Speaker: Dr Manica Balasegaram, Executive Director, MSF Access Campaign
The following is an update to our 25 July 2013 sign-on letter
Dear colleagues
Thank you for supporting the call from MSF asking Hain Lifescience to reconsider its price rise for the latest version of the GenoType MTBDRplus rapid diagnostic for multi-drug-resistant tuberculosis.
The strong, enthusiastic support from the TB community has already had an impact, leading to a meeting and productive discussions with Hain Lifescience to address the concerns with the pricing of Genotype® MTBDRplus version 2, as outlined in the letter. Attending the meeting was Mr David Hain and representatives from WHO, GDF, FIND and the MSF Access campaign.
The letter, signed by more than 50 organizations, was presented to Hain Lifescience during the meeting, which took place Friday, 2 August. The main outcomes of the meeting are summarised below.
• Agreement for increased transparency of the pricing structure for the MTBDRplus version 2 with publication of the breakdown of the bundled pricing. There is now a clearer pricing structure for MTBDRplus version 2.
Based on what was communicated during the meeting, the breakdown is as follows:
- EUR 3.30 per test for reagents and consumables (ex-works price), not inclusive of shipping costs; and
- EUR 4.20 per test for support and services fees.
• Clarification on what is to be included in the service and support fee, specifically - installation, training, after sales service, support, instrument maintenance (including calibration) and upgrades.
• Hain Lifescience has agreed to undergo a cost assessment for the MTBDRplus version 2 test to be carried out by an independent third party and paid for by UNITAID within their timeline as required. Additionally, the following points were also discussed with Hain Lifescience as follow on steps. Please note that not all these points have been fully agreed upon (e.g points 2 and 3).
- Hain Lifescience has offered to put back on the market the MTBDRplus test version 1 at the cost of EUR 3.30 per test without Taq Polymerase and not including service and support fees. The company¹s responsibility ends once the test is shipped to the user.
- Stakeholders and manufacturer have discussed the possibility to consider a decrease in overall cost for service and support linked to specific proficiency criteria for or the volumes used by the user laboratories. This has to be discussed and developed in a wider stakeholder meeting.
- Hain Lifescience remains reluctant to unbundle the service and support fees from the cost of version 2 of the test. Mr Hain is not convinced of the suggestion from MSF and others to slightly increase the price related to reagents and consumables (to EUR 4 per test) and to include the service and support fees into a yearly service contract, but he is open to further discussions on this point.
- Hain Lifescience has presented the overall volumes of the test currently purchased worldwide by organizations, governments and institutions for the public sector at FIND-negotiated prices. In order to reach the next price reduction of EUR 6.60 per test, the company requires a global annual volume of 750,000 tests to be procured. For 2013 such volume is expected to be short by approximately 150,000 tests. Partners of the EXPAND-TB project and other stakeholders will assess the different possibilities to increase the volumes of the tests currently procured.
- A stakeholders meeting will be organized by FIND (October 2013) to discuss the mid-term possibilities together with key stakeholders.
Overall the meeting resulted in progress in comparison to MSF and others¹ earlier meetings with the company and there is now a commitment to identify strategies that can adequately meet the needs of the different implementers. As there are still some unresolved issues, and the need to work on the detail of some of these proposals, we encourage the TB community to continue to monitor further developments.
FIND has agreed to organize a stakeholder meeting during the fall to discuss the possible mid-term solutions outlined above.
If you have further questions or comments regarding the outcomes of this meeting or the issues moving forward from MSF's point of view, please feel free to contact us.
In the meantime, we hope all manufacturers will make a positive move to become more transparent with pricing structures and follow 'best practices' regarding aggregating support and service costs into a one-off yearly service contract, rather than bundling such fees as part of the per test pricing.