Copyright © AVERT

What is PEPFAR?

What is the President's Emergency Plan for AIDS Relief?

The President's Emergency Plan for AIDS Relief, also known as PEPFAR, is a five-year, $15 billion American Government initiative to combat the global HIV/AIDS epidemic.

When did PEPFAR start?

In his State of the Union Address in January 2003, President Bush made a commitment to substantially increase U.S. support to addressing HIV/AIDS worldwide.¹

"I ask the Congress to commit $15 billion over the next five years, to turn the tide against AIDS in the most afflicted nations of Africa and the Caribbean" - President Bush.

In May 2003, the U.S. Congress approved, and President Bush signed into law, the "United States Leadership Against HIV/AIDS, Tuberculosis and Malaria Act of 2003" (PL108-25).² This legislation approved expenditure of up to $15 billion over 5 years and it provides the legal and policy framework for the expenditure.

The first "new" money of $350 million was made available by Congress in January 2004.³ Full implementation of PEPFAR began in June 2004.

Is this the total U.S. Government expenditure on HIV/AIDS?

The sum of $15 billion is the proposed expenditure of the U.S. Government on HIV/AIDS outside of the U.S. over a five-year period. This is in addition to domestic HIV/AIDS expenditure for which $21 billion was requested for fiscal year (FY) 2006.

How is the money to be divided between different areas of work?

Congress required that the PEPFAR money should be divided in the following way:

1. 55% for the treatment of individuals with HIV/AIDS (and in FYs 2006 through 2008, 75% of this is to be spent on the purchase and distribution of antiretroviral drugs)
2. 15% for the palliative care of individuals with HIV/AIDS
3. 20% for HIV/AIDS prevention (of which at least 33% is to be spent on abstinence until marriage programmes)
4. 10% for helping orphans and vulnerable children (and in FYs 2006 through 2008, at least 50% (of the 10%) is to be provided through non-profit, non-governmental organisations, including faith-based organisations, that implement programmes at the community level).

So PEPFAR has a very strong emphasis on the provision of treatment and care for people with AIDS, with only a fifth of the money being for HIV prevention work. And in FY 2006 through 2008, forty-one per cent of the total money is to be spent on the purchase and distribution of antiretroviral drugs.

To ensure that the legislation was passed there had to be considerable cooperation between people of differing political, religious and ideological views, which resulted in many people being dissatisfied with the outcome. Some people were dismayed by the requirement that a third of prevention resources had to be spent on programmes promoting sexual abstinence before marriage. However, other people were equally dismayed that two thirds of prevention funds would be used for activities other than abstinence promotion, including condom dissemination.⁴

Who is in charge of PEPFAR?

Dr Mark Dybul is the U.S. Global AIDS Coordinator and is responsible for coordinating all U.S. Government HIV/AIDS activities. He is based in the Department of State and is directly responsible to the Secretary of State.

The previous Global AIDS Coordinator was Ambassador Randall Tobias, who held the post from October 2003 until early 2006. He left to become America's first ever Director of Foreign Assistance, as well as head of the U.S. Agency for International Development (USAID), which receives the bulk of PEPFAR money. Tobias resigned from both posts in April 2007 after he was found to have used an escort agency allegedly involved with prostitution.

Is the $15 billion all "new" money?

Prior to the start of PEPFAR the U.S. Government was already spending significant sums on combating HIV/AIDS outside of the U.S., with most of this expenditure being through bilateral agreements (agreements between the U.S. and one other country). Most of these agreements continued and became part of PEPFAR.

Of the proposed $15 billion, $9 billion was extra funding, $5 billion was to continue these existing bilateral agreements (i.e. existing commitments) and $1 billion was to be provided to the Global Fund to Fight AIDS, Tuberculosis and Malaria.

How much money has President Bush requested for PEPFAR so far and how much has been enacted?

In FY 2004, President Bush requested $1.9 billion for combating global HIV/AIDS, TB and Malaria, suggesting that the $3 billion was an average and that the annual expenditure would be increased over the five-year period. Congress increased President Bush's figure by $500 million, and in January 2004 appropriated $2.4 billion for HIV/AIDS, tuberculosis and malaria for FY 2004, which ended on 30th September 2004. Of this total, $850 million was "new" money.⁵

The total budget for global HIV and AIDS in FY 2005 was $2.7 billion, of which $2.6 billion was enacted. Within this amount, $1.37 billion was for the U.S. Global Coordinator's Office, and $347 was for the Global Fund.⁶

In FY 2006, President Bush requested, and Congress appropriated, approximately $3.2 billion.⁷

For FY 2007, Congress approved funding of $4.5 billion for HIV, tuberculosis and malaria including $724 million for the Global Fund. The total amount was $500 million more than President Bush had requested.⁸

President Bush has requested $5.4 billion for FY 2008, which would bring total spending over the five-year period to more than $18 billion (20% more than originally planned).⁹

What will happen to PEPFAR after 2008?

Although the five-year plan set out in the 2003 legislation ends in October 2008, officials have made it clear that America will continue to fund international AIDS programmes for many more years to come:

"There is no feeling here that this is just a five-year programme. There is no question that this kind of funding will stop. We are not walking away from the people who are on this programme. We have a commitment to make sure that people who get life-saving treatment ... will continue with that course of treatment." - Jimmy Kolker, deputy US Global AIDS coordinator.¹⁰

PEPFAR's budget will have to continue to increase each year in order to maintain and expand existing treatment programmes. In May 2007 President Bush announced his intention to double the initiative's budget to $30 billion to cover the five years from 2008 to 2013. He also emphasized the need to shift from an emergency plan to a sustainable response, and suggested new prevention, treatment and care targets.¹¹ Given that the budget for FY 2008 is expected to be at least $5.4 billion, the commitment of $30 billion over the following five years amounts to more or less flat funding, and may prove insufficient.

What is the Mother to Child Prevention Initiative?

This is a President Bush AIDS initiative, started in 2002, to reduce mother-to-child transmission of HIV in fourteen specific countries.¹² These fourteen countries are the same countries listed below which would later become the main beneficiaries of PEPFAR.

The initiative committed $500 million over five years, and had the aim of reaching one million women with HIV testing and counselling and providing antiretroviral preventive drugs to 80 per cent of HIV positive delivering women by the end of the initiative.

Between 1st October 2002 and 31st March 2004 the U.S. Government provided $143 for the initiative. From FY 2005 both the funding and activity for the Mother to Child Prevention Initiative have been included in PEPFAR.

Which countries are going to benefit from PEPFAR?

The Leadership Against HIV/AIDS Act of 2003 refers to funding relating to combating HIV/AIDS focusing on fourteen specific countries chosen by the President:

Botswana, Cote d'Ivoire, Ethiopia, Guyana, Haiti, Kenya, Mozambique, Namibia, Nigeria, Rwanda, South Africa, Tanzania, Uganda and Zambia.

These countries are usually now referred to as the "focus" countries. However, the Act of 2003 also says that the President may designate any other country in which the United States was implementing HIV/AIDS programmes in 2003.

Why are there now fifteen focus countries?

When Congress appropriated the funding for FY 2004, they required that a 15th focus country should be added, and that it should be outside of Africa and the Caribbean.¹³ Vietnam was added as an additional focus country in June 2004.

When reference is made to PEPFAR does this just mean the fifteen focus countries?

The acronym PEPFAR, or the longer name, the "President's Emergency Plan", are often used confusingly as though they refer solely to the focus countries. However PEPFAR and the President's Emergency Plan refer to all HIV/AIDS expenditure and activities that the U.S. government provides to all countries outside of the U.S.

An example of non-focus country PEPFAR expenditure is the substantial funding that is being provided for HIV/AIDS work in India.

What is the PEPFAR strategy document?

In February 2004 the President's Emergency Plan for AIDS Relief, U.S. Five-Year Global HIV/AIDS Strategy was published (hereafter called "the strategy document").¹⁴ Required by the Act of 2003, this document is the central policy document that interprets the provisions of the 2003 Act, and as Ambassador Tobias said at the start of the 100 page document,

"The plan reflects our current best thinking about what needs to be done and what we believe it is possible to do."

The strategy document has major sections on critical interventions on prevention, treatment and care in the focus countries. It also discusses centrally managed interventions that will be needed such as an effective and accountable supply chain, and a strong research programme to provide the necessary evidence base for the programmes.

PEPFAR targets and results

What are the goals of PEPFAR?

President Bush talked about the goals when he made the first announcement of PEPFAR.

"This comprehensive plan will prevent 7 million new AIDS infections [sic], treat at least 2 million people with life-extending drugs, and provide humane care for millions of people suffering from AIDS, and for children orphaned by AIDS."

Following on from this, Congress specified, in the Leadership Against HIV/AIDS Act of 2003, that the aims for the provision of antiretroviral treatment should be that:

1. by the end of FY 2004 at least 500,000 individuals with HIV/AIDS are receiving antiretroviral treatment through United States assistance programmes
2. by the end of FY 2005, at least 1,000,000 such individuals are receiving treatment
3. by the end of FY 2006, at least 2,000,000 such individuals are receiving treatment.

There was also in the Act the renewal of commitments on the prevention of mother-to-child transmission.

At the United Nations Special Session on HIV/AIDS in June 2001, the United States committed to the specific goals with respect to the prevention of mother-to-child transmission, including the goals of reducing the proportion of infants infected with HIV by 20 percent by the year 2005, and by 50 percent by the year 2010, as specified in the Declaration of Commitment on HIV/AIDS adopted by the United Nations General Assembly at the Special Session. The Leadership Against HIV/AIDS Act of 2003 reaffirmed this commitment, by specifying that PEPFAR should provide for meeting or exceeding the goal of reducing infant infections by 20% by 2005, and by 50% by 2010.

In June 2007 President Bush suggested a new set of targets for the end of 2013: to support treatment for nearly 2.5 million people, to prevent more than 12 million new infections, and to support care for 12 million people, including more than 5 million orphans and vulnerable children.¹⁵

What progress is being made towards these goals?

By July 2004 PEPFAR was supporting antiretroviral treatment for at least 24,900 HIV infected men, women and children in nine countries, which was a long way below the targets set by Congress in the 2003 Act. However, as Ambassador Tobias explained in his report on "Current Activities to Expand Treatment", the first money was not received from Congress until 23 January 2004, eight months after enactment, and full implementation of the programme did not start until June 2004.¹⁶ PEPFAR therefore set a new goal of reaching at least 200,000 people by June 2005.

It was next announced that PEPFAR had provided treatment to 155,000 people in the focus countries and an additional 17,000 in other countries by the end of September 2004.¹⁷ The focus country total had increased to 235,000 by the end of March 2005, meaning that the revised target for June 2005 had already been achieved, even though more than half of the national goals had not been met.¹⁸

By the end of September 2005, some 401,000 people were receiving treatment with PEPFAR support in the focus countries, and around 70,000 were benefiting in other countries through U.S. bilateral programmes.¹⁹

The focus country number rose to 822,000 by the end of September 2006, falling somewhat short of the one million target set by the 2003 Act.²⁰ By the end of September 2007, around 1.45 million people were receiving PEPFAR-supported treatment (compared to an original target of 2 million), of whom 94% were in the fifteen focus countries.²¹ Some countries have performed much better than others, and five have already exceeded the revised targets for the end of FY 2008 (see table below).

With regard to the targets on prevention of mother-to-child transmission, in FY 2004 around 125,500 women were provided with antiretroviral therapy to prevent infection of their unborn children, and as a result an estimated 23,700 infant infections were averted. The figures for FY 2005 were slightly lower and the target of a 20% reduction in infant infections was not met.²² The figures were much better in FY 2006, with around 285,600 pregnant women receiving the preventive drugs, improving again in 2007 with 294,000 pregnant women receiving the appropriate drugs. Over the four years PEPFAR estimates that it has helped to avert around 157,240 infant HIV infections.²³ Around 21% of HIV-positive, pregnant women in focus countries received antiretroviral drugs in FY 2006, up from 9% in FY 2004.²⁴

PEPFAR supported care for over 1.7 million people through March 2005, exceeding a goal of 1.1 million set for June 2005.²⁵ By the end of September 2007, this number had risen to nearly 6.7 million. The initiative has helped more than 2.7 million orphans and vulnerable children, and has supported over 30 million HIV counselling and testing sessions.²⁶

So far no estimates have been presented for the number of infections prevented by programmes focusing on sexual HIV transmission.

What are the treatment targets and numbers achieved by PEPFAR for individual focus countries?

The table below gives the treatment targets by country for FY 2008 (i.e. the end of September 2008), as well as giving the number provided with treatment by July 2004²⁷, September 2004²⁸, September 2005²⁹, September 2006³⁰ and September 2007³¹.

Country	Provided treatment by July 2004 (direct U.S. support)	Provided treatment by end September 2004	Receiving treatment end September 2005	Receiving treatment end September 2006	Receiving treatment end September 2007	Target for FY 2008
Botswana		32,839	37,300	67,500	90,500	33,000
Côte d'Ivoire	400	4,536	11,100	27,600	46,000	77,000
Ethiopia		9,500	16,200	40,000	81,800	210,000
Guyana		469	800	1,600	2,100	2,000
Haiti		2,829	4,300	8,000	12,900	25,000
Kenya	2,700	17,152	44,700	97,800	166,400	250,000
Mozambique		5,133	16,200	34,200	78,200	110,000
Namibia	2,500	4,000	14,300	26,300	43,700	23,000
Nigeria	500	13,579	28,500	67,100	126,400	350,000
Rwanda	100	4,386	15,900	30,000	44,400	50,000
South Africa	3,700	12,253	93,000	210,300	329,000	500,000
Tanzania	100	1,518	14,700	44,300	96,700	150,000
Uganda	7,300	33,000	67,500	89,200	106,000	60,000
Vietnam*		0	700	6,600	11,700	22,000
Zambia	1,500	13,636	36,000	71,500	122,700	120,000
Total	18,800	154,830	401,000	822,000	1,358,500	2,000,000

* Vietnam was designated a focus country on 23rd June 2004 and was not included in the reporting period to the end of September 2004.

These numbers refer only to people receiving antiretroviral treatment supported by PEPFAR (for data on the total number of people receiving treatment from all sources, see our treatment access table).

What do these numbers really mean?

There are a few issues worth bearing in mind when interpreting PEPFAR treatment figures.

In most cases PEPFAR provides only part of the support needed to enable people to access treatment. In particular, many thousands of people are on treatment supported by both PEPFAR and the Global Fund. In FY 2006 the Global Fund supported treatment for around 418,000 people in the fifteen focus countries, and the U.S. government believes that all of these people also received some support from PEPFAR. Therefore these people are counted by both organisations.³²

PEPFAR's numbers include not only those assisted through site-specific support of treatment centres, but also those supported by PEPFAR through contributions to national, regional or local "system strengthening" (including such activities as staff training, laboratory support, logistics, and curriculum development). Of the 822,000 referred to in September 2006, only 528,300 (64%) received direct, site-specific support.³³

In some countries such as Botswana, a small contribution to clinic costs by PEPFAR funds is resulting in all of the people attending certain clinics being credited to PEPFAR.³⁴ Some Botswanan health officials have argued that in fact zero patients in Botswana have been put on treatment because of PEPFAR.³⁵ It is unclear exactly how much PEPFAR needs to contribute to someone's treatment in order to include them in its treatment figures.

PEPFAR, the Global Fund, and indeed the WHO do seem to be attaching great importance to the number of people receiving antiretroviral treatment, and who is credited with achieving this. It is indeed excellent news that in countries such as Kenya and Zambia, an increasing number of people are receiving treatment. However, there also needs to be great importance paid to the quality of treatment, because if insufficient attention is given to such matters as adherence then not only will people die despite receiving treatment, but also a great deal of money will be wasted.

This sudden but very welcome increase in numbers may also obscure some of the real difficulties which exist with the scaling up of treatment.

What are some of the critical issues in the scaling up of treatment?

A number of major difficulties have been identified as hampering the efforts to expand antiretroviral treatment in the focus countries.³⁶ These difficulties include:

1. coordination difficulties amongst both U.S. and non U.S. agencies
2. U.S. government policy constraints
3. shortages of qualified focus country health workers
4. focus country government restraints
5. weak infrastructure, including data collection and reporting systems, and drug supply systems.

PEPFAR policies

What products can be purchased with PEPFAR money?

Several billion dollars of PEPFAR money is spent on the purchase of HIV antiretroviral drugs, and there are also significant purchases of a wide range of other supplies. These other supplies include such diverse items as soap and non-sterile gloves (for home care kits), laboratory equipment for CD4 counts, other laboratory supplies such as fridges, and breast-milk substitutes (for the prevention of mother-to-child transmission).

The strategy document specifies that all products purchased with Emergency AIDS Plan money must be "of the highest quality", and that "products will be procured from reliable manufacturers to ensure product safety and efficacy". But how is safety and efficacy to be confirmed?

Safety and efficacy for all pharmaceuticals purchased with PEPFAR money was subsequently explained as meaning that the drugs had to be approved by the U.S. Food and Drug Administration (FDA) or a regulatory agency in Canada, Japan or Western Europe.³⁷ It would not be sufficient for drugs to have been pre-qualified by the World Health Organisation, even though their system is trusted by most other donors and national governments.

How does this policy affect the purchase of generic drugs?

The strategy document says that drugs purchased with PEPFAR money may be "bioequivalent versions of branded ARV and other medications", meaning that lower priced generic drugs could be in theory be purchased. However, the requirement for approval by the FDA, or a similar regulatory body, initially excluded the purchase of most generics as most generic antiretrovirals were only pre-qualified by the WHO. The policy totally excluded the purchase of Fixed Dose Combinations (FDCs), none of which were approved by the FDA.³⁸

In May 2004 the FDA announced an accelerated review process for FDCs and generic drugs, and it was agreed by Ambassador Tobias that drugs approved through this process could then be purchased with PEPFAR money "where international patent agreements permit them to be purchased".³⁹ But although FDA approval can be provided in as little as six weeks after submission of an application, the first drugs received "tentative" FDA approval through this route only in December 2004.⁴⁰

By August 2005, nine generic drugs had won FDA approval. However none could be distributed by PEPFAR because several African countries refused to trust the FDA, and insisted the drugs be approved by the WHO before allowing them to be imported. To solve this unforeseen problem, FDA officials agreed to share with the WHO its files about the drugs, so that the WHO could quickly add them to its list of approved medicines.⁴¹ PEPFAR eventually began distributing generics towards the end of 2005, by which time 15 such drugs had been approved by the FDA, including two FDCs.⁴²

By December 2007 the FDA had approved 57 generic antiretroviral drugs, including eight FDCs and 14 paediatric formulations.⁴³ In FY 2006 generics accounted for only 27% of spending on drug procurement in focus countries,⁴⁴ but in FY 2007 some 73% of all antiretroviral drugs delivered by PEPFAR were generics.⁴⁵ Critics say that unnecessary bureaucracy has slowed the transition to using generics.⁴⁶

How important is it that generics and FDCs are made available through PEPFAR?

The inclusion of FDCs is potentially very important because of the beneficial effect FDCs have on adherence.^{47 48} FDCs are not only very important for developing countries but could also be very useful for some people in more developed countries such as the USA and UK.

Generic copies of AIDS drugs are usually cheaper than brand-name versions, so potentially enable more people to receive treatment. Purchasing generics in FY 2007 saved PEPFAR partners an estimated $64 million.⁴⁹

Is it proposed that a very significant amount of PEPFAR money be spent on "abstinence until marriage" and other HIV prevention work?

HIV prevention accounts for around 20% of total PEPFAR expenditure, and Congress has specified that at least a third of this money should be spent on abstinence until marriage programmes. This spending requirement has been the focus of considerable discussion; many people have questioned the effectiveness of promoting abstinence at the apparent expense of other initiatives such as the distribution of condoms.

In late 2005, PEPFAR introduced a new rule that at least two-thirds of all funds for preventing sexual transmission of HIV should be spent on promoting abstinence and being faithful (known as "AB" strategies). In countries with generalised epidemics (which includes most of Africa), the document says "a very strong justification is required to not meet the 66 percent AB requirement". All fifteen focus countries are expected to comply with the two-thirds rule.⁵⁰

The remaining one third of money for preventing sexual transmission is supposed to be spent on "condoms and related activities". According to PEPFAR's Third Annual Report, this includes not just condom distribution and promotion but also "mass media and community outreach programmes to promote avoidance of or reduction of HIV risk behavior" and "community mobilization for HIV testing".

Furthermore, PEPFAR requires that programmes that provide information about condom use must also teach the benefits of abstinence and partner reduction. And any programme that is not focused solely on promoting abstinence until marriage does not count towards the AB earmark. This means that, according to the rules, AB activities should receive much more than twice the resources committed to encouraging condom use.

In 2007 around 33% of all HIV prevention funds went to programmes that only promoted abstinence until marriage, as required by the congressional earmark. However an additional 25% was spent on "condoms and related activities", which means that AB-only programmes accounted for 57% of the budget for preventing sexual transmission, falling short of the 66% target.⁵¹ These were very similar to the results from 2006.

What condom programmes does PEPFAR fund?

The PEPFAR five-year strategy document mentions condom provision and promotion only for those who practice high-risk behaviours. Those who practice high-risk behaviours include "prostitutes, sexually active discordant couples [in which one partner is known to have HIV], substance abusers, and others". Condoms are not mentioned as a strategy for helping young people in general.⁵² This approach differs significantly from previous U.S. policy and the policies of other donors including the Global Fund and the European Union.

What are the effects of these prevention policies?

There have been some reports of organisations refusing U.S. funding because they believe condoms should be promoted beyond "high risk" groups. Such groups fear that PEPFAR's approach will lead to re-stigmatisation of condoms, and will promote the notion that condoms don't work as a form of HIV prevention.⁵³ However Dr Mark Dybul has claimed that,

"It is impossible for a site to be told to stop distributing condoms, or to close because of condom distribution... it would be directly contravening the stated policy of the U.S. government to say that because someone distributes condoms, they cannot receive resources from the U.S. government."

Dr Dybul has also insisted that,

"The notion that there's an excessive focus on abstinence is just untrue... The policy both in the guidance we issue and in the programs we support is fully ABC - abstain, be faithful, and correct and consistent use of condoms."⁵⁴

In April 2006, the Government Accountability Office (GAO) released the results of an extensive investigation of PEPFAR's policies for preventing sexual HIV transmission. Seventeen of the twenty country teams interviewed by the GAO said that fulfilling the spending requirements set by PEPFAR presented "challenges to their ability to respond to local prevention needs." Some said that they had had to scale down efforts to prevent mother-to-child transmission or to improve blood safety in order to try to meet the one-third AB requirement, and many said that not enough emphasis was being placed on condoms. In one country, the budget for outreach work with high-risk groups such as sex workers, sexually active youth and discordant couples was cut from $8 million to $4 million in order to meet AB requirements.⁵⁵

Moreover the official funding rules may not be the only constraints on the type of work that is carried out. According to one of PEPFAR's implementing partners in Nairobi:

"There are perceived restrictions in PEPFAR about what you can discuss with whom, so everyone is being very cautious... People are afraid to discuss family planning, condoms, abortion - so many groups don't address them at all."⁵⁶

This opinion is echoed by Canon Gideon, an HIV-positive Anglican minister from Uganda:

"The policy is making people fearful to talk comprehensively about HIV, because they think if they do, they will miss funding. Although they know the right things to say, they don't say them, because they fear that if you talk about condoms and other safe practices, you might not get access to this money."⁵⁷

Critics of PEPFAR's ABC policy

Following the GAO report, medical journal The Lancet published a full-page editorial calling PEPFAR's approach to preventing sexual HIV transmission "ill-informed and ideologically driven", and calling for "a complete reversal of policy". The editorial concluded that, "Many more lives will be saved if condom use is heavily promoted alongside messages to abstain and be faithful."⁵⁸ Other critics of the AB funding requirement include the HIV Medicine Association (HIVMA) and the Infectious Diseases Society of America (IDSA),⁵⁹ as well as a number of prominent American HIV prevention experts.^{60 61}

In a statement widely viewed as a criticism of PEPFAR policy, the European Union has said it is "profoundly concerned about the resurgence of partial or incomplete messages on HIV prevention which are not grounded in evidence and have limited effectiveness."⁶²

The PATHWAY bill proposed by Congresswoman Barbara Lee, and supported by many non-governmental organisations, would remove the one-third AB requirement, and also require the President and the Office of the Global AIDS Coordinator to establish a comprehensive and integrated HIV prevention strategy to address the vulnerabilities of women and girls to HIV infection.⁶³ This legislation has more than 75 local, state, and national endorsing organisations, including ActionAid International, the Elizabeth Glaser Pediatric AIDS Foundation and the International Planned Parenthood Foundation.⁶⁴

"We have been concerned for some time that the requirement to spend 33 percent of PEPFAR prevention funds on abstinence programs is limiting the ability of communities to respond to their most pressing needs—including prevention of mother-to-child transmission of HIV." - Elizabeth Glaser Pediatric AIDS Foundation, one of the main recipients of PEPFAR money.⁶⁵

Among other organisations calling for a repeal of the one-third AB rule is CARE, one of the world's largest private international humanitarian organisations. Dr Helene Gayle, President and Chief Executive Officer of CARE USA, has described the funding rule as “an arbitrary formula with no basis in public health evidence or practice.”⁶⁶

AVERT.org has more about PEPFAR's controversial approach to the ABC of HIV prevention, and how it might be affecting the AIDS epidemic in Uganda.

The Institute of Medicine report, 2007

The Leadership Act that created PEPFAR required the Institute of Medicine (IOM) to undertake a review of the initiative within three years of its inception. The report of this expert evaluation - published in March 2007 - contained a number of criticisms of PEPFAR policies and suggestions for improvement. To a large extent, these findings vindicated what many AIDS activists had been saying for some time:⁶⁷

• Inflexible budget allocations, including the one-third earmark for AB programmes, are harmful and should be removed.
• More effort is needed to empower women and girls and improve their status.
• PEPFAR should trust the WHO to prequalify drugs, and not require FDA approval, in order to increase use of generics.
• PEPFAR must transform from an emergency response into a long-term, sustainable programme - in particular by helping to expand the health workforce.

The IOM report was also sceptical about PEPFAR's support for abstinence-based prevention programmes, commenting that:

"There is ... little evidence to show that ABC when separated out into its components is as effective as the comprehensive approach."

In addition:

"Even as defined by PEPFAR, nearly everyone is a high-risk person in a generalized epidemic with high prevalence; thus most people need information about and access to all preventive methods, including condoms."

The Leadership Act requires that President Bush consider the conclusions of the IOM report. The report will undoubtedly influence debate as Congress prepares to reauthorise the global AIDS plan by late 2008.

Other funding restrictions

PEPFAR sets other funding restrictions that are not necessarily based on evidence of what is most effective in combatting HIV/AIDS.

The First Annual Report states that, "Emergency Plan funds will not support needle or syringe exchange".⁶⁸ Many people have objected to this because needle exchange programmes have been proven to help reduce the spread of blood-borne HIV by providing injecting drug users with sterile syringes, without encouraging drug use. In some areas, this may be part of a wider harm reduction strategy, whereby users are given a safe, monitored place to inject and/or pure uncontaminated drugs to reduce the risk of overdose. However, the U.S. government is opposed to such measures as it believes they make drug use seem more acceptable, and facilitate continued drug use.

The "Leadership" act of 2003 states that, "No funds made available to carry out this Act, or any amendment made by this Act, may be used to provide assistance to any group or organization that does not have a policy explicitly opposing prostitution and sex trafficking."⁶⁹ This condition (sometimes called the "Prostitution Loyalty Oath") led to Brazil refusing $40 million of PEPFAR funds in May 2005. The director of Brazil's HIV/AIDS programme explained, "Brazil has taken this decision in order to preserve its autonomy on issues related to HIV/AIDS as well as ethical and human rights principles". The Brazilian government and many organisations believed that adopting the PEPFAR condition would be a serious barrier to helping sex workers protect themselves and their clients from HIV.⁷⁰ In January 2006, the BBC World Service Trust abandoned a USAID-funded, multi-million-dollar AIDS awareness campaign in Tanzania because it refused to comply with this anti-prostitution clause. The Trust said it did not want to inhibit its ability to make television and radio programmes that discuss sex workers in a non-judgemental way.⁷¹ As a result Tanzania was left without any mass media programme to combat HIV.

Numerous non-governmental organisations and public health experts believe that the anti-prostitution clause is harmful and should be removed.^{72 73} Some have tried to challenge its legality under the First Amendment of the U.S. constitution, which guarantees the right to free speech. In May 2006, two American judges ruled in two separate cases that the clause did indeed violate the First Amendment and so could not be applied to the U.S.-based organisations that brought the cases, though all overseas groups wishing to receive U.S. Government funding, whether directly or indirectly, would still have to comply.⁷⁴ In February 2007 a higher court overturned one of these rulings.⁷⁵ It is therefore likely that the clause will continue to be imposed unless and until it is repealed by new legislation.

The "Global Gag Rule", also known as the "Mexico City Policy", denies U.S. international family planning funding to foreign non-governmental organisations that provide safe abortion services, counselling, referral, or information about safe abortion, advocate for changes in abortion law in their own country, conduct research on the effects of unsafe abortion, or otherwise work on safe abortion issues. In August 2003, President Bush released an Executive Order specifically exempting HIV/AIDS funds from restrictions under the Global Gag Rule. However, the restriction appeared twice in Kenya's $193 million Request for Application (RFA) for HIV/AIDS prevention, treatment and care, released by USAID in November 2005.⁷⁶ The inclusion seems to have been due to administrative error, and the document was later retracted. Nevertheless, there remains confusion about how the Global Gag Rule relates to HIV/AIDS funding, and some organisations may be denied funds as a result. Moreover, the policy is a significant obstacle to the integration of HIV prevention with reproductive health services.

In pursuit of rapid results, PEPFAR is in some cases taking over established projects that already had sufficient (though perhaps less generous) funding from other donors. In order to qualify for U.S. support, the organisations running such projects are compelled to sign documents setting out what activities they may and may not perform. Successful programmes may be terminated if they do not comply with PEPFAR conditions. Organisations that have previously relied on large amounts of U.S. money may have great difficulty securing alternative funding should they refuse to comply with the new "morality clauses".

Are there any other controversial areas?

Another controversial area has been the circumventing of the Global Fund to Fight AIDS, Tuberculosis and Malaria, by directing the bulk of resources to a separate initiative. However, the U.S. Government is still the largest contributor to the Global Fund.

The controversial areas of PEPFAR have at times overshadowed what has already been achieved, which is the channeling of hundreds of millions of newly appropriated funds to treatment programmes for tens of thousands of AIDS patients around the world.⁷⁷

"Since I started medication and I realized that I'm strong, I can do other things, my feelings are coming back. That's why I went back to school. What I was planning, I can now do it. So when you talk of PEPFAR, that's my life, because without it, I could have not lived." - John Robert Ongole, the first recipient of PEPFAR-supported antiretroviral treatment.⁷⁸

Distribution of PEPFAR funds

Which U.S. Government Agencies are involved in distributing the money?

The expenditure of money is coordinated by the Global AIDS Coordinator's office, but is distributed through a number of government agencies which include the U.S. Agency for International Development (USAID), the U.S. Department of Health and Human Services Health (HHS), the U.S. Department of Defense, the Department of Labor, the Peace Corps and the Census Bureau.

Within HHS a number of different agencies are involved including the Centers for Disease Control and Prevention (CDC), the Health Resource and Services Administration (HRSA), and the National Institute of Health (NIH). HHS manages the central funding for providing care and antiretroviral therapy for HIV positive people, and prevention activities through safe blood programmes. USAID manages the central funding for orphans and vulnerable children, for behaviour change through abstinence and being faithful, and for the Supply Chain Management System contract (see below).^{79 80}

How is money distributed?

Organisations and governments that receive PEPFAR money directly from a U.S. government agency are known as "prime" partners. Many of these prime partners in turn give grants to "subpartners" who help to implement PEPFAR's plans.

PEPFAR money is provided not only for country-managed programmes, but also through central funding mechanisms that fund regional initiatives serving more than one country. Examples of central programmes are the Abstinence and Be Faithful programme, the Blood Transfusion Safety programme and the Supply Chain Management programme. Such programmes provide central support for partners working in a number of countries.

How transparent is the distribution of funds?

During its first two years of operation (early 2004 until early 2006) PEPFAR published very little information about its activities and partner organisations. Some data were released by the Global AIDS Coordinator's Office, by USAID or by U.S. embassies, but it was impossible to track the flow of all PEPFAR money.

Although the situation has improved significantly since early 2006, PEPFAR continues to be cagey in its public relations. In November 2006, the International Consortium of Investigative Journalists (ICIJ) published the results of a yearlong investigation into PEPFAR, during which it had interviewed numerous U.S. government employees and recipients of PEPFAR funding.⁸¹ According to their report:

"During the investigation, reporters encountered PEPFAR officials who couldn't answer basic questions about the program they oversee, recipients of PEPFAR money who were reluctant to criticize their donor out of fear of losing funding and Freedom of Information Act requests that were stalled for months... Requests for interviews and information from OGAC's Washington office were often ignored; dozens of phone calls and emails were never returned... In several instances, organizations receiving PEPFAR money had to request clearance from the U.S. government before talking to reporters."

An executive of Family Health International - a leading recipient of PEPFAR funding - told the ICIJ that her organisation had stopped writing press releases to avoid official scrutiny. She said that the U.S. government "is constantly on the alert to any program that might draw attention or negative press."

Frustrated by such lack of transparency, the ICIJ took the State Department to court to try to gain access to their funding database. After a yearlong lawsuit, the State Department released a small portion of data relating to fiscal years 2004 and 2005. However, the ICIJ found that much of the information was too riddled with errors to be useful.

In terms of transparency, PEPFAR still has much scope for improvement.

AVERT.org has a page containing details of some of PEPFAR's partners and the projects for which they have received PEPFAR grants.

How were the five year focus country plans developed?

In 2003 the U.S. Global AIDS Coordinator asked the USAID Chief Of Mission in each country to undertake a strategic planning process to develop a five year plan for strengthening the quality, availability, and sustainability of treatment, prevention and care services.⁸² The planning process was to include all relevant U.S. Government entities, as well as the "host-country" government, the non-governmental sector, people living with AIDS, other bilateral and multilateral donors, and additional stakeholders.

These five year plans had to be submitted to the Global AIDS Coordinator for review, and final approval had to be given by the Coordinator to "ensure consistency with congressional intent, administration policy, and program objectives". Funding levels for the focus countries was to be allocated on the basis of the five year strategic plans. By the end of May 2004, fourteen focus countries had had their first year plans totalling $589 approved.

How much money is provided for each country?

The Third PEPFAR Annual Report gives the following figures for the funding for each focus country in FY 2004, FY 2005 and FY 2006.⁸³ AVERT.org has a page describing in more detail how funds are being allocated in PEPFAR focus countries.

Focus countries account for about half of PEPFAR's total budget, with the rest divided between the Global Fund, other bilateral programmes, and other activities (including research).

Country	FY 2004 ($ millions)	FY 2005 ($ millions)		FY 2006 ($ millions)
Botswana	24.3	51.8		54.9
Côte d'Ivoire	24.3	44.4		46.6
Ethiopia	48.1	83.7		123.0
Guyana	12.1	19.4		21.7
Haiti	28.0	51.8		55.6
Kenya	92.5	142.9		208.3
Mozambique	37.5	60.2		94.4
Namibia	24.5	42.5		57.3
Nigeria	70.9	110.3		163.6
Rwanda	39.2	56.9		72.1
South Africa	89.3	148.2		221.5
Tanzania	70.7	108.8		130.0
Uganda	90.8	148.4		169.9
Vietnam	17.4	27.6		34.1
Zambia	81.7	130.1		149.0
Total	751.3	1,227.0		1,602.0

How much money goes to indigenous organisations?

In FY 2004, PEPFAR had around 1,271 partners, of which 1,022 were indigenous (that is, based in the country in which they were working). Around 47% of all prime partners were indigenous, and 83% of subpartners. Indigenous prime partners received 22% of all money obligated to prime partners, and indigenous subpartners received 72% of all money obligated to subpartners.⁸⁴

In FY 2006, around 1,532 partners (83% of the total) were indigenous.⁸⁵

How many of PEPFAR's partners are faith-based?

In FY 2004, PEPFAR had 248 faith-based partners (16 primes and 232 subpartners), comprising just over 20% of all partners. PEPFAR views faith-based groups as priority local partners because many people participate in religious institutions, and they are important providers of health services in many focus countries.⁸⁶

In FY 2006, faith-based organisations comprised 23% of PEPFAR partners.⁸⁷

What is the New Partners Initiative?

This initiative will provide $200 million for HIV prevention and care grants to focus country organisations that have previously received little or no U.S. funding. The aim is to increase the number of PEPFAR partners and to "build local ownership of HIV/AIDS responses for the long term."⁸⁸ Critics point out that the initiative is likely to increase funding for Christian groups that are ideologically aligned with the Bush administration.

The first 22 recipients of funding under the New Partners Initiative were named in December 2006, a year after the initiative was announced. Although the New Partners Initiative was meant to increase support for local groups, eleven of the chosen organisations are based in the U.S., one is based in Norway, and only ten are indigenous. It appears that fifteen of the partners are faith-based organisations.⁸⁹

Another 14 new partners were announced in December 2007. Six of these are based in the U.S. or Europe, and six are faith-based organisations.⁹⁰

What is the Supply Chain Management System (SCMS) contract?

HIV/AIDS programmes require a large number of products, and as the strategy document explains effective supply management is critical to the delivery of these products. Any interruption to the supply of antiretroviral drugs can be literally life threatening, but there is also a need to avoid waste, and to address such issues as drug diversion and counterfeiting.

President Bush's AIDS Plan has the objective of providing an uninterrupted supply of high-quality, low cost products that flow through an accountable system, and in order to achieve this USAID decided to issue a contract to establish and operate:

"a safe, secure, reliable, and sustainable Supply Chain Management System (SCMS) to procure and distribute pharmaceuticals and other commodities needed to provide care and treatment of people with HIV/AIDS and related infections."⁹¹

The SCMS is designed to provide a one-stop shop for HIV/AIDS supplies and supply-related services for use by all HIV/AIDS programmes funded by President Bush's AIDS Plan.

After a number of delays, the contract was finally awarded in September 2005. The winning proposal was led by the Partnership for Supply Chain Management (PFSCM), a nonprofit organisation established by JSI Research & Training Institute (part of John Snow International) and Management Sciences for Health (see our PEPFAR partners page for more about these organisations). The contract funds up to $77 million in system operating expenses and technical assistance over the first three years. More than $500 million worth of drugs and supplies could be handled by the system during that time.⁹²

Since the SCMS began to operate in 2006 around $90 million worth of products have been delivered to 20 countries.⁹³ SCMS has secured lower prices for ARVs by purchasing generics wherever possible; in FY 2007 some 93% of drugs (by volume) delivered were generics.⁹⁴ The SCMS received $82 million in FY 2006 - more than any other PEPFAR partner.⁹⁵

The Ecumenical Pharmaceutical Network (EPN) - a consortium of over 70 health service providers and drug supply organisations from 29 countries - has expressed concern about the SCMS. In a May 2006 statement, the EPN said it fears that the system could destabilise existing, well-functioning supply chains, and that it may be unsustainable. It also criticised PEPFAR for not involving stakeholders from target countries when it designed the SCMS.⁹⁶

Has all the allocated money been spent?

There will often be some delay between the time when money is allocated to a prime partner and the time when that money is passed on to an in-country subpartner, such as a small community-based organisation. More time will then pass before the money is finally put to use. In some cases the whole process can take a considerable amount of time.

By early 2008, PEPFAR had obligated (promised to its partners) 94% of appropriated funds, and had outlayed 59% of them.⁹⁷

What's this?

WHERE NEXT?

AVERT.org has more about:

• The global AIDS epidemic
• What is PEPFAR doing in its focus countries?
• Which partners are receiving the most PEPFAR money?
• The Global Fund