completed has increased government officials' skepticism regarding U.S. 
intentions and programs in this country, according to U.S. field staff. 
Field staff also noted that it is difficult to coordinate with host 
governments owing to the governments' limited human resource capacity. 
In addition, staff are often hindered by the governments' slow 
bureaucratic practices and lack of understanding of U.S. and other 
donors' programs and policies. Field staff commented that all of these 
problems, paired with expedited PEPFAR timelines and consequently 
compressed consultation time, could increase the challenges faced by 
the United States in persuading host governments to support PEPFAR 
plans for expanded treatment. Field staff generally reported the most 
difficulty coordinating with host governments and multilateral 
organizations (see app. VII).

Sixteen of 28 field staff identified coordination challenges with 
multilateral organizations (such as the World Bank, the Global Fund, 
WHO, and other U.N. organizations), with many citing perception issues. 
Because of the influx of PEPFAR funding, the United States will 
significantly increase its financial investment in treatment programs, 
potentially causing other donors to see themselves as overshadowed. 
Staff noted that before the United States instituted the PMTCT 
Initiative, UNICEF was the main implementer of these programs. 
According to field staff we interviewed, when the United States 
expanded its own programs, UNICEF and other donors felt "steamrolled" 
by programs that were quickly put in place by the United States with 
little input from the donor community. Some U.S. staff said that PEPFAR 
is replicating this unilateral approach. According to these staff, the 
perception that the United States acts unilaterally is compounded by 
the fact that, unlike many other donors, U.S. agencies are not allowed 
to contribute money to other donors' programs or to pooled host 
government funding "baskets" for the health and other sectors. The 
staff noted that some donors therefore indicated that the United States 
is willing to create duplicative programs. Staff frequently cited the 
need for the United States to work with the WHO as both the PEPFAR 
program and WHO's 3-by-5 campaign begin.[Footnote 14] Staff said that 
such coordination is needed to minimize overlapping efforts, confusion 
over standards, and the administrative burden on host governments and 
other donors.

Finally, while some staff noted that they have not had enough time to 
coordinate efforts, many said that all stakeholders need to harmonize 
specific aspects of treatment programs--including treatment 
guidelines, training schedules and materials, technical approaches, 
educational and media campaigns, procurement policies, hiring and 
payment policies, and the collection and reporting of data. The staff 
indicated that without harmonization, unnecessary duplication and 
confusion could occur as treatment programs are expanded.

Field Staff Cited Challenges Coordinating with Headquarters and Other 
U.S. Agency Field Offices: 

Twenty-four of 28 respondents cited challenges in coordinating with 
other U.S. government agencies, their agency's headquarters, or the 
Coordinator's Office in Washington, D.C. Twenty-two of the field staff 
we interviewed told us that they face challenges coordinating with 
headquarters, and 15 of 28 said that they face challenges coordinating 
with other U.S. government agencies in the field. These challenges were 
also cited in documents field staff prepared for the Global AIDS 
Coordinator.

Field staff reported that headquarters did not coordinate with them 
early in the process of developing activities for the PMTCT Initiative 
and PEPFAR. For example, they expressed concern that headquarters 
announced intended programs without first notifying staff in the field 
or giving them the opportunity to discuss the PMTCT Initiative and 
PEPFAR programs with host governments. Field staff stated that 
government officials in these countries often regarded such 
announcements as statements of commitment rather than intention, 
resulting in overly optimistic expectations of the amounts of funding 
they might receive from the United States. Also, headquarters' limited 
coordination with field staff has made it more difficult for U.S. 
officials in-country to work with host governments, increasing these 
governments' perception that the United States is imposing programs on 
them rather than seeking their commitment or concurrence, which could 
impede U.S. efforts to expand ARV treatment.

In addition, when discussing coordination problems between the field 
and headquarters, most field staff said that they were burdened by 
administrative requirements, during both the PMTCT Initiative and the 
initial stages of the PEPFAR planning. For example, eight respondents 
stated that they rushed to complete multiple reporting requirements 
that were often unclear or redundant. This point was also made in 
several written communications from the field to the Coordinator's 
Office. Three respondents stated that at the same time they were trying 
to work with their agency counterparts in the field to complete 
integrated reporting requests from the Coordinator's Office, they were 
asked by headquarters to prepare duplicative, agency-specific reports, 
which further compounded their burden. Five respondents indicated that 
the time spent responding to these requests within the period allotted 
has directly limited their ability to implement treatment programs.

Just over half (15 of 28) field staff also identified coordination 
challenges among agencies in the field. Most staff that raised 
interagency issues cited challenges arising from the different 
agencies' roles--for example, HHS/CDC has traditionally provided 
technical assistance directly to foreign governments through 
cooperative agreements, while USAID has focused on development, 
primarily by managing grant agreements implemented by NGOs. Staff 
further stated that as the programs become more coordinated, challenges 
could arise from agencies' differing administrative procedures. For 
example, agencies may have different procurement or hiring policies; 
agencies entering a program area may find themselves competing with 
another agency previously dominant in that area; and field staff busy 
with administrative tasks and program implementation may find little 
time to communicate with their field counterparts.

U.S. Policy Constraints Limit Agencies' Ability to Rapidly Expand 
Treatment Programs: 

Twenty-five of the 28 structured interview respondents identified U.S. 
policy constraints as a challenge that could limit the ability of the 
agencies implementing PEPFAR to rapidly expand treatment programs. In 
particular, unclear guidance on whether U.S. agencies can purchase 
generic ARV drugs, including FDCs, makes it difficult for the PEPFAR 
agencies to plan support for national treatment programs, some of which 
use these drugs. In addition, field staff raised concerns that their 
current contracting capacity will not be sufficient to manage the large 
influx of funds expected under PEPFAR. Further, differing laws 
governing the funds appropriated to these agencies--affecting 
procurement standards and foreign taxation of U.S. assistance--and 
varying grant requirements used by the agencies may challenge their 
joint efforts to expand ARV treatment programs.

Unclear Guidance on ARV Procurement Complicates PEPFAR's Ability to 
Support Country Treatment Programs: 

Twenty-one respondents indicated that they had not received adequate 
guidance on the procurement of ARV drugs, which makes it difficult for 
the U.S. missions to plan their support of country programs. At least 
four of the national programs in the PEPFAR focus countries are 
currently purchasing generic ARV drugs with their own funds or with 
funds from the Global Fund[Footnote 15] or other sources, and other 
countries are considering purchasing them. In addition, in other PEPFAR 
countries, NGOs such as Mdecins sans Frontires (Doctors Without 
Borders) are also purchasing generic ARV drugs. Given this situation, 
and the fact that USAID and HHS/CDC have different procurement 
standards, one USAID official in Africa stated that adhering to the 
agency's current standards, which generally require that USAID-financed 
pharmaceuticals be produced in and shipped from the United 
States,[Footnote 16] will present a challenge as more governments 
purchase generic FDCs to boost adherence. An HHS/CDC official in the 
same country stated that the host government is buying these drugs with 
Global Fund money and training doctors and pharmacists to support this 
regimen. He said that it would complicate the country's ability to 
expand treatment if the United States is not able to support such a 
regimen.

In addition, in communications to the Global AIDS Coordinator in mid-to 
late-2003, U.S. government officials in several PEPFAR focus countries 
requested guidance regarding local procurement of ARV drugs. A 
September 18, 2003, communication from Ethiopia observed that several 
local companies are poised to produce generic ARV drugs, and an October 
8, 2003, communication from Uganda stated that generic drugs are 
available at much lower prices than brand-name drugs. The Uganda 
communication also stated that procurement of nonlocal goods or 
services (e.g., U.S. brand-name ARV drugs) to implement PEPFAR will 
undermine PEPFAR's goal of enhancing local capacity to fight HIV/AIDS.

Field Staff Concerned That Current Contracting Capacity Is Insufficient 
to Manage PEPFAR Funds: 

Almost half (13 of 28) of the structured interview respondents, 
primarily from HHS/CDC, stated that contracting capacity in the field 
is a problem. According to documents submitted to the Coordinator's 
Office, U.S. government field staff in four countries expressed the 
need for increased contracting capacity to process procurement of goods 
and services, such as medical equipment, and increased capacity to 
award and administer contracts, grant agreements, and cooperative 
agreements with implementing organizations to allow rapid expansion of 
treatment under PEPFAR. Further, a June 2003 communication summarizing 
lessons learned from the PMTCT Initiative[Footnote 17] stated that HHS/
CDC, which uses the embassy contracting system, has experienced 
considerable delays, funding level ceilings, and other difficulties in 
processing contractual transactions. HHS/CDC uses the embassy 
contracting system because it does not have contract officers in the 
field. The communication stated that these difficulties raise concerns 
that the embassy system will not be able to handle the number of 
contracts and inflow of funds needed to expand treatment under PEPFAR.

Two HHS/CDC respondents cited embassy spending limits as a problem. One 
HHS/CDC respondent explained that the embassy in his country can 
process purchase orders for up to $100,000 but that orders exceeding 
that amount require additional consultation in Washington, a process 
that can take 4 to 6 months. He added that the $100,000 ceiling will be 
reached quickly under PEPFAR[Footnote 18] and that the embassy 
procurement system is designed for buying items like furniture rather 
than evaluating, awarding, and managing long-term contracts or grant 
agreements with implementing partners. Another HHS/CDC respondent 
stated that it takes time to familiarize embassy personnel with the 
specifications for certain medical equipment related to ARV treatment. 
Moreover, he stated that if the equipment is specialized, it may have 
only one supplier, causing additional delays for the embassy to justify 
sole sourcing. When questioned about these examples, HHS/CDC contract 
officers at headquarters stated that a time frame of several months is 
not unusual and that the process could take just as long regardless of 
whether it went through the embassy, HHS/CDC headquarters, or an HHS/
CDC field office.

Although HHS/CDC field staff articulated more concerns regarding 
inadequate contracting capacity in the field, the PMTCT Initiative 
summary stated that the current number of USAID contract officers in 
the field will be insufficient to facilitate the number of contracts 
and large amount of funds needed to meet PEPFAR treatment goals. 
Another communication, dated December 5, 2003, spoke of "an urgent plea 
for greater contracting officer support," and a third communication, 
dated October 16, 2003, cited "a desperate need for contracting agents 
in-country." In addition, a USAID respondent in one country and HHS/CDC 
respondents in three countries stated that more staff in general are 
needed in the field to expand treatment under PEPFAR.

The PMTCT Initiative summary and a communication from Botswana to the 
Coordinator's Office offered several suggestions for addressing the 
problem. These suggestions included changing the contracting system or 
increasing the number of contract officers in the field and 
strengthening USAID regional contracting offices with additional 
personnel and capacity to travel to countries in their region. The 
PMTCT Initiative summary also recommended that HHS/CDC and its parent 
agency, HHS, work with the Department of State to review current 
contracting mechanisms and develop strategies that will allow for 
greater flexibility and capacity to program PEPFAR funds. According to 
technical comments on a draft of this report that were submitted 
jointly by the Coordinator's Office, HHS, and USAID, the funding 
requests required of field staff for track 1.5 (rapid allocation of 
funds to expand ongoing activities) and track 2 (annual operational 
plans) specifically asked what additional contracting support field 
staff would need, and some posts have been allotted staffing positions 
to help fill these gaps.

Differing Laws and Regulations May Inhibit Agencies' Joint Efforts to 
Expand Treatment Programs: 

The agencies implementing PEPFAR are subject to varying laws and 
regulations regarding procurement and foreign taxation of U.S. 
government assistance, as well as differing grant requirements for 
audits of grantees. These differences may cause confusion among NGOs--
particularly if they are not U.S. organizations--receiving grants from 
several agencies to implement PEPFAR.

Agencies Have Different Procurement and Taxation Rules: 

USAID and HHS agencies, such as HHS/CDC and the National Institutes of 
Health (HHS/NIH), may require their grantees to use different 
procurement standards owing to the agencies' different appropriations 
legislation and operating procedures.[Footnote 19] In South Africa, for 
example, according to USAID officials in that country, the mission 
obligated all of its money for drug procurement under PEPFAR track 1.5 
through the HHS/NIH; that agency's funds are governed by less 
restrictive rules for overseas procurement, and HHS/NIH was therefore 
able to allocate the money quickly to meet a January 2004 deadline. In 
a January 2004 communication submitted to the Coordinator, officials in 
that country raised questions regarding the application of different 
procurement rules. Interview respondents in two other African countries 
also raised these questions.

Similarly, the South African communication to the Coordinator raised 
questions concerning the application of rules on foreign taxation 
restrictions. Section 506 of the Foreign Operations, Export Financing 
and Related Programs Appropriation Act for 2004 (the 2004 Foreign 
Operations Appropriations Act) prohibits funds appropriated by the act 
to be used to provide assistance for a foreign country under a new 
bilateral assistance agreement unless the agreement exempts the 
assistance from taxation.[Footnote 20] In addition, the provision 
states that when a host country assesses taxes on U.S. assistance 
provided under the act, an amount equal to 200 percent of the total 
assessment shall be withheld from the fiscal year 2005 appropriations 
for assistance to that country. Since this restriction applies only to 
funds appropriated under the 2004 Foreign Operations Appropriations 
Act, it does not affect funds appropriated to HHS agencies in their own 
appropriations acts. According to the communication from the field and 
interviews we conducted with the procurement and legal officials who 
contributed to it, there could be confusion among agencies and grant 
recipients over managing funds provided under different appropriations 
laws, since some of the funds are subject to the taxation provision and 
some are not.

In addition, there was initial confusion over what restrictions would 
apply to money appropriated to the Coordinator's Office and transferred 
to HHS agencies. Since funding for the Coordinator's Office was 
appropriated under the 2004 Foreign Operations Appropriations Act, 
certain restrictions apply to these funds, including the taxation 
provisions discussed above and procurement restrictions in the Foreign 
Assistance Act of 1961. Officials from the Coordinator's Office told us 
that they recently determined that funds transferred to agencies from 
that office would still be subject to their original appropriations 
restrictions. In contrast, funds appropriated directly to HHS for 
PEPFAR-related activities are not subject to these restrictions. We 
spoke with the authors of the South African communication and an HHS/
CDC grantee, who raised concerns over managing funds that may be 
subject to differing restrictions. They stated that grantees could be 
confused by differing sets of rules. The grantee, a U.S. organization, 
also noted that non-U.S. grantees often lack the resources to ascertain 
what these rules require. According to HHS officials, the Coordinator's 
intention is to set one policy for all U.S. government agencies 
implementing PEPFAR.

Agency Requirements for Auditing Grantees Vary: 

Agencies have varying grant requirements regarding the auditing of 
foreign recipients of U.S. funds, possibly complicating the agencies' 
oversight of organizations implementing PEPFAR. Office of Management 
and Budget circular A-133 provides uniform auditing standards 
applicable to all U.S. government agencies with respect to grants 
awarded to U.S. entities. However, it does not apply to non-U.S. 
entities that receive funds directly as grant recipients or indirectly 
as subrecipients. U.S. government officials expect that many such 
entities will implement PEPFAR. USAID officials noted that their agency 
requires that any local (i.e., non-U.S.) grantee spending more than 
$500,000 in U.S. government funds per year be audited annually, for 
example, by a preapproved local audit firm in accordance with U.S. 
government auditing standards. HHS/CDC's audit requirements for non-
U.S. grantees differ from USAID's in that audits must be performed by a 
U.S.-based firm (which, according to USAID audit officials, could be 
expensive).[Footnote 21] HHS/CDC's audit requirements for non-U.S. 
grantees also state that audits must be performed according to 
international accounting standards or standards approved by HHS/CDC. 
The January communication from South Africa requested that these 
differences be worked out quickly so that field staff can incorporate 
appropriate language and cost implications in grant agreements 
currently being negotiated with organizations that will be implementing 
PEPFAR.

Insufficient Host Country Human Resources Hinder ARV Treatment 
Expansion: 

Insufficient host country human resources critically challenge U.S. 
efforts to implement and expand AIDS treatment, according to agency 
officials in 23 of our structured interviews as well as key documents 
we reviewed. Inadequate training; high staff turnover, due in part to 
low compensation; and national policies and regulations limiting the 
use and hiring of doctors all contribute to human resource constraints 
in the PEPFAR countries.

U.S. and Multilateral Sources Cited Host Country Worker Shortages: 

U.S. field staff in 18 of 28 structured interviews identified shortages 
of trained host country personnel, including doctors, nurses, and 
administrators, as a major limitation to U.S. efforts to expand ARV 
treatment. In addition, three officials working with the Coordinator's 
Office identified the human resource shortage as a critical issue that 
could impede the success of PEPFAR. Further, an assessment of four AIDS 
treatment sites in Kenya by Family Health International and Management 
Sciences for Health[Footnote 22] found that all sites were operating at 
half the recommended staffing levels. Multilateral and bilateral 
organizations have also reported on health personnel shortages. A joint 
World Bank-WHO paper stated that in many poor countries, the number of 
health workers is grossly insufficient for the widespread 
implementation of a minimum of lifesaving interventions,[Footnote 23] 
and a separate WHO paper stated that shortages of human resources are a 
major constraint to expanding HIV/AIDS treatment and care.[Footnote 24] 
For example, the size of the health workforce in Tanzania must triple 
by 2015 to deliver health care, including HIV/AIDS treatment, to the 
majority of the population, according to a report funded by the United 
Kingdom Department for International Development.[Footnote 25] While 
accurate data are difficult to obtain, WHO data indicate wide variances 
in the numbers of doctors and nurses in the 14 countries. Even in 
Botswana, one of the 14 countries reporting the highest number of 
doctors per capita, field staff reported a shortage of trained doctors 
who can provide ARV treatment.

The country's president cited human resource constraints as one of the 
major challenges to introducing ARV treatment in Botswana.[Footnote 26]

Inadequate Training of Workers Hinders ARV Treatment Expansion: 

Half of the field staff we interviewed said that in the countries where 
they work, insufficient numbers of personnel are adequately trained to 
facilitate expansion of ARV treatment. According to a USAID-funded 
paper, low-quality nursing and medical training schools inhibit the 
countries' ability to produce qualified providers.[Footnote 27] In 
addition, an HHS/CDC official in one African country cited lack of 
public health training as a key challenge to expanding AIDS treatment 
in that country. A Coordinator's Office official and UNAIDS officials 
stated that limited human capacity inhibits the ability of PEPFAR 
countries to monitor and evaluate ARV treatment, and an advisor to a 
national AIDS program in another African country stated that staff at 
the national drug procurement center are not properly trained and that 
as a result, the center has experienced shortages of health supplies.

Moreover, donor efforts to improve the skills of health workers through 
training are not well coordinated, according to USAID and HHS/CDC 
officials in the field. Lack of coordination results in duplicative 
training materials or different messages, according to an HHS and WHO 
official respectively. Further, the World Bank-WHO paper notes that 
payment of high per diems by donors to ensure attendance at workshops 
and seminars distracts managers and staff from their work. In addition, 
the USAID-funded report stated that donors traditionally have focused 
more on short-term rather than longer-term interventions such as 
helping to develop and improve medical, nursing, and other technical 
schools.

High Turnover Exacerbates Shortages: 

According to agency field staff and multilateral and other U.S. 
sources, high turnover of health services personnel is a significant 
factor contributing to the shortage of health workers in PEPFAR 
countries, hindering the delivery and expansion of ARV treatment. Seven 
respondents cited high staff turnover as a challenge, and of these 
seven, four cited low public sector pay as a factor leading to 
turnover. Written documents from field staff also stated that low 
public sector pay contributes to turnover. For example, the USAID-HHS/
CDC Fiscal Year 2004 PMTCT Initiative Implementation Plan for Rwanda 
stated that rapid turnover of personnel, due to noncompetitive public 
sector salaries, "burnout," and the loss of trained health-care workers 
from the public sector, affects the health ministry's ability to 
advance programs. Further, the document anticipated that personnel 
issues will constitute a major challenge to expanding ARV treatment in 
that country. A USAID-funded study reported that, in some cases, health 
care providers leave the public sector to earn higher salaries in the 
private sector or with NGOs.[Footnote 28] Similarly, the President of 
Botswana said that the country's national ARV program lost skilled 
health and other workers to NGOs and development partners, who pay 
higher salaries than the government. Three U.S. field staff we spoke 
with emphasized the need for donors to coordinate on common policies 
regarding salaries for health workers. Likewise, a World Bank expert 
and a WHO official suggested that donors should develop policies to 
supplement salaries for public health workers to help alleviate the 
shortages.

Worker emigration and death from AIDS among health workers also 
contribute to staff shortages. World Bank and WHO reports noted that 
low pay and poor working conditions contribute to the migration of 
skilled health workers from resource-poor countries. WHO reported that 
one-quarter to two-thirds of health care professionals interviewed in 
some African countries expressed an intention to emigrate to other 
countries.[Footnote 29] The report identified lack of training and 
career opportunities, poor pay and working conditions, and political 
conflicts and wars as the main factors leading to emigration. In 
addition, according to a May 2004 WHO report, AIDS deaths have 
dramatically increased among the health workforce throughout the 
developing world.[Footnote 30]

National Policies and Regulations Limit Use and Hiring of Doctors: 

Host governments' national policies and regulations regarding the use 
and hiring of doctors limit the number of health services personnel 
available to provide ARV treatment. For example, U.S. government 
officials in one country said that a policy requiring that only doctors 
treat AIDS patients represented the greatest obstacle to expanding 
treatment. Documentation on the national ARV program in that country 
recommended devolving responsibility to lower level staff, but 
mentioned that labor issues could hinder this. In another country, 
according to a U.S. official, hiring doctors in the public sector can 
take 6 months to a year.

Host Government Constraints Inhibit Expansion of ARV Treatment: 

Rapid expansion of treatment has been impeded by host government 
constraints, including, in some countries, limited political commitment 
to combating HIV/AIDS, poor delineation of roles among government 
bodies responsible for addressing HIV/AIDS, and slow decision-making 
processes, according to 19 of the structured interview respondents and 
written communications to the Coordinator's Office from the field.

Limited Political Commitment Hampers Treatment Expansion: 

Eleven of the 28 respondents cited lack of political commitment to 
address HIV/AIDS as a major challenge. According to U.S. officials 
working in one country, despite proclamations at the highest levels 
that HIV/AIDS constitutes an emergency, it is not treated as such. They 
noted that they have great difficulty getting a response from the 
government, which tends to be slow and bureaucratic, and that the 
health ministry has never been powerful or well funded. Similarly, 
USAID officials in another country said that although there are strong 
leaders at the health ministry's HIV/AIDS and TB division, weak 
leadership at higher levels in the ministry has made it difficult to 
advance programs. A joint U.S. government communication, dated 
September 18, 2003, from a third country stressed the urgent need for 
high-level political commitment to assure that ministries provide 
sufficient oversight and staff for effective programming. Conversely, 
staff in a fourth country stated that political will to address HIV/
AIDS has been demonstrated by the central government but not at the 
local level, where much of the program implementation will occur.

Poor Delineation of Roles Impedes Expansion Efforts: 

A quarter of the respondents (7 of 28) cited institutional constraints, 
such as poor delineation of roles between government bodies responsible 
for addressing HIV/AIDS, as an impediment to expanding treatment. For 
example, a U.S. official in one country said that the lack of a clear 
distinction and definition of roles and responsibilities within the 
ministry of health and weak management structure constrained his 
efforts to implement the PMTCT Initiative. A U.S. official in another 
country reported difficulty working with the host government because 
several different government entities have responsibility for HIV/AIDS, 
with no clear reporting hierarchy. Further, HHS/CDC officials in a 
third country voiced concern about friction between the health minister 
and the AIDS minister regarding the control of money from the World 
Bank. The HHS/CDC officials are concerned that the disagreement might 
result in two separate coordinating mechanisms, causing duplication of 
efforts.

Slow Decision-Making Processes Delay Rapid Expansion: 

Four respondents from our structured interviews cited host governments' 
slow decision-making processes as a key challenge to rapidly expanding 
ARV treatment. For example, according to a U.S. government official in 
one country, extensive consultation and discussion delayed programmatic 
and management decisions, slowing implementation of the PMTCT 
Initiative. Similarly, HHS/CDC officials in another country said that 
country's tradition of consensus-based decision-making requires a great 
deal of consultation and thus inhibits the country's ability to quickly 
address situations such as the AIDS epidemic. According to the 
officials, this slowness was the major challenge in implementing the 
PMTCT Initiative in that country. However, the officials also stated 
that consensus-based decision-making reduces opportunities for 
corruption, a problem reported by U.S. officials in four countries as a 
challenge to implementing programs. An HHS/CDC official in a third 
country reported that decision making is slow because several levels of 
officials have to approve even routine decisions.

Weak Infrastructure Hinders Expansion of Treatment: 

HHS/CDC and USAID field staff in 16 of 28 structured interviews cited 
weak infrastructure in host countries as an impediment to implementing 
and expanding ARV treatment. Specifically, they noted weak systems for 
gathering information needed to monitor and evaluate programs; 
inadequate systems for managing the drug supply; poor linkages among 
HIV/AIDS programs and between these programs and basic health care 
infrastructure; and insufficient physical infrastructure, including 
health facilities, roads, and water supply.

Information Infrastructure Is Weak: 

In 8 of the 28 structured interviews, HHS/CDC and USAID field staff 
stated that the infrastructure needed for monitoring and evaluating 
treatment programs is weak. For example, field staff in one country 
stated that the national AIDS control program's indicators and data 
collection methods are not sufficient to identify populations infected 
with HIV, and staff in a second country said that that inadequate 
feedback to those who administer services or collect data hampers the 
improvement of programs. Staff from this country also stated that 
agencies' differing methods of reporting activities make determining 
data accuracy difficult. In addition, U.S. agency documents from PEPFAR 
countries indicated the need for better data collection tools, feedback 
of analysis and data to district and community facilities, behavior 
change to increase the value placed on data, and monitoring of the 
impact of programs as AIDS treatment expands.

A joint WHO-World Bank paper also emphasized the need to improve health 
information systems at local, national and international 
levels.[Footnote 31] Moreover, half or more of the structured interview 
respondents indicated that they experienced moderate or greater 
difficulties in harmonizing data collection methods and reporting 
requirements with other stakeholders involved in AIDS treatment (see 
app. VII). According to officials from the U.S. government, WHO, and 
UNAIDS, there is general international consensus on what data should be 
collected[Footnote 32] but less consensus regarding how the data should 
be collected and reported.

Systems for Managing Drug Supply Are Inadequate: 

Eight of 28 interview respondents said that the infrastructure needed 
to manage and deliver drug supplies in their countries is inadequate, 
complicating efforts to expand ARV treatment. Respondents in several 
countries commented on, among other things, the difficulty of 
maintaining a reliable supply of drugs and basic health commodities; a 
lack of infrastructure for distributing and storing drugs and other 
commodities and the absence of a sound commodity management information 
system; and a protracted ARV shortage that could lead to drug 
resistance in thousands of affected patients. In one country, fear of 
being penalized has kept the government's agency for procuring drugs 
and related items from sharing information on drug shortages, thereby 
exacerbating the problem and inhibiting efforts to address it, 
according to an advisor to the national AIDS program.

Poor Program and System Linkages Inhibit Treatment Expansion: 

According to six interview respondents and written communications to 
the Coordinator's Office from five countries, poor linkages among 
programs providing HIV/AIDS services inhibit the expansion of these 
services. For example, U.S. officials in one country stated that the 
mechanism for referring patients from sites where they receive 
counseling and testing to sites where they can receive treatment needs 
to be improved. In addition, U.S. officials in three other countries 
stressed the need to link PMTCT and ARV treatment programs to other 
health services required by patients and their families, such as 
nutrition and family planning.

Poor linkages between donor-supported HIV/AIDS programs and basic 
health systems may also impair the ability of these systems to continue 
ARV treatment once donor support is discontinued. According to an 
expert directing two HIV/AIDS projects in four African countries, 
unless ARV treatment is linked to investments in sustainable health 
systems, HIV/AIDS programs can draw resources away from, and thus harm, 
the overall health sector in recipient countries. For example, U.S. 
officials in one African country stated that PEPFAR activities could 
decrease the number of staff, quality of facilities, and availability 
of drugs for basic health services that are not specifically focused on 
combating HIV/AIDS.

Physical Infrastructure, Including Health Care Facilities, Is 
Insufficient: 

According to our interviews and the documents we reviewed, deteriorated 
physical infrastructure also constitutes a challenge to expanding ARV 
treatment programs. Many of the hospitals, clinics, and laboratories in 
the PEPFAR focus countries--some of which have experienced years of 
civil strife--are ill equipped to handle expansion of ARV treatment. 
For example, U.S. officials working in one country said that inadequate 
health care facilities, including lack of laboratories, hamper the 
monitoring of ARV treatment. According to a U.S. government 
communication from Ethiopia dated September 18, 2003, facilities must 
be refurbished and equipment installed, among other needs, to support 
the implementation of ARV treatment. A November 4, 2003 summary of a 
joint U.S. agency discussion in Kenya stated that most health 
facilities targeted for involvement in treatment activities have 
physical infrastructure needs that should be addressed, including needs 
for testing and counseling space, electricity, clean water, air 
conditioning in pharmacy storerooms to maintain drug quality, and 
improved laboratory space. Further, the USAID-HHS/CDC Fiscal Year 2004 
PMTCT Initiative Implementation Plan for Uganda stated that there is 
inadequate space for program staff and equipment at the ministry of 
health and for HIV counseling and testing in prenatal clinics.

Multilateral and nongovernmental organizations have also identified 
weak health care infrastructure as an impediment to expanding ARV 
treatment. For example, when WHO ranked the overall health system 
performance of its 191 member states in 2000, it ranked all 14 of the 
PEPFAR focus countries in the bottom third.[Footnote 33] In many of 
these countries, up to one-half of the population lacks access to basic 
health care and many health facilities lack basic commodities, such as 
syringes, as well as laboratories and safe drug storage facilities. In 
addition, limited infrastructure, including roads, a clean water 
supply, and electricity, presents barriers to expanding ARV treatment. 
For example, field staff from one country said that deteriorated roads 
and other basic physical infrastructure pose a major challenge to 
delivering clinical and diagnostic services.

Coordinator's Office Has Taken Steps to Address Challenges, but 
Continued Effort Is Needed: 

The Office of the U.S. Global AIDS Coordinator has acknowledged each of 
the five challenges to expanding ARV treatment programs and has taken 
certain steps to address them, but some of these challenges require 
additional effort, longer-term solutions, and the support of others 
involved in providing ARV treatment. First, the Coordinator's Office 
has devised means to improve coordination among U.S. agencies and with 
host governments and other organizations; however, it is too soon to 
tell whether they will be effective and the PEPFAR strategy does not 
state whether the means will be monitored. Second, U.S. agencies are 
exploring ways to address some U.S. government constraints, but the 
Coordinator's Office guidance on ARV procurement leaves key problems 
unresolved. Third, the Coordinator's Office proposed short-term 
assistance to address health worker shortages, including the use of 
paid workers and volunteers from the United States and other countries, 
and the PEPFAR strategy proposes several longer-term interventions. 
However, U.S. officials said that using international volunteers for 
the short-term activities is not cost effective. Fourth, although the 
Coordinator's Office has called for stronger commitment by host 
governments, it has not addressed other, systemic constraints outside 
its direct authority. Finally, the Coordinator's Office is taking steps 
to strengthen systems for monitoring and evaluating progress toward 
PEPFAR treatment goals and is seeking to involve the private sector in 
improving the management and supply of drugs. However, some field staff 
had differing views on implementing a "network model" proposed in the 
strategy for improving basic health care infrastructure and 
facilitating treatment referrals. In addition, the Coordinator's Office 
has not addressed physical impediments such as lack of space for 
counseling and testing.

Coordinator's Office Attempting to Enhance Coordination, but Too Early 
to Judge Effectiveness: 

The Office of the U.S. Global AIDS Coordinator has acknowledged the 
importance of coordinating with national governments and other groups 
and has created mechanisms, such as HIV/AIDS teams led by the 
ambassador in each country, to enhance U.S. government coordination in 
the field and with the host government. However, it is too soon to tell 
whether these mechanisms will resolve the coordination challenges 
identified by field staff, and the PEPFAR strategy does not state 
whether the mechanisms will be monitored.

Recognizing that providing ARV treatment requires a sustained, 
collaborative effort from international, national, and local 
organizations, the PEPFAR strategy outlined an approach to leverage the 
strengths of each entity while building local capacity. According to 
the strategy, the Coordinator is expected to maximize U.S. technical 
assistance, training, and research experience when expanding treatment 
programs, while working with other stakeholders to leverage strengths 
and fill program gaps. In tandem with the host governments in the 14 
PEPFAR focus countries, the Coordinator is also expected to encourage 
the development of a single in-country structure to facilitate 
coordination among donors, the host government, NGOs, and other 
stakeholders.[Footnote 34]

The increased coordination may also facilitate efforts to harmonize 
proposal, reporting, surveillance, management, and evaluation 
procedures to ensure that programs are comparable and complimentary and 
to decrease the burden on host organizations and governments. The 
strategy specifies that the Coordinator's Office will work with 
technically expert partners, such as WHO, to determine the best 
treatment options and ensure that there are sound management strategies 
in place to support them. Finally, the Coordinator will encourage 
stakeholders to work through local partners and promote programs that 
support the countries' national strategies.

In addition, the Coordinator has worked to establish relationships with 
international counterparts, meeting with the leadership of WHO, UNAIDS, 
the World Bank, and the Global Fund. The Coordinator, together with the 
HHS Secretary, also led a delegation of representatives from the 
administration, the Congress, WHO, UNAIDS, the Global Fund, and 
numerous private entities and NGOs to meet with leaders and view ARV 
treatment and other HIV/AIDS-related programs in four African nations 
in December 2003.

To ensure that U.S. efforts in the field are coordinated, and to 
enhance relationships with the host government, the Coordinator has 
directed that an HIV/AIDS team, led by the Ambassador, be set up in 
each country. These teams may also have an official designated by the 
Ambassador to serve as the day-to-day liaison. The teams are generally 
comprised of representatives of each of the agencies working on HIV/
AIDS-related projects in a given country. According to the field staff 
we interviewed, these teams have already been set up in most countries, 
and some countries had already established HIV/AIDS teams that will now 
focus on PEPFAR. Also, to improve coordination between headquarters and 
the field, the Coordinator's Office sought input from field staff by 
requesting written documents and by conducting an intensive series of 
meetings with field staff over a 2-week period in November 2003. 
However, it is too soon to tell whether these mechanisms will be 
effective in resolving the coordination challenges field staff 
identified.

Agencies Exploring Solutions to Some U.S. Government Constraints, but 
ARV Procurement Problems Remain: 

The Office of the U.S. Global AIDS Coordinator, together with the 
agencies implementing PEPFAR, is exploring options for addressing U.S. 
government constraints involving (1) contracting capacity in the field; 
(2) differing laws and regulations governing funds appropriated to 
implementing agencies, in particular, USAID and HHS/CDC, with respect 
to procurement and foreign taxation of goods purchased with U.S. 
assistance; and (3) differing agency requirements for auditing non-U.S. 
grantees. In addition, the Coordinator's Office has provided guidance 
to the field on ARV procurement. However, this guidance leaves key 
issues unresolved.

PEPFAR Agencies Exploring Options to Enhance Contracting Capacity and 
Address Differing Agency Laws, Regulations, and Requirements: 

The Coordinator's Office and PEPFAR agencies are exploring ways to 
enhance contracting capacity in the field and to address differing 
laws, regulations, and audit requirements that may affect their joint 
efforts to expand ARV treatment programs. While no specific options 
have been proposed to date, the Coordinator's Office has directed USAID 
to develop a request for proposals to design and implement a mechanism 
for procuring, distributing, and managing the supply of drugs and other 
items. All PEPFAR agencies and possibly other, non-U.S., stakeholders 
would use this mechanism as well. As a joint mechanism, it may address 
some of the contracting capacity needs raised by field staff, as well 
as the differing agency regulations pertaining to procurement. 
Guidelines on procurement released by the Coordinator's Office on March 
24, 2004, note that U.S. agencies involved in PEPFAR have different 
limitations on their ability to procure goods and services from outside 
the United States and that the office is reviewing options for 
addressing this issue. The guidelines state that the office will 
provide additional guidance in the future, although no specific time 
frame is given.

Regarding foreign taxation of goods bought with U.S. assistance, the 
PEPFAR strategy states that tariffs and duties on pharmaceuticals are 
"barriers" that can increase the cost of drugs in developing countries 
and "work at cross purposes" with initiatives to improve access to 
medicines. According to officials from the Coordinator's Office, legal 
experts from the State Department and other PEPFAR agencies are 
discussing how to address differing agency appropriations laws 
regarding this issue. In addition, audit officials from USAID and HHS 
are discussing how to address differing agency requirements for 
auditing non-U.S. grantees.

Global AIDS Coordinator Provided Guidance to Field on ARV Procurement, 
but Problems Remain: 

The Coordinator's Office provided guidance to U.S. field staff on ARV 
procurement, but this guidance did not resolve the following issues 
regarding the use of PEPFAR funds to purchase these drugs: (1) The 
policy of the Coordinator's Office on procuring ARVs may change in the 
future. (2) The Coordinator's Office does not define how PEPFAR 
activities and funding can support host country treatment sites that do 
use generics. (3) In at least one country, the office's current ARV 
procurement policy conflicts with PEPFAR's stated principle of 
providing assistance in a manner consistent with host country plans and 
policies.

Coordinator's Office Provided Guidance on ARV Procurement: 

The Coordinator's Office issued guidance to field staff on ARV 
procurement over a 5-month period (November 2003-March 2004) in an ad 
hoc, question-and-answer format in response to inquiries from the field 
(see table 1). This guidance was issued before, during, and after our 
structured interviews. According to officials from the Coordinator's 
Office, they also addressed questions from field staff during 2 weeks 
of intensive meetings in Washington, D.C., in November 2003 and during 
visits to the PEPFAR focus countries over the next several months. 
However, the Coordinator's Office provided the most detailed guidance 
more than 2 months after a January 19, 2004, deadline for obligating 
initial funds and just one week before field staff in each country were 
required to submit their operational plans for fiscal year 2004.

As noted previously, the Coordinator's current policy is to fund only 
the purchase of drugs that have been approved by entities it defines as 
stringent regulatory authorities, citing concerns about safety and 
efficacy. The Coordinator's Office convened a meeting with 
international regulators in March 2004 to develop principles for 
evaluating the safety and efficacy of FDCs.[Footnote 35] In addition, 
it has directed HHS/CDC to develop a request for proposals to assure 
the quality of drugs and other products procured with PEPFAR funds. On 
May 16, 2004, the HHS Secretary announced an expedited process for 
reviewing data submitted to the HHS/FDA on the safety, efficacy, and 
quality of generic and other ARV drugs, including FDCs, intended for 
use under PEPFAR. Drugs approved under this process can then be 
purchased with PEPFAR funds provided that international patent 
agreements and local government policies allow their purchase, 
according to the Coordinator's Office, HHS, and USAID.[Footnote 36]

Table 1: Guidance Issued by the Office of the U.S. Global AIDS 
Coordinator to Field Staff on ARV Procurement and PEPFAR Deadlines: 

Date: November 25, 2003; 
Event: Guidance for completing track 2 plans; 
Details: 
* Stated that "Each mission must adhere to U.S. government policy in 
procuring ARV drugs and other medicines."; 
* Stated that "Separate guidance is available on current U.S. 
government policy."; 
* Did not state what U.S. government policy is or where separate 
guidance on current policy could be found; 
* Did not note that (as discussed earlier in this report) the agencies 
implementing PEPFAR have different standards for procuring items to be 
used abroad.

Date: December 16, 2003; 
Event: Responses to questions on ARV procurement and other issues; 
Details: 
* Stated "no" in response to a question asking if a proposed 
procurement mechanism under PEFAR would allow for the purchase of 
generics; 
* Stated that "specific guidance will be provided separately" in 
response to a question asking if there is a definitive PEPFAR policy on 
the procurement of generic drugs; 
* Stated that a WHO prequalification process for drugs does not 
constitute approval by a stringent regulatory authority.[A].

Date: January 19, 2004; 
Event: Deadline for obligating funds under tracks 1 and 1.5.

Date: January 30, 2004; 
Event: Updated guidance for completing track 2 plans; 
Details: 
* No change from November 25, 2003, guidance regarding ARV procurement.

Date: February 20, 2004; 
Event: Responses to questions on ARV procurement and other issues; 
Details: 
* Stated that certain FDCs cannot be used "until there has been a 
demonstration that these drugs are safe and effective."; 
* Stated that the U.S. government is working with international 
regulators to resolve safety and efficacy issues and that a complete 
question-and-answer sheet on ARV procurement is being prepared.

Date: February 23, 2004; 
Event: PEPFAR strategy issued; 
Details: 
* Leaves open the possibility that PEPFAR agencies could in the future 
procure certain FDCs or other generics.

Date: March 24, 2004; 
Event: Responses to questions on ARV procurement; 
Details: 
* Provided a definition of "stringent regulatory authority."; 
* Provided a statement of USAID's procurement regulations, specifying 
requirements related to source and origin, safety and efficacy, and 
patents; 
* Provided the anticipated timeframe for publishing requests for 
proposals for procurement and quality assurance (second quarter of 
2004) and awarding contracts (by the end of 2004).

Date: March 31, 2004; 
Event: Deadline for submitting track 2 plans.

Note: The Coordinator's Office emailed this guidance to all field 
staff.

[A] According to WHO, under this process, evaluators from both 
industrialized and developing countries assess a manufacturer's data on 
its product's safety, efficacy, and quality, as well as the 
manufacturing processes and facilities. Through this process, WHO has 
found some generic ARV drugs acceptable, in principle, for U.N. 
agencies to procure.

[End of table]

Guidance from Coordinator's Office Does Not Resolve All Issues: 

The ARV procurement guidance provided by the Coordinator's Office did 
not resolve all issues regarding the use of PEPFAR funds to purchase 
these drugs. While the guidance clearly stated that no PEPFAR funds 
could be used to purchase drugs that have not been approved by entities 
the office defines as stringent regulatory authorities, the PEPFAR 
strategy leaves open the possibility that funds could in the future be 
used to procure generic ARV drugs, including FDCs, provided they meet 
safety and efficacy standards agreed to by the office. Moreover, the 
strategy endorses the selection of products such as FDCs, which 
combine several active ingredients. An April 8, 2004, press release 
from HHS elaborates that combination therapies, including FDCs, are 
considered by many to be essential to treating diseases like HIV/AIDS 
as well as to limiting the development of drug resistance. The press 
release states that, among other advantages, FDCs simplify dosing, 
which could result in better patient adherence to therapy.

In addition, the ARV procurement guidance issued by the Coordinator's 
Office does not define how PEPFAR activities and funding can support 
host country treatment sites that do use generics. The March 24, 2004, 
guidance acknowledged that many countries' treatment guidelines include 
FDCs and other drugs that have not been approved by stringent 
regulatory authorities. PEPFAR funds therefore cannot be used to 
purchase these products or build logistical systems that support only 
these products but can be used to "provide other support" to treatment 
sites that use them.

Further, in at least one country, the office's current policy, which in 
effect does not allow the purchase of generics, conflicts with PEPFAR's 
stated principle of providing assistance in a manner consistent with 
host country plans and policies. An inquiry from Kenya cited by the 
Coordinator's Office in its February 20, 2004, response states that the 
country's first line treatment, at both government and faith-based or 
private sector facilities, relies on FDCs "for reasons of economics, 
pill burden, and other factors." The inquiry urgently requested 
clarification from the Coordinator's Office, stating that a decision on 
whether FDCs and other generics can be purchased will profoundly affect 
the extent to which the Kenya mission "must develop parallel rather 
than integrated systems" and the level of resources needed to reach 
treatment targets under PEPFAR. Other major donors such as the Global 
Fund--to which the United States is one of the largest contributors and 
for which the HHS Secretary currently serves as the Chairman of the 
Board--allow their funds to be used for purchasing generic ARV drugs, 
including FDCs.

Coordinator's Office Focusing on Short-and Long-term Interventions to 
Alleviate Shortage of Health Workers: 

The Coordinator's Office will focus on both short-and long-term 
interventions to address host country human resource shortages, which 
it has identified as a critical limitation to implementing its 
treatment goals. In the short term, the office will focus on rapidly 
expanding and mobilizing health care personnel through interventions 
that include the use of paid workers, international volunteers, 
training, and technical assistance to meet treatment goals under 
PEPFAR. However, in June 2003, U.S. government officials documented 
their concerns about the use of international volunteers for some of 
these activities. The PEPFAR strategy also identified longer-term 
interventions[Footnote 37] that should be considered by host 
governments and other donors, and the Coordinator's Office is 
initiating discussions with these groups to explore options for 
implementing longer-term interventions.

Coordinator's Office Proposed Several Short-term Solutions; U.S. Field 
Staff Have Raised Concerns over Use of International Volunteers: 

The Coordinator's Office will respond to immediate needs to increase 
manpower through several short-term interventions, including the use of 
international volunteer health professionals, but field staff expressed 
concern that this intervention will generate other problems. In 
addition to using volunteers, U.S. efforts will focus on training 
existing providers in case management for ARV treatment and providing 
technical assistance through arrangements that include "twinning"--
pairing health facilities in the PEPFAR focus countries with 
organizations in the United States and other countries--to provide 
training and technical assistance, according to the PEPFAR 
strategy.[Footnote 38] The Coordinator's Office will also support host 
country efforts to depend less on the scarce supply of skilled health 
workers by extending responsibility for patient treatment to nurses, 
counselors, and health volunteers, as well as exploring options to 
involve traditional healers, birth attendants, and family members in 
treatment and care. The Coordinator characterized the human resource 
shortage as the second most important issue after political leadership 
in addressing HIV/AIDS. Accordingly, Coordinator's Office officials 
stated that all contracts and contract renewals include language on 
developing local human resource capacity.

However, USAID and HHS/CDC field officials informed the Coordinator's 
Office of potential problems associated with using international 
volunteers to address health worker shortages and training. 
Specifically, the use of such volunteers for short overseas tours 
creates heavy administrative burdens, may not be sustainable over the 
long term, and is not cost effective, according to a June 2003 
communication summarizing lessons learned from the PMTCT Initiative. 
The communication recommended that tours be for a minimum of one year. 
In addition, regarding twinning, a USAID official in one country stated 
that the ministry of health raised concerns over the time involved in 
training international volunteers and that twinning will not address 
issues such as attracting and enrolling nurses who will stay in the 
country, particularly in rural areas. Despite its attention to training 
and technical assistance, the strategy does not discuss the extent to 
which the Coordinator's Office will collaborate with other donors on 
training to minimize duplicative sessions and workplace disruptions 
when staff attend training.

PEPFAR Strategy Identifies Longer-term Interventions: 

The PEPFAR strategy outlines longer-term interventions to stem the 
critical human resource shortage in the 14 countries, emphasizing 
actions that host governments can take on their own or in discussion 
with other donors. These include increasing the quality and number of 
graduates from medical and related professional schools, improving 
retention of the health sector workforce through salary increases and 
other incentives, and establishing bilateral and international 
agreements to resolve salary differentials. The June 2003 communication 
emphasized the need for guidance on the extent to which U.S. agencies 
will supplement the salaries of government health-care workers in 
PEPFAR focus countries in order to retain qualified employees and 
implement activities under PEPFAR.

According to an official in the Coordinator's Office, the office is 
developing a policy statement on the use of PEPFAR resources for 
salaries. This official stated that the Coordinator's Office plans to 
work with other donors, including the World Bank, to support long-term 
interventions such as supplementing salaries and building and 
strengthening professional schools. The Coordinator's Office is engaged 
in frequent meetings with the 3-by-5 team at WHO and has met with 
officials at the World Bank and UNAIDS to discuss a coordinated 
approach to human capacity development. An interagency group formed 
under the PMTCT Initiative is also contributing to these efforts. 
According to an expert at the World Bank, donors should help finance 
host countries' efforts to address human resource issues. Because 
PEPFAR will play a central role in its focus countries, a WHO official 
stated that other donors will look to the United States to address 
long-term interventions to issues faced by host country governments. An 
October 2003 document from U.S. field staff in one African country also 
raised the importance of U.S. government support for salaries for 
government workers in the national health system, adding that the 
national government cannot afford to pay for significant numbers of new 
staff.

Coordinator's Office Focuses on Enhancing Leadership and Political 
Commitment: 

The Coordinator's Office called on U.S. officials, including 
ambassadors, to advocate for bold leadership to fight HIV/AIDS and 
identified mechanisms for fostering political commitment and reaching 
out to all groups involved in combating the disease in recipient 
countries. The Coordinator's Office has not begun to work with other 
stakeholders to address other, more systemic host government 
constraints that U.S. field staff identified.

Recognizing that containment of HIV/AIDS requires bold leadership and 
political commitment, the PEPFAR strategy calls for high-level 
officials in Washington and American ambassadors abroad to encourage 
commitment from heads of state and other government leaders. The 
strategy emphasizes that American embassy staff must be informed and 
engaged on the issue of HIV/AIDS in their host countries and asks them 
to raise the issue in host government forums. On November 26, 2003, the 
Global AIDS Coordinator sent a communication to embassies in the PEPFAR 
focus countries that summarized points for building support at the 
country level. For example, the communication requested that all chiefs 
of mission brief host government leaders on PEPFAR in order to build 
their support for the program and establish a process whereby U.S. 
field staff, along with host government officials and other 
stakeholders, can rapidly begin to design and implement PEPFAR. 
However, these efforts were hindered by the fast pace of PEPFAR, which, 
as previously discussed, made it difficult for field staff to consult 
with host governments.

The PEPFAR strategy looks to a broad range of community leaders and 
private institutions to generate leadership and fight the stigma 
associated with HIV/AIDS.[Footnote 39] It calls for using public-
private partnerships at local, national, regional, and international 
levels to strengthen global and in-country responses to HIV/AIDS. For 
example, the strategy states that the United States will engage 
community leaders such as mayors, tribal authorities, elders, and 
traditional healers to promote correct and consistent information about 
the epidemic and to combat stigma and harmful cultural practices. In 
addition, it commits to working with faith-based leaders and joint 
national and international business and labor coalitions to facilitate 
efforts to improve and expand programs in the workplace and take 
advantage of marketing, communications, and logistical skills to 
improve the reach and effectiveness of AIDS programs. The strategy also 
calls on U.S. officials to advocate for a greater global response 
through multilateral forums such as UNAIDS, international conferences, 
and participation in the Global Fund.

Neither the PEPFAR strategy nor the Coordinator's Office addresses 
other host government constraints raised by our interview respondents, 
including the poor delineation of roles between government bodies 
responsible for combating HIV/AIDS and slow decision-making processes, 
that are outside the Coordinator's control and will take additional 
time to resolve.

Coordinator's Office Aims to Strengthen Infrastructure for Information 
and Drug Supply; Some Field Staff Had Differing Views on Implementing 
Proposed Health Care Model: 

The Coordinator's Office has taken several steps to improve the 
infrastructure needed to support expansion of ARV treatment; however, 
some field staff expressed differing views on implementing a proposed 
tiered system of health care. In response to the PEPFAR strategy's 
emphasis on results-driven interventions, the Coordinator's Office is 
working to strengthen systems to monitor and evaluate progress toward 
treatment goals. In addition, the Coordinator's Office seeks to improve 
countries' abilities to manage the drug supply in the short run by, 
among other things, calling on the private sector to help with 
distribution. The new procurement mechanism (see p. 34) is also meant 
to address these issues. Consistent with the U.S. Leadership Act 
authorizing PEPFAR, the strategy proposes the use of a "network model" 
of health care facilities to provide a high volume and level of 
services in central medical centers and more basic services in outlying 
areas to enhance access to ARV treatment. However, some field staff 
expressed differing views on this model. Neither the strategy nor the 
Coordinator's Office addresses certain physical infrastructure 
impediments raised in documents submitted to the Coordinator or by our 
interview respondents.

Coordinator's Office Attempting to Improve Data Collection and 
Reporting: 

To support the effective gathering and reporting of information to 
monitor and evaluate progress toward PEPFAR goals, the Coordinator's 
Office will support training to improve and expand recipient countries' 
surveillance and laboratory capacity. The office will provide 
assistance to countries for improved information gathering and 
reporting to measure progress in reaching program goals. These 
indicators measure the numbers of facilities supported, practicing 
professionals and community workers trained, and clients reached. The 
Coordinator's Office worked with officials from HHS, the U.S. Census 
Bureau, USAID, other U.S. agencies, UNAIDS, WHO, and the Global Fund, 
to assess new data needs and minimize duplicative data collection. The 
Coordinator's Office developed HIV/AIDS-specific coding categories to 
gather information for a number of activities, including (1) preventing 
HIV transmission from mothers to babies, (2) other HIV prevention 
activities, (3) treatment, (4) care, and (5) assessing laboratory 
infrastructure needs. For example, to gather information for ARV 
treatment, the Coordinator's Office developed a facility checklist to 
assess delivery of treatment, including eligibility criteria for 
patients, clinical monitoring and lab tests offered, standard operating 
procedures and protocols, and record keeping.

The Coordinator's Office is working with the Global Fund and other 
organizations to synchronize systems for monitoring and evaluating HIV/
AIDS programs. According to the office, U.S. officials have met with 
officials from UNAIDS, the World Bank, the Global Fund, and WHO to 
discuss developing common indicators and guidelines for paper-based or 
electronic tracking. To assist U.S. field staff in planning and 
monitoring treatment programs and report on PEPFAR progress, the office 
has established the following indicators for monitoring and evaluating 
ARV treatment: the number of facilities, programs, or both, including a 
separate breakout of the number of faith-based facilities or programs; 
the number of clients served; the number of new clients served; the 
number of clients continuously receiving treatment and related services 
for more than 12 months; and the number of people trained. To measure 
progress toward the overall PEPFAR goal of providing ARV treatment to 2 
million people by the end of 2008, field staff in each of the focus 
countries will report semiannually to the Coordinator's Office on the 
number of people receiving ARV drugs through PEPFAR.

According to the Coordinator's Office, data will be collected and 
stored in an electronic repository that is expected to be operational 
in September 2004. Twice a year, U.S. field staff will electronically 
transmit data measuring the progress of PEPFAR activities to the 
Coordinator's Office. According to the office officials, the office 
will put the information in a database that field staff and 
multilateral organization can access.

Because fully equipped laboratories are necessary for monitoring ARV 
treatment to limit the development of resistant strains of the virus, 
the Coordinator's Office will fund assessments of existing laboratory 
infrastructure and will fund upgrades of laboratories, as needed. In 
addition, the Coordinator's Office will support the development, 
adaptation, and translation of training materials for specimen 
collection, storage, shipment, testing, and record keeping.

PEPFAR Strategy Has Identified Short-term Actions for Managing the Drug 
Supply: 

The PEPFAR strategy recognizes that the sharp increase in the volume of 
products to be provided under the program and from other sources such 
as the Global Fund may challenge existing national supply systems. 
Accordingly, as noted on p. 34, the Coordinator's Office is developing 
a request for proposals to design and implement a joint procurement 
mechanism to better manage the supply of drugs and other products. The 
strategy calls for training personnel in health logistics systems and 
supporting efforts to minimize drug diversion, counterfeiting and 
waste. It also states that the United States will collaborate with 
other donors to minimize distribution gaps. To accomplish its 
objectives in the short run, the Coordinator's Office will call on the 
private sector to perform some logistics functions, such as building up 
distribution and information management systems and improving storage 
conditions. For example, PEPFAR agencies will provide technical 
assistance and fund training to strengthen procurement and distribution 
systems. By increasing the number of people trained in procurement and 
distribution, PEPFAR seeks to improve local capacity to negotiate, 
purchase, manage, and supply goods. However, the implementation of this 
objective may face the same human resource constraints noted 
previously, due to the limited number of available workers.

PEPFAR Proposes "Network Model" to Address Basic Health Infrastructure; 
Some Field Staff Had Differing Views on Implementing this Model: 

Consistent with the U.S. Leadership Act authorizing PEPFAR, the PEPFAR 
strategy proposes a tiered model for providing treatment; however, some 
field staff expressed differing views on implementing this model. 
According to the strategy, this "network model" integrates prevention, 
treatment, and care activities through a layered system of central 
facilities that support satellite centers and mobile units to reach the 
most rural areas. It comprises central medical facilities, regional and 
district-level facilities, and community clinics.

A September 18, 2003 communication to the Coordinator from U.S. field 
staff in Ethiopia stated that the model is appropriate in that country, 
and that current HHS/CDC and USAID planning for PEPFAR in Ethiopia uses 
the model. In addition, an October 28, 2003 communication from 
Mozambique stated that the country has developed an integrated health 
network with levels of supervision and referral that correspond to the 
model. However, field staff in Uganda, the country often cited by U.S. 
government headquarters officials as having a successful model, stated 
in a written communication to the Coordinator dated October 8, 2003, 
that the model is not fully operational in Uganda owing to the same 
host country constraints that many resource-poor countries face. 
According to the communication, weak or nonexistent infrastructure, 
limited human and financial resources, and poor training constrain the 
model at all levels.

Certain Physical Impediments Are Not Addressed: 

Although the PEPFAR strategy acknowledges that many of the affected 
countries lack the necessary health infrastructure needed for effective 
HIV/AIDS treatment, it does not address certain physical impediments 
raised by U.S. government field staff, such as inadequate space for HIV 
counseling and testing in prenatal clinics and other medical 
facilities. While the strategy recognizes that lack of basic amenities 
such as clean water is a barrier to successful treatment, it does not 
discuss how to address this issue. In addition, it does not discuss the 
impact of deteriorating roads, which affect the delivery of drugs and 
other commodities. Clean water, passable roads, and other basic 
infrastructure are outside the direct authority of the Coordinator's 
Office.

Conclusions: 

The Office of the U.S. Global AIDS Coordinator faces five key 
challenges as it leads U.S. efforts to significantly expand ARV 
treatment in the 14 PEPFAR focus countries. Certain key challenges, 
such as the shortage of trained health workers, limited commitment of 
some host governments, and weak infrastructure require long-term 
solutions and the support of host governments, donors, and other 
organizations providing ARV treatment. Other challenges are within the 
control of the U.S. government, and the Coordinator's Office has begun 
to (1) take steps to facilitate host government participation in 
planning PEPFAR activities and (2) explore ways to enhance U.S. 
contracting capacity in the field and address differing laws, 
regulations, and requirements applicable to the agencies implementing 
PEPFAR. In addition, HHS, with the support of the Coordinator's Office, 
recently announced an expedited review process for generic and other 
ARV drugs, including FDCs, which could be procured with PEPFAR funds. 
However, the Coordinator's Office has not specified the activities that 
PEPFAR can fund and support in national treatment programs that use ARV 
drugs not approved for purchase by the office. Given the importance of 
these challenges to expanding ARV treatment, it is critical that the 
Coordinator's Office ensure that the issues reach full and timely 
resolution.

Recommendations for Executive Action: 

To improve the U.S. Global AIDS Coordinator's ability to address 
challenges in expanding AIDS treatment in PEPFAR focus countries, we 
recommend that the Secretary of State direct the Coordinator to: 

* monitor implementing agencies' efforts to coordinate PEPFAR 
activities with stakeholders involved in ARV treatment, including 
taking adequate steps to actively solicit the input of host government 
officials and respond to their input;

* collaborate with the Administrator of USAID and the Secretary of HHS 
to address contracting capacity constraints in the field and resolve 
any negative effects resulting from the differing laws governing the 
funds appropriated to these agencies in the areas of procurement and 
foreign taxation of U.S. assistance, as well as differing requirements 
for auditing non-U.S. grantees;

* specify the activities that PEPFAR can fund and support in national 
treatment programs that use ARV drugs not approved for purchase by the 
Coordinator's Office; and: 

* work with national governments and international partners to address 
the underlying economic and policy factors creating the crisis in human 
resources for health care.

Agency Comments and Our Evaluation: 

The State Department, HHS, and USAID provided combined written comments 
on a draft of this report (see app. VIII for a reprint of their 
comments). The agencies concurred with the report's overall conclusion 
that while they have addressed a number of key challenges in providing 
services, other challenges remain for the medium and long term. The 
agencies did not specifically comment on GAO's recommendations; 
however, they noted that program efforts and activities have progressed 
beyond what the report describes, and work is underway to address the 
majority of challenges and issues raised. Some of these efforts reflect 
our recommendations. The agencies also provided technical comments that 
we have incorporated as appropriate. Our draft report contained the 
first 3 recommendations. We added the fourth recommendation in light of 
additional information State, HHS, and USAID provided when they 
commented on a draft of this report. This information reemphasized the 
need for these agencies to engage in efforts to address the critical 
shortage of health workers in recipient countries.

We are sending copies of this report to the U.S. Global AIDS 
Coordinator, the Secretary of HHS, the Administrator of USAID, and 
interested congressional committees. Copies of this report will also be 
made available to other interested parties on request. In addition, 
this report will be made available at no charge on the GAO web site at 
[Hyperlink, http://www.gao.gov].

If you or your staff have any questions about this report, please 
contact me at (202) 512-3149. Other GAO contacts and staff 
acknowledgments are listed in appendix IX.

Sincerely yours,

Signed by: 

David Gootnick, 
Director, International Affairs and Trade: 

[End of section]

Appendixes: 

Appendix I: Objectives, Scope, and Methodology: 

The Chairman of the Subcommittee on Foreign Operations, Export 
Financing, and Related Programs of the House Committee on 
Appropriations asked us to (1) identify major challenges to U.S. 
efforts to expand antiretroviral (ARV) treatment in resource-poor 
settings and (2) assess the U.S. Global AIDS Coordinator's response to 
these challenges. Our work focused on the 14 countries targeted under 
the President's Emergency Plan for AIDS Relief (PEPFAR): Botswana, Cte 
d'Ivoire, Ethiopia, Guyana, Haiti, Kenya, Mozambique, Namibia, Nigeria, 
Rwanda, South Africa, Tanzania, Uganda, and Zambia.[Footnote 40]

Methodology for Identifying Challenges to Expanding ARV Treatment: 

To identify challenges to U.S. efforts to expand ARV treatment, we 
conducted 28 structured telephone interviews in December 2003 and 
January 2004 with key staff from the U.S. Agency for International 
Development (USAID) and the Department of Health and Human Services' 
Centers for Disease Control and Prevention (HHS/CDC) responsible for 
implementing HIV/AIDS programs in the 14 targeted countries.[Footnote 
41] To ensure balance, we conducted one USAID and one HHS/CDC interview 
in each country. We coded the responses to our open-ended interview 
questions using a set of internally developed analytical categories.

Our structured interview document contained 16 questions on the 
implementation and expansion of HIV/AIDS treatment programs, including 
program activities and coordination and management challenges (see app. 
II). To develop the questions and further assess challenges, we 
reviewed numerous documents analyzing treatment programs from U.S. 
government agencies, U.N. organizations, and nongovernmental 
organizations (NGO), including reports by medical experts and 
practitioners. We also interviewed U.S.-based officials from USAID and 
HHS; representatives from multilateral organizations, including the 
World Health Organization (WHO), the United Nations Joint Program on 
HIV/AIDS (UNAIDS), the World Bank, and the Global Fund to Fight AIDS, 
TB, and Malaria (Global Fund); and medical experts experienced in 
treating people with HIV/AIDS in resource-poor settings. We traveled to 
Geneva, Switzerland, to meet with WHO, Global Fund, and UNAIDS 
representatives, and to Paris, France, to meet with program experts 
from Mdecins sans Frontires (Doctors Without Borders), an NGO 
providing ARV and other AIDS treatment in resource-poor countries. Most 
of the structured interview questions were open ended; two were closed 
ended (see app. II for a list of the questions). Experts reviewed 
initial versions of our open-and close-ended questions and four of our 
initial respondents pretested the questions. We refined our questions 
based on their input.

To summarize the open-ended responses, we systematically coded a set of 
key questions[Footnote 42] on challenges to coordination and program 
expansion from our structured interviews. We grouped the responses into 
five major challenge categories. As in any exercise of this type, the 
categories developed can vary when produced by different analysts. To 
address this, two GAO analysts reviewed the responses to the key 
questions from five interviews and independently proposed categories, 
separately identifying major challenges and then agreeing on a common 
set of challenges. They independently analyzed and differentiated 
responses into subcategories within each major challenge area and then 
agreed on a common set of subcategories. We refined these subcategories 
during the coding exercise that followed. Interview responses falling 
into a specific subcategory often derived from a variety of questions 
in our analysis; there was not a one-to-one correspondence between 
questions and categories.

We then analyzed applicable statements from each of the 28 interviews 
and placed them into one or more of the resulting subcategories. Four 
GAO analysts each examined 7 of the 28 interviews. One analyst made 
some adjustments in placements to ensure consistency in coding and then 
compiled the resulting placements into a single master document. The 
analyst then summarized and tallied the number of respondents providing 
information in each subcategory.[Footnote 43] Two GAO analysts then 
independently reviewed the interview analysis document. All 
disagreements regarding the placement of responses into subcategories 
were discussed and reconciled. Figure 4 presents the numbers of 
respondents citing challenges in each of the five major categories, and 
figures 8 through 12 present the breakout of each major challenge into 
subcategories. These figures show subcategories containing information 
from 3 or more respondents; we also cite in footnotes other information 
provided by only 1 or 2 respondents.

We explicitly prompted respondents with questions on coordination 
issues. We identified the other four major challenges during our 
analysis of the responses to the coded questions. As a result, the 
number of respondents providing information on coordination challenges 
is higher than the number providing information on the other four 
challenges.

We conducted a separate analysis of the two closed-ended questions, 
which asked respondents to rank the degree of difficulty coordinating 
with various groups (question 12.b), and coordinating with all parties 
on specific activities (question 13.b). (See app. VII.) 

Finally, to expand on the structured interviews, we reviewed relevant 
U.S. laws, regulations, and policies governing procurement, 
contracting, taxation, and auditing; documents that field 
representatives prepared for the Coordinator's Office; and documents 
from multilateral organizations and NGOs. We also interviewed U.S.-
based officials from the Coordinator's Office, USAID, and HHS.

Methodology for Assessing the U.S. Response: 

To assess the Global AIDS Coordinator's response to these challenges, 
we reviewed The President's Emergency Plan for AIDS Relief: U.S. Five 
Year Global HIV/AIDS Strategy (February 2004);[Footnote 44] 
administration guidance, including several communications to the field 
on ARV procurement; and information on the emerging structure and 
initial activities of the Coordinator's Office. We also interviewed 
officials from the Coordinator's Office, USAID, and HHS.

We conducted our work from July 2003 through May 2004, in accordance 
with generally accepted government auditing standards.

[End of section]

Appendix II: Structured Interview Questions: 

COUNTRY: 

Respondent's(s'): 
* name(s):  
* titles(s): 
* email(s): 
* phone number(s): 

Respondent's(s) agency: 

Date of interview: 

Name(s) of interviewer(s): 

Introduction: 

The following questions are to assist the U.S. General Accounting 
Office to gather information on how USAID missions and HHS/CDC field 
offices coordinate the implementation and scale up of ARV treatment 
programs in the field. Specifically, we are looking to understand how 
your agency coordinates with other U.S. government agencies and other 
key stakeholders (multilateral, other bilateral, host government, 
nongovernmental) to identify the challenges to these coordination 
efforts, and to obtain lessons learned that can inform the President's 
Emergency Plan for AIDS Relief. 

Background: 

For questions 2-5, please refer to appropriate documents. Where asked, 
please indicate the name of the document(s) you used to answer these 
questions.

1; We are interested in the PMTCT, PMTCT Plus, and other ARV programs. 
Which of these programs does your mission/field office support? 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 

2.a; Approximately how many people are currently receiving these 
services in your country? 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 
PMTCT (total, to date): 

2.b; Please indicate whether the numbers in the PMTCT Plus column are 
included in the ARV treatment column: 
ARV treatment: 
PMTCT Plus: Yes? No? 
PMTCT (over last 12 months): 
PMTCT (total, to date): 

2.c; Please provide the name of the document(s) you used to obtain the 
data for each of these services: 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 
PMTCT (total, to date): 

2.d; Please indicate if the available data are inadequate to answer 
the question for any of these services: 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 
PMTCT (total, to date): 

3.a; Of the number in 2.a., how many are being supported by U.S. 
government programs? 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 
PMTCT (total, to date): 

3.b; Please provide the name of the document(s) you used to obtain the 
data for each of these services: 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 
PMTCT (total, to date): 

3.c; Please indicate if the available data are inadequate to answer 
the question for any of these services: 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 
PMTCT (total, to date): 

4.a; Over the next 6-12 months, how many people in your country do you 
realistically expect to start treatment? 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 

4.b; Please provide the name of the document(s) you used to obtain the 
data for each of these services: 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 

4.c; Please indicate if the available data are inadequate to answer the 
question for any of these services: 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 

5.a; Of the number in 4.a., how many will be supported by U.S. 
government programs? 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 

5.b; Please provide the name of the document(s) you used to obtain the 
data for each of these services: 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 

5.c; Please indicate if the available data are inadequate to answer 
the question for any of these services: 
ARV treatment: 
PMTCT Plus: 
PMTCT (over last 12 months): 

6.a. Please look at the list of program activities related to PMTCT, 
PMTCT Plus, and ARV treatment that we sent to you. In which of these 
program activities is your mission/field office involved? Indicate 
which of these activities are directly funded by your mission/field 
office.

Voluntary counseling and testing.

Rapid testing.

Targeting of at-risk groups.

Safe motherhood programs.

Mother/child health programs.

Family planning assistance.

Education programs.

Community outreach.

Short course zidovudine (AZT).

Single dose nevirapine.

Continuous ARV treatment.

Treatment for partners.

Treatment of opportunistic infections.

TB diagnosis and treatment.

Diagnosis and treatment of STIs.

Lab support.

Palliative care.

Surveillance.

Monitoring and evaluation.

Training (of doctors, nurses, healthcare workers and administrators).

Other (please describe).

6.b. I'm going to read out a list of items and services related to ARV 
treatment. Does your mission/field office procure any of them?

hiring/contracting of services.

ARV drugs.

other drugs (for opportunistic infections).

diagnostics (e.g., test kits, including rapid test kits).

lab equipment and commodities (e.g., reagents).

vehicles.

computers or other office equipment.

other (please specify) .

6.c. What types of program activities (listed in 6.a.) and procurement 
activities (just discussed) is your mission/field office best suited to 
perform?

6.d. With which of these activities do you face the greatest challenges 
to implementation?

6.e. What do you see as a feasible solution to these challenges?

7. How do you program resources according to congressional earmarks? 
Given the earmarks in the authorizing legislation for the President's 
Emergency Plan for AIDS Relief (55% for treatment, of which 75% is to 
be spent on ARV drugs), do you have to make major changes in your 
programs to accommodate these earmarks?

Coordinating with other USG agencies: 

8.a. Has a point of contact for the President's Emergency Plan for 
AIDS Relief been designated in your country? If so, is this contact at 
the U.S. Embassy? If not, at which agency?

8.b. What other U.S. government agencies does your mission/field office 
work or coordinate with on VCT, PMTCT, PMTCT Plus, and/or other ARV 
treatment programs? Please identify the program activities that these 
agencies perform.

8.c. How does your mission/field office currently coordinate with 
these agencies? (Please tell us about all formal and informal 
coordination mechanisms, such as regular meetings, procedures for 
information sharing, MOUs, TORs, informal contacts, etc.) 

8.d. Are there any plans to change the method of coordination?

9. Please describe the key challenges your mission/field office has 
faced coordinating with other U.S. agencies on VCT, PMTCT, PMTCT Plus, 
and/or other ARV treatment. Please provide examples of the consequences 
of these challenges.

Coordination with non-U.S. organizations (host government, multilateral 
and nongovernmental organizations, other bilateral donors): 

10.a. How does your mission/field office interface with the host 
government in your country on the programs listed in 6.a.? The 
procurement activities listed in 6.b.?

10.b. What are the key challenges your mission/field office has faced 
in working with the host government? Please provide examples of the 
consequences of these challenges.

11.a. With what other non-U.S. organizations does your mission/field 
office currently coordinate on the programs listed in 6.a.? The 
procurement activities listed in 6.c.?

11.b. Through what mechanisms? Are there any established mechanisms to 
ensure coordination?

12.a. Please describe the key challenges your mission/field office has 
faced coordinating with non-U.S. organizations on VCT, PMTCT, PMTCT 
Plus, and/or other ARV treatment. Please provide examples of the 
consequences of these challenges.

12.b. Based on your experience at your current post, please rate the 
extent to which you experience difficulties coordinating with the 
following partners: 

Coordinating with other U.S. agencies; 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

Coordinating with host government; 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

Coordinating with multilateral organizations (World Bank, Global Fund, 
UN organizations); 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

Coordination with other bilateral donors; 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

Coordinating with NGOs and/or the private sector; 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

12.c. If you have not already addressed this issue in question 12.a., 
with which type of partner do you experience the most coordination 
challenges? Please explain.

13.a. Based on our research to date, we have identified certain 
function-related coordination challenges that may arise among 
stakeholders in a given country: 

* harmonization of treatment protocols: 

* harmonization of procurement policies: 

* harmonization of monitoring and evaluation indicators: 

* harmonization of data collection methods: 

* harmonization of data reporting requirements: 

* harmonization of feedback to those who administer services and/or 
collect data: 

Are there any other functional areas that you think raise or may raise 
significant coordination challenges?

13.b. Based on your experience at your current post, please rate the 
extent to which you experience difficulties coordinating with other 
partners in the following areas: 

Harmonization of treatment protocols; 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

Harmonization of procurement policies; 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

Harmonization of monitoring and evaluation indicators (i.e., the data 
collected); 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

Harmonization of data collection methods; 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

Harmonization of data reporting requirements; 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

Coordinating provision of feedback to those who administer services 
and/or collect data; 
Very great extent: 
Great extent: 
Moderate extent: 
Some or little extent: 
No extent: 
No basis to judge: 

13.c. If you have not already addressed this issue in question 12.a. or 
13.a., with which area do you experience the most coordination 
challenges? Please explain.

14.a. What activities did your mission/field office initiate with 
funding from the PMTCT Initiative?

14.b. What were the key challenges you faced on the PMTCT Initiative 
and what were the lessons learned that can inform the implementation 
of PEPFAR?

15. Could you please tell us about a successful ARV treatment program 
in the country where you serve? What factors contribute to its success? 
Could you please provide contacts (phone, email address) with whom we 
can follow up, if necessary?: 

16. What changes--if any--would you suggest be made to facilitate 
interagency and international coordination in scaling up ARV 
treatment? 

[End of section]

Appendix III: U.S. and International HIV/AIDS Funding: 

With the advent of PEPFAR, U.S. proposed funding for HIV/AIDS-related 
activities in the 14 focus countries increased substantially, as shown 
in figure 5.

Figure 5: U.S. HIV/AIDS Funding in the 14 PEPFAR Focus Countries, 
Fiscal Years 2003 and 2004: 

[See PDF for image] 

Note: This information is provided solely for background purposes; 
therefore, we did not assess the reliability of these data.

[A] These figures represent USAID and HHS/CDC combined spending limits 
for HIV/AIDS activities in each of the countries in fiscal year 2003. 
Other U.S. agencies, including the Departments of Agriculture, Defense, 
Labor, and State, allocated additional, smaller amounts of funds for 
HIV/AIDS activities in fiscal year 2003 that may have been spent in the 
PEPFAR focus countries. The National Institutes of Health obligated a 
total of $78 million in fiscal year 2003 to the 14 countries for HIV/
AIDS research, and estimated fiscal year 2004 obligations to the 14 
countries at $86 million.

[B] These figures represent planned allocations determined by the 
Office of the U.S. Global AIDS Coordinator for each of the 14 countries 
for fiscal year 2004. The allocations include funds from USAID, HHS, 
and the Coordinator's Office and will be used by USAID, HHS, the 
Department of Defense, State Department, and the Peace Corps to carry 
out PEPFAR activities.

Figure 6: World Bank, Global Fund, HHS/CDC, and USAID HIV/AIDS Funding 
in the PEPFAR Focus Countries: 

[See PDF for image] 

Note: This information is provided solely for background purposes; 
therefore, we did not assess the reliability of these data.

[A] World Bank projects in the PEPFAR countries are for approximately 
5-year periods. Three projects began in 2001, one project began in 
2002, four projects began in 2003, and one is scheduled to begin in 
2004. As of December 2003, 16 percent of the total funds obligated had 
been disbursed. Obligations refer to the total amount committed for the 
duration of the project in that country. Disbursed amounts refer to the 
amount of funds withdrawn by the country from the World Bank.

[B] The Global Fund figures are 2-year approved funding amounts. The 
Fund approved most of these amounts in 2003, two in 2002, and three in 
2004. As of April 2004, there were a total of 32 HIV/AIDS-related 
grants for the 14 countries, 7 of which had not yet been signed. 
Seventeen percent of the total grant funds approved had been disbursed.

[C] Obligations are binding agreements that will result in immediate or 
future outlays. Other U.S. agencies, including the Departments of 
Agriculture, Defense, Labor, and State, may have obligated additional, 
smaller amounts of funds to the PEPFAR countries for HIV/AIDS-related 
activities. HHS/NIH obligated a total of $78 million to the 14 
countries for HIV/AIDS research in fiscal year 2003.

[End of figure] 

[End of section]

Appendix IV: The Structure of the Office of the U.S. Global AIDS 
Coordinator: 

The Office of the U.S. Global AIDS Coordinator was organized to manage 
U.S. policies and programs to combat the global AIDS epidemic and to 
support administrative, communications, and diplomatic efforts. To 
accomplish this mission, the office has eight specialized units (see 
fig. 7).

Figure 7: Office of the U.S. Global AIDS Coordinator Organization 
Chart: 

[See PDF for image] 

Note: in addition to the areas shown here, the Coordinator's Office 
also includes staff focused on strategic policy and planning, issue 
support and analysis, several administrative assistants, and 6 
unallocated FTEs.

[A] FTE = full-time-equivalent position, equal to one person working 
full time, two people working half time, and so on.

[End of figure] 

* Management Services--provides administrative support to the office, 
including human resources, information management, and operational 
budget.

* Communications--plans and implements all communications support for 
PEPFAR activities while promoting the involvement of public and private 
organizations.

* Diplomatic Liaison--prepares strategic plans, conducts activities to 
promote international involvement, and coordinates international 
response on HIV/AIDS by working with non-U.S. stakeholders.

* Training and Human Resources--oversees human capacity and development 
activities and develops, implements, and monitors training programs.

* Program Services--develops and monitors the 14 countries' PEPFAR 
implementation plans and provides technical and clinical support to the 
focus countries and for all other activities conducted by the Global 
AIDS Coordinator.

* Monitoring, Evaluation, and Strategic Information--evaluates 
progress toward PEPFAR goals and the impact of PEPFAR activities; works 
with the international community to harmonize information collection 
and serves as the liaison to both the research community and the 
research and information divisions of implementing agencies.

* Government Relations--responds to congressional requests for 
information, communicates policy to the Congress, and prepares 
congressional reports and compliance documents.

* Budget and Appropriations--develops the annual program budget for the 
Coordinator's Office and serves as the liaison to the White House, 
administrative departments and agencies, and the field on program 
budget issues, including disbursement, tracking, and reporting.

As of June 25, 2004, 69 percent of the positions shown in figure 7 were 
staffed. Positions within the Coordinator's Office are filled with a 
combination of permanent hires and individuals on reimbursable and 
nonreimbursable detail from other sections of the State Department or 
other agencies.

[End of section]

Appendix V: PEPFAR Obligations as of March 31, 2004: 

The Office of the U.S. Global AIDS Coordinator reported that, together 
with USAID and HHS, it had obligated a total of $346.9 million in 
PEPFAR funds as of March 31, 2004.[Footnote 45] These funds were 
obligated by means of tracks 1 and 1.5 through many awards to 
implementing entities in the 14 focus countries for activities related 
to HIV/AIDS treatment, prevention, and care, as follows.

* Track 1 provided rapid funding to organizations such as U.S.-based 
NGOs that can respond quickly in more than one country. As of March 31, 
2004, the Coordinator's Office had awarded a total of $114.7 
million[Footnote 46] in five areas: (1) modifying behavior by 
encouraging abstinence and faithfulness ($4.9 million obligated by 
USAID);[Footnote 47] (2) providing care for AIDS orphans and vulnerable 
children ($4.7 million obligated by USAID); (3) providing ARV therapy 
for those infected with HIV ($92 million obligated by HHS); and (4) 
preventing HIV transmission through safe medical injection ($13.1 
million obligated by USAID and HHS).

* Track 1.5 provided rapid funding to programs run by organizations in 
individual countries. USAID and HHS obligated a total of $232 million 
under track 1.5 for all 14 countries combined as of March 31, 2004. 
Like track 1 funding, this funding was to continue and expand ongoing 
activities. When allocating funding under track 1.5, U.S. missions were 
encouraged to consider programs that build on the PMTCT Initiative, in 
particular those that expand treatment to cover mothers and their 
partners.

Track 2 provides funding for each country's first annual operational 
plan. The Coordinator will assess annual funding levels in consultation 
with the U.S. agencies and Chiefs of Mission in each country and 
release funds after approving each country's plan. According to 
guidance provided by the Coordinator's Office, these assessments are 
meant to ensure that U.S. agencies in each country are leveraging their 
strengths and coordinating their efforts. As of May 31, 2004, the 
Coordinator's Office had approved 14 countries' operational plans 
totaling $589,401,340.

[End of section]

Appendix VI: Detailed Analysis of Challenges Identified in Structured 
Interviews: 

Figures 8 through 12 provide more information on the challenges that 28 
respondents in the field identified during the structured interviews. 
To generate these figures, we separately analyzed responses in each of 
the five main challenge categories and placed them in specific 
subcategories within each challenge category. We then tallied the 
number of respondents in each of the subcategories to generate figures 
8 through 12. Many respondents reported challenges in more than one 
category or subcategory.

Figure 8: Coordination Challenges Identified by Respondents: 

[See PDF for image]

Note: All 28 respondents identified coordination challenges. As noted 
on pp. 14 and 15, 27 respondents reported challenges coordinating with 
non-U.S. government groups as a whole (including host governments, 
among all stakeholders, and with other stakeholders) and 24 reported 
challenges coordinating with other U.S. agencies in the field and/or 
headquarters.

[A] The majority of responses falling into this category referred to 
harmonization of policies and activities among all or most groups 
involved in HIV/AIDS program expansion.

[B] Other stakeholders include multilateral organizations, bilateral 
organizations, NGOs, and the private sector.

[End of figure]

Figure 9: U.S. Policy Constraints Identified by Respondents: 

[See PDF for image] 

Note: Twenty-five respondents identified challenges regarding U.S. 
policy constraints. In addition to the five constraints shown, two or 
fewer respondents cited the following constraints: agencies have 
different auditing requirements for non-U.S. grantees; PEPFAR needs to 
invest in building sustainable capacity to address HIV/AIDS rather than 
investing in short-term projects; and PEPFAR's focus is less well 
defined than that of the PMTCT Initiative.

[A] These issues include conforming to spending percentages in the 
PEPFAR authorizing legislation; HHS and USAID operating under different 
laws and regulations; and whether PEPFAR resources can be channeled 
through U.N. agencies.

[End of figure] 

Figure 10: Host Country Human Resource Challenges Identified by 
Respondents: 

[See PDF for image] 

Note: Twenty-three respondents identified challenges regarding host 
country human resources. In addition to the three challenges shown, two 
or fewer respondents cited the following challenges: lack of staff 
motivation, host government policies regarding the use and hiring of 
doctors, and difficult personalities.

[End of figure] 

Figure 11: Host Government Constraints Identified by Respondents: 

[See PDF for image] 

Note: Nineteen respondents identified challenges regarding host 
government constraints.

[End of figure] 

Figure 12: Infrastructure and Logistics Challenges Identified by 
Respondents: 

[See PDF for image] 

Note: Sixteen respondents identified challenges regarding 
infrastructure and logistics.

[End of figure] 

[End of section]

Appendix VII: Analysis of Difficulty of Coordination: 

Our structured interview analysis contained two closed-ended questions 
that asked respondents to rank the difficulty of (1) coordinating with 
various groups and (2) coordinating with all parties on specific 
activities (see questions 12.b and 13.b in app. II).

When asked to rank the difficulty of coordinating with various groups, 
15 respondents indicated that they experienced at least moderate 
difficulty coordinating with the host government in the country where 
they serve, and 13 reported the same level of difficulty coordinating 
with multilateral entities, such as the World Bank and U.N. 
organizations (see table 2). By comparison, only 2 respondents stated 
they had at least moderate difficulty coordinating with other U.S. 
government entities. The majority of respondents reported only a 
minimal degree of difficulty ("some or little extent" or "no extent") 
coordinating with other bilateral donors, NGOs, and the private sector. 
Respondents said that the difficulty coordinating with nongovernmental 
and private organizations was that they are so numerous and not all are 
known.

Question 12.b: Based on your experience at your current post, please 
rate the extent to which you experience difficulties coordinating with 
the following partners: A: 

Table 2: Difficulty Coordinating with Various Groups as Reported by 
Respondents: 

Coordination with other U.S. agencies; 
Very Great Extent: 1; 
Great Extent: -; 
Moderate Extent: 1; 
Some or Little Extent: 17; 
No Extent: 8; 
No Basis to Judge: -; 
Moderate or Greater: Extent: 2.

Coordination with host government; 
Very Great Extent: -; 
Great Extent: -; 
Moderate Extent: 15; 
Some or Little Extent: 9; 
No Extent: 2; 
No Basis to Judge: 1; 
Moderate or Greater: Extent: 15.

Coordination with multilateral organizations (World Bank, Global Fund, 
UN organizations); 
Very Great Extent: -; 
Great Extent: -; 
Moderate Extent: 13; 
Some or Little Extent: 11; 
No Extent: 2; 
No Basis to Judge: 1; 
Moderate or Greater: Extent: 13.

Coordination with other bilateral organizations; 
Very Great Extent: -; 
Great Extent: -; 
Moderate Extent: 3; 
Some or Little Extent: 18; 
No Extent: 4; 
No Basis to Judge: 2; 
Moderate or Greater: Extent: 3.

Coordination with NGOs and/or the private sector; 
Very Great Extent: - ; 
Great Extent: -; 
Moderate Extent: 4; 
Some or Little Extent: 16; 
No Extent: 6; 
No Basis to Judge: 1; 
Moderate or Greater: Extent: 4.

Source: GAO.

[A] Twenty-seven of the 28 respondents answered this question.

[End of table]

Regarding coordination on specific activities, 16 respondents reported 
moderate or greater difficulty coordinating provision of feedback to 
those who administer services or collect data, and 15 reported a 
similar degree of difficulty in coordinating procurement policies and 
data reporting requirements (see table 3). Half of the 26 respondents 
who answered this question reported moderate or greater difficulty 
coordinating data collection methods. The majority reported little or 
no difficulty coordinating treatment protocols or data to be 
collected.

Question 13.b: Based on your experience at your current post, please 
rate the extent to which you experience difficulties coordinating with 
other partners in the following areas: A: 

Table 3: Difficulty Coordinating on Various Issues as Reported by 
Respondents: 

Harmonization of treatment protocols; 
Very Great Extent (1): 1; 
Great Extent (2): 2; 
Moderate Extent (3): 5; 
Some or Little Extent (4): 5; 
No Extent (5): 10; 
No Basis to Judge (6): 3; 
Moderate or greater: 8.

Harmonization of procurement policies; 
Very Great Extent (1): 1; 
Great Extent (2): 5; 
Moderate Extent (3): 9; 
Some or Little Extent (4): 3; 
No Extent (5): 3; 
No Basis to Judge (6): 5; 
Moderate or greater: 15.

Harmonization of monitoring and evaluation indicators (i.e., the data 
collected); 
Very Great Extent (1): 2; 
Great Extent (2): 1; 
Moderate Extent (3): 7; 
Some or Little Extent (4): 13; 
No Extent (5): 3; 
No Basis to Judge (6): -; 
Moderate or greater: 10.

Harmonization of data collection methods; 
Very Great Extent (1): 2; 
Great Extent (2): -; 
Moderate Extent (3): 11; 
Some or Little Extent (4): 10; 
No Extent (5): 3; 
No Basis to Judge (6): -; 
Moderate or greater: 13.

Harmonization of data reporting requirements; 
Very Great Extent (1): 4; 
Great Extent (2): 3; 
Moderate Extent (3): 8; 
Some or Little Extent (4): 9; 
No Extent (5): 2; 
No Basis to Judge (6): -; 
Moderate or greater: 15.

Coordinating provision of feedback to those who administer services 
and-or collect data; 
Very Great Extent (1): 3; 
Great Extent (2): 3; 
Moderate Extent (3): 10; 
Some or Little Extent (4): 8; 
No Extent (5): 1; 
No Basis to Judge (6): 1; 
Moderate or greater: 16. 

Source: GAO.

[A] Twenty-six of the 28 respondents answered this question.

[End of table]

[End of section]

Appendix VIII: Joint Comments from the Department of State, HHS, and 
USAID: 

June 25, 2004:

Dear Mr. Gootnick:

On behalf of the Departments of State, Health and Human Services (HHS) 
and the United States Agency for International Development (USAID), we 
appreciate the opportunity to comment on the draft General Accounting 
Office (GAO) report, U.S. AIDS Coordinator Addressing Some Key 
Challenges to Expanding Treatment But Others Remain (GAO-04-784).

In the past few months, we have quickly launched President Bush's 
historic Emergency Plan for AIDS Relief to bring prevention, treatment 
and care to millions of people living with HIV/AIDS. We concur with the 
overall conclusion reached by the report that while we have addressed a 
number of key challenges in providing services, a number of challenges 
remain for the medium and long-term. However, we do note that the GAO 
report was commissioned and interviews were conducted in the first few 
months of implementation. Program efforts and activities have 
progressed far beyond what the report describes, and work is underway 
to address the majority of challenges and issues raised.

Your report rightly describes the urgency of action inherent in 
President Bush's announcement of the Emergency Plan in January 2003, 
With the unwavering support of the American people, Congress passed the 
United States Leadership Against HIV/AIDS, Tuberculosis, and Malaria 
Act of 2003 in May of 2003, which authorized activities to be carried 
out under the President's Emergency Plan, And, less than five months 
after passage of the bill, President Bush nominated and the Senate 
confirmed Randall L. Tobias as the first U.S. Global AIDS Coordinator 
to lead an expanded and coordinated U.S. response to the international 
HIV/AIDS pandemic.

In the nine months since Senate confirmation on October 3, 2003, 
Ambassador Tobias has rapidly marshaled the resources of the United 
States Government to begin implementing the Emergency Plan. He started 
his work 
predicated on two fundamental concepts heralded by President Bush: 
focus and innovation, Given the vast development, health and other 
related challenges present in the focus countries of the Emergency 
Plan, Ambassador Tobias has been steadfast in his commitment to 
implementing a focused initiative --focused on integrating HIV/AIDS 
prevention, care, and treatment, and focused on rapidly achieving 
results in a select number of countries that represent nearly half of 
the global pandemic in order to demonstrate that a program of this 
scope and scale is not only feasible but successful, He has also been 
determined to seek innovation in our AIDS response and not simply to 
conduct "business as usual," From bringing in new partners, such as 
faith-and community-based organizations, to implementing a new 
leadership model for coordinating U.S. Government programs and 
personnel, the Emergency Plan for AIDS Relief is creating opportunities 
to find new and more effective ways to turn the tide of HIV/AIDS.

In fact, the progress made to date in addressing many of the concerns 
raised in the draft report reflects some early achievements already 
secured by the Emergency Plan, On February 23, 2004, less than one 
month after the Congress appropriated fiscal year 2004 funding, 
Ambassador Tobias announced the first release of funds for focus 
country programs, totaling $350 million, Subsequently, U.S. Government 
Missions have developed and Ambassador Tobias has approved annual 
operational plans for HIV/AIDS prevention, treatment and care 
activities in each of the focus countries, Pending Congressional 
approval, an additional $515 million will begin flowing to the focus 
countries at the end of June 2004, By the end of the program's first 
year, over 200,000 people are expected to be on ARV treatment and over 
1,1 million people infected or affected by HIV/AIDS will benefit from 
care services.

Progress is especially visible regarding the purchase of anti-
retroviral (ARV) drugs under the Emergency Plan, The Office of the U.S. 
Global AIDS Coordinator has consistently and repeatedly expressed its 
policy to provide, through the Emergency Plan, HIV/AIDS drugs at the 
lowest possible cost, regardless of origin or who produces them, as 
long as the drugs are determined to be safe, effective, and of high 
quality, These drugs may include brand name products, generics, or 
copies of brand name products. At the present time, there are no true 
generic versions of these HIV/AIDS drugs because they all remain under 
intellectual property protection here in the United States.

On May 16, 2004, HHS Secretary Tommy G, Thompson announced the HHS Food 
and Drug Administration's (FDA) expedited process for the review of 
applications for HIV/AIDS drug products that combine already-approved 
individual HIV/AIDS therapies into a single dosage (also known as 
fixed-dose combinations or "FDC"s), as well as new co-packaging of 
existing therapies. (Please obtain HHS/FDA draft guidance on the new 
review process at http://www.fda.gov/oc/initiatives/hiv/
hivguidance.html, or call 301-827-4573.):

At the same time, Ambassador Tobias announced that when a new 
combination drug for HIV/AIDS treatment receives a positive outcome 
under this expedited FDA review, the Office of the U.S. Global AIDS 
Coordinator will recognize that result as evidence of the safety and 
efficacy of that drug. The drug will then become an eligible candidate 
for purchase with funding from the President's Emergency Plan, so long 
as international patent agreements and local government policies allow 
their purchase, The expedited HHS/FDA review process, combined with the 
work of local drug regulatory authorities in the affected countries, 
will provide a mechanism to ensure that companies who provide drugs for 
the President's Emergency Plan meet and maintain safety, efficacy, and 
quality standards, Also, Ambassador Tobias expressed his intent to use 
his authority to waive any "Buy American" requirements that might 
normally apply in certain situations to these drugs. We are confident 
that this process will bring safe and effective drugs to millions of 
Emergency Plan patients.

Less than one month after this announcement, senior officials from the 
U.S. Government initiated outreach efforts to pharmaceutical companies 
in Africa and Asia that have products that could enter the HHS/FDA's 
review process. In addition, USAID posted recently on the Internet a 
special notice for industry comments on the Draft Statement of Work for 
a contract to establish a safe, secure, reliable, and sustainable 
supply chain and to procure pharmaceuticals and other products needed 
to provide care and treatment of persons with HIV/AIDS and related 
infections. USAID plans to formally release the request for proposal 
(RFP) soon and award the contract later this year for interagency use.

However, as the draft report suggests, the most limiting factor in many 
of the focus countries is not necessarily drugs - it is the need for 
institutional strengthening of human and physical capacity in the 
health care systems. Many of the focus countries are desperately short 
of health care workers and health care infrastructure, Both are needed 
to deliver treatment broadly, effectively, and in a sustainable manner.

The focus on health care systems provides a base from which to rapidly 
expand essential services. Health care systems in the target countries, 
and indeed in much of the world, are currently organized around the 
concept of a "network 
model" comprising central medical facilities, district-level 
hospitals, and local health clinics, supplemented by private, often 
faith-based, facilities. This network concept of public and private 
health care institutions currently provides the backbone design of 
health care delivery systems, and many of the focus countries-Nigeria, 
Uganda, and Haiti, for example -have planned their HIV/AIDS national 
strategies with networked health care systems as the foundation.

The current capacity of these existing health systems to deliver HIV/
AIDS prevention, treatment, and care is limited, however, particularly 
in rural areas. The Emergency Plan, in accordance with national health 
and HIV/AIDS strategies and with the intent to build long-term 
sustainability, will strengthen linkages between central facilities and 
international and private support to build the human and physical 
capacity of different network components and reinforce network-wide 
linkages in order to deliver quality HIV/AIDS care more effectively to 
those who need them most.

Because the use of medical volunteers can be highly cost effective in 
certain situations, the Office of the U.S. Global AIDS Coordinator 
requested the Institute of Medicine (IOM) conduct a study of 
alternative mechanisms to mobilize the quantity and qualities of 
relevant U.S. technical experts and expert networks needed to support 
the Emergency Plan. The study will examine short and long-term options 
for mobilizing, preparing, sending, managing, and compensating 
volunteer U.S. health professionals who would serve in the focus 
countries. The IOM is expected to complete this study by November 2004.

Further, efforts under the Emergency Plan will support the concept of 
"twinning" as a long-term solution to promote sustainability and 
capacity building by forming relationships that can provide technical 
assistance over many years.

The World Health Organization is completely supportive of the concept 
of twinning, as are many European donor governments who have gathered 
together under the umbrella of the Ensemble pour une Solidarite 
Therapeutique Hospitaliere en Reseau (Esther) initiative, with which 
the Emergency Plan will work closely.

Additionally, the Office is developing a longer-term training and 
capacity-building strategy that includes strengthening training 
systems and local training institutions, and improving human resource 
policies and planning at the national level, In the meantime, the 
Emergency Plan is supporting training efforts in all of the focus 
countries, from doctors to community health workers, as well as 
indigenous trainers to expand the available pool of qualified health 
care workers.

To address immediate health care infrastructure needs, the Emergency 
Plan is upgrading and enhancing key health care structures to deliver 
HIV care across the focus countries. Mobile units will expand the reach 
of counseling and testing activities as well as increase the 
distribution network for the provision and monitoring of ARV 
medications.

As the report indicates, there are some key rules and regulations that 
affect the U.S. Government agencies and departments that are 
implementing the Emergency Plan in differing ways. The Office of the 
U.S. Global AIDS Coordinator has begun working with experts in each of 
the involved agencies and departments to fully define the operational 
challenges that exist and to identify a wide-range of solutions, Later 
this summer, the Coordinator's office will convene two meetings of 
expert field and headquarters staff to address and solve specific, 
immediate operational, management and administrative obstacles, such as 
contracting constraints, procurement mechanisms, staffing 
configurations, and auditing issues, These issues were raised as 
tantamount to successful program implementation during the three-day 
consultation with U.S. Embassy and agency field staff from the 14 focus 
countries that the Office of the Global AIDS Coordinator convened in 
Johannesburg, South Africa in early June.

As the Emergency Plan for AIDS Relief is an integral part of the global 
response to the HIV/AIDS pandemic, coordination is key to filling gaps 
and minimizing duplication, As such, all participating U.S. Government 
agencies are working closely together under the leadership of the 
Office of the U.S. Global AIDS Coordinator, There is a strong 
commitment to inter-agency collaboration, and the Ambassadorial 
leadership of in-country teams is proving to be a dynamic catalyst for 
coordination and effectiveness, These efforts are part of the annual 
program monitoring and evaluation process Ambassador Tobias is leading 
to ensure Emergency Plan accountability and effectiveness, In pursuit 
of this aim, the Inspector Generals from the participating agencies are 
cooperating with each other and the Office of the U.S. Global AIDS 
Coordinator, especially as all foresee the need for field audits as the 
initiative proceeds.

While implementation efforts have been rapid, the U.S. Government is 
striving to coordinate and collaborate our efforts to respond to local 
needs and to be consistent with host government strategies and 
priorities. It is important to recognize, however, that legislative and 
policy constraints will affect the range of activities the Emergency 
Plan pursues under a country's national strategy, Thus, coordination 
with host governments and other partners, especially with international 
partners, such as UNAIDS, the World Health Organization, and the 
Global Fund to Fight HIV/AIDS, Tuberculosis and Malaria, as well as 
non-governmental organizations, faith-and community-based 
organizations, private-sector companies, and others, is key to address 
needs outside of the scope of the Emergency Plan.

In conclusion the U.S. Government is making overwhelming progress under 
the President's Emergency Plan for AIDS Relief to bring hope and care 
to millions around the world, Much remains to be done, However, in 
leading the world's response, we believe we can restore lives, preserve 
families, and help nations progress forward.

Sincerely,

Signed by: 

Christopher Burnham:

Assistant Secretary for Resource Management and Chief Financial 
Officer: 

U.S. Department of State:

Signed by: 

Dara Corrigan: 
Acting Principal Deputy Inspector General: 
Department of Health and Human Services: 

John Marshall:

Assistant Administrator: 
Bureau for Management:
U.S Agency for International Development:

Mr. David Gootnick, Director, 
International Affairs and Trade,
U.S. General Accounting Office, 
441 G Street NW, 
Washington, D.C. 20548.

[End of section]

Appendix IX: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Cheryl Goodman, (202) 512-6571: 

Staff Acknowledgments: 

In addition to the person named above, Kate Blumenreich, Martin de 
Alteriis, David Dornisch, Kay Halpern, Reid Lowe, Rebecca L. Medina, 
Mary Moutsos, and Tom Zingale made key contributions to this report.

(320205): 

FOOTNOTES

[1] P.L. 108-25.

[2] The President's announcement targeted 14 countries: Botswana, Cte 
d'Ivoire, Ethiopia, Guyana, Haiti, Kenya, Mozambique, Namibia, Nigeria, 
Rwanda, South Africa, Tanzania, Uganda, and Zambia; the President 
announced a 15th country, Vietnam, on June 23, 2004. In addition to 
these focus countries, the Coordinator's Office will oversee HIV/AIDS 
activities in 96 other countries.

[3] In the two countries where there is no USAID mission (Botswana and 
cte d'Ivoire), we interviewed the official in charge of USAID's 
Southern Africa Regional HIV/AIDS program and the head of health issues 
for USAID's Western Africa Regional Office, respectively.

[4] These staff spoke with us with the understanding that individual 
respondents and the countries where they serve would not be named in 
our report. The challenges identified include those experienced by U.S. 
officials during an earlier program that used ARV drugs to prevent HIV 
transmission from mothers to infants.

[5] There is one brand-name FDC that combines three drugs in one pill; 
however, HHS treatment guidelines do not recommend this drug 
combination because it is ineffective.

[6] Fixed-dose combinations of ARV drugs are single pills that contain 
more than one ARV medication. Reducing the number of pills that must be 
taken at any one time is intended to simplify the regimen and thus 
promote adherence and decrease the risk of resistance. 

[7] In guidelines to field staff, the Coordinator's Office defines 
stringent regulatory authority as a drug regulatory body that closely 
resembles the HHS/FDA in standards utilized in its operations. The 
Coordinator's Office considers as stringent regulatory authorities 
regulatory agencies in countries that participate in the International 
Conference on Harmonization (ICH). The ICH is an agreement between the 
European Union, Japan, and the United States to harmonize regulatory 
requirements for the testing, application, and approval of 
pharmaceutical medications; it is a joint initiative between government 
regulators and industry manufacturers. The Coordinator's Office also 
considers Canada's drug regulatory body to be a stringent regulatory 
authority and states that other countries may be considered on a case-
by-case basis to have a stringent regulatory body if the countries have 
implemented ICH guidelines and resemble the HHS/FDA in operation. 

[8] According to technical comments on a draft of this report that were 
submitted jointly by the Coordinator's Office, HHS, and USAID, patents 
and/or exclusivity protect most of these brand-name drugs in the United 
States and overseas. 

[9] The Global Fund is a multilateral, non-profit, public-private 
mechanism to rapidly disburse grants to augment existing spending on 
the prevention and treatment of HIV/AIDS, tuberculosis, and malaria 
while maintaining sufficient oversight of financial transactions and 
program effectiveness. See U.S. General Accounting Office, Global 
Health: Global Fund to Fight AIDS, TB and Malaria Has Advanced in Key 
Areas, but Difficult Challenges Remain, GAO-03-601 (Washington, D.C.: 
May 7, 2003).

[10] Intrapartum and Neo-Natal Single Dose Nevirapine Compared with 
Zivovudine for Prevention of Mother-to-Child Transmission of HIV-1 in 
Kampala, Uganda: HIVNET 012 Randomized Trials, The Lancet, September 4, 
1999. 

[11] These HHS agencies, together with the HHS/CDC, received money 
through PEPFAR in fiscal year 2004. Other HHS agencies, such as the 
Food and Drug Administration, the Administration for Children and 
Families, the Indian Health Service, the Office of the Assistant 
Secretary for Planning and Evaluation, and other institutes of the 
National Institutes of Health, have not received PEPFAR funds but are 
providing planning and other input to PEPFAR.

[12] Budget officials in the Coordinator's Office said that only those 
funds already appropriated to agencies were obligated by this target 
date. After Congress appropriated funds for PEPFAR on January 23, 2004, 
agencies obligated the remaining track 1 and 1.5 funds, according to 
officials in the Coordinator's office, HHS, and USAID. 

[13] According to the Federal Grant and Cooperative Agreement Act of 
1977, 31 U.S.C. 6301-6308, procurement contracts are used to acquire 
goods or services "for the direct benefit or use of the United States 
Government"; grant agreements are used to transfer funds to a recipient 
"to carry out a public purpose of support or stimulation authorized by 
a law of the United States" in which "substantial involvement is not 
expected" by the U.S. agency providing the grant; and cooperative 
agreements are similar to grant agreements except that "substantial 
involvement is expected between the agency and the recipient." 

[14] This may be due to the fact that the 3-by-5 campaign is the 
largest and most recent international ARV treatment initiative.

[15] The United States is one of the largest contributors to the Global 
Fund, and the U.S. Secretary of Health and Human Services currently 
chairs the Fund.

[16] These requirements may be waived if, among other factors, 
information is available to attest to the safety, efficacy, and quality 
of the product or if the product meets the standards of the HHS/FDA or 
other controlling U.S. authority.

[17] The communication included input from USAID and HHS/CDC field 
staff in 13 of the 14 PEPFAR focus countries as well as U.S.-based 
officials from these and other agencies.

[18] According to procurement officers at HHS/CDC headquarters, 
embassies can write contracts for up to $250,000; contract agreements 
typically cover a longer period of time and more complex transactions 
than purchase orders.

[19] For example, according to a USAID legal official, for USAID and 
its grantees, the agency's source, origin, and nationality rules 
implement provisions of the Foreign Assistance Act of 1961, as amended, 
and other statutory provisions generally requiring the purchase of U.S. 
goods, regardless of whether the goods are purchased or used overseas. 
HHS/CDC, on the other hand, does not have similar agency regulations or 
implementing procedures other than those stated in the Buy American Act 
(U.S.C. 10a-10d). However, this act applies to supplies acquired for 
use in the United States. Since PEPFAR supplies will be used outside 
the United States, HHS/CDC has stated that the Buy American Act would 
not apply to its PEPFAR grantees who acquire supplies for use overseas. 

[20] For example, taxation would include value added taxes and customs 
duties. In addition, under the legislation, the Secretary of State 
"shall expeditiously seek to negotiate amendments to existing bilateral 
agreements as necessary to conform with this requirement."

[21] The HHS/CDC audit requirements also state that the U.S.-based firm 
conducting the audit has international branches and current licensure/
authority in the country where the audit is being conducted.

[22] These organizations are USAID contractors working overseas.

[23] WHO and World Bank, High-Level Forum on the Health Millennium 
Development Goals: Improving Health Workforce Performance, Issues for 
Discussion, Session 4 (Geneva, Switzerland: 2003).

[24] WHO, Workshop on Human Resources and Service Delivery Aspects of 
Scaling Up ARV Treatment in Resource-limited Settings: A Preliminary 
Discussion Paper (draft, October 2003).

[25] Christoph Kurowski, Kaspar Wyss, Salim Abdulla, N'Diekhor Ymadji, 
and Anne Mills, Human Resources for Health: Requirements and 
Availability in the Context of Scaling Up Priority Interventions in Low 
Income Countries: Case Studies from Tanzania and Chad, January 2003. 
The purpose of the study was to explore the role and importance of 
human resources for the expansion of health services in low-income 
countries. The study was conducted under the auspices of the London 
School of Hygiene and Tropical Medicine, Health Economics and Financing 
Programme.

[26] In remarks before a Center for Strategic and International Studies 
forum on "Botswana's Strategy to Combat HIV/AIDS: Lessons for Africa, 
and President Bush's Emergency Plan for AIDS Relief," November 12, 
2003, Washington, D.C.

[27] USAID, Academy for Educational Development, Support for Analysis 
and Research in Africa (SARA), Jenny Huddort, Oscar F. Picazo, and 
Sambe Duale, The Health Sector Human Resource Crisis in Africa: An 
Issues Paper (Washington, D.C.: 2003). 

[28] Ibid. Another USAID-funded report, on the Zambian HIV/AIDS 
workforce, cited an average annual salary for a doctor in Zambia of 
$7,525 in the public sector, $9,240 at an NGO, and $17,050 in the 
private sector (see USAID, Initiatives, Inc., and University Research 
Co. LLC, Jenny Hoddart, Rebecca Furth, Dr. Joyce Lyons, HIV/AIDS 
Workforce Study (Washington, D.C.: 2003)).

[29] WHO, Recruitment of Health Workers from the Developing World: 
Report by the Secretariat (Geneva, Switzerland: 2004).

[30] WHO, The World Health Report 2004: Changing History (Geneva, 
Switzerland: 2004).

[31] WHO and World Bank, High-Level Forum on The Health Millennium 
Development Goals, Monitoring the Health MDGS, Issues for Discussion: 
Session 3 (2003).

[32] For example, the data collected for treatment programs include the 
number of treatment facilities or programs and the number of people 
being treated. (See pp. 43-44 for a more detailed discussion of these 
indicators.) 

[33] WHO, World Health Report 2000 Health Systems: Improving 
Performance (Geneva, Switzerland: 2000), annex table 10.

[34] In many countries, such structures have been set up to facilitate 
the development and implementation of Global Fund and World Bank 
programs. The structures have had varying degrees of success.

[35] The Coordinator's Office, together with WHO, UNAIDS, and 
regulatory agencies from 23 countries, held a conference in Gaborone, 
Botswana, on March 29-30, 2004, to specify principles to be applied 
when considering the use of FDCs. 

[36] Neither the technical nor official comments on a draft of this 
report that were submitted jointly by the State Department, HHS, and 
USAID address whether the process supercedes the Coordinator's 
previously stated policy of purchasing only drugs approved by stringent 
regulatory authorities that include bodies other than the HHS/FDA. 

[37] The Coordinator's Office defines short-term interventions as those 
that generally take less than a year to implement, and long-term 
interventions as those spanning PEPFAR's 5-year time frame and beyond. 

[38] The Coordinator's Office expects to make an award by September 30, 
2004, in response to a request for applications for twinning 
activities, according to technical comments on a draft of this report 
that were submitted jointly by the Coordinator's Office, HHS, and 
USAID. Multiple missions had visited or were in the process of visiting 
countries to provide technical assistance for human capacity 
development. 

[39] For example, many people who think they may be infected are too 
ashamed and afraid to be tested for the disease, fearing social 
isolation, rejection, or violence.

[40] The President announced a 15th country, Vietnam, on June 23, 2004. 

[41] These staff spoke with us with the understanding that individual 
respondents and the countries where they serve would not be named in 
our report. The challenges identified include those experienced by U.S. 
officials during an earlier program that used ARV drugs to prevent HIV 
transmission from mothers to infants.

[42] The key questions were 6.d, 6.e, 9, 10.b, 12.a, 12.b, 12.c, 13.a, 
13.b, 13.c, 14.b, and 16.

[43] We do not provide the number of responses here; individual 
respondents often provided several responses that fell into the same 
subcategory.

[44] The Office of the U.S. Global AIDS Coordinator prepared this 
report in collaboration with the Departments of State (including the 
U.S. Agency for International Development), Defense, Commerce, Labor, 
Health and Human Services (including the Centers for Disease Control 
and Prevention, the Food and Drug Administration, the Health Resources 
and Services Administration, the National Institutes of Health, and the 
Office of Global Health Affairs); and the Peace Corps.

[45] This information is provided solely for background purposes; 
therefore, we did not assess the reliability of these data. 

[46] Track 1 also provided $1 million to HHS and USAID for strategic 
information activities, including gathering and assessing data for 
monitoring and evaluating PEPFAR. 

[47] According to a budget official in the Coordinator's Office, most 
of the transferred funds were obligated through contracts or grant 
agreements with organizations that deliver services.

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Automated answering system: (800) 424-5454 or (202) 512-7470: 

Public Affairs: 

Jeff Nelligan, managing director, NelliganJ@gao.gov (202) 512-4800 U.S.

General Accounting Office, 441 G Street NW, Room 7149 Washington, D.C.

20548: