Foreign Affairs Committee on March 10th, 2015

[The Chair, Conservative, Dean Allison]

Good morning, everyone. Welcome to our meeting today. We have the opportunity to talk with the Global Fund to Fight AIDS, Tuberculosis and Malaria, and we have a couple of guests before us.

We have Christoph Benn, who is with the fund, and we also have Svend Robinson, who is probably no stranger to most of us around the room. Welcome, gentlemen. We're glad you could both be here.

I just want to talk a bit about the Global Fund and the fact that it was established in 2002. It does great work with AIDS, TB, and malaria. A lot of us know that. One of the things that make it particularly interesting with regard to how it works is the fact that the Global Fund insists on country ownership, which I think is great, and partnerships. It is performance-based and works with all sectors of society.

I know you guys are going to touch on this, but it begs repeating over and over again that the work that is done through the Global Fund is very exemplary.

The other thing that I know is that there was a pledging conference in 2013 with over $12 billion pledged, and since 2002 Canada has pledged and committed over $2.1 billion, if I am correct. That bears repeating. Our most recent pledge was around $650 million for the coming year, I believe.

There are a lot of organizations involved. Civil society is involved in how decisions are made, etc.

Why don't we just turn it over to you and you can give us an update on what's going on and some of the things that you're doing. Then we'll take some time to go around the room and ask questions and follow up on exactly what is happening with the Global Fund these days.

I'm going to turn it over to you guys.

[Dr. Christoph Benn, Director, External Relations, Global Fund To Fight AIDS, Tuberculosis and Malaria]

Thank you very much, honourable chairman, and all members of Parliament and of this committee.

It's always a special pleasure for me to be here with you. I've been able to talk to you several times and to update you on what's happening, not just in the Global Fund but also on global health in general. So I'm particularly pleased to be here with you this morning.

My first message is, indeed, one of great thanks to Canada, to its government, and also to you as parliamentarians for what you've been supporting over so many years now on global health.

Canada has shown extraordinary leadership in global health, both in maternal and child health. Canada has been well recognized for that over many years, through the G-7 summits and their commitment to mother and child health, and to the Global Fund and therefore to the fight against the major infectious diseases: AIDS, tuberculosis, and malaria.

Let me also point out again how closely these topics are related. Still today HIV, TB, and malaria are directly responsible for the deaths of 1.1 million women per year and 1.2 million children per year. There's a very close link between the international efforts to improve the health of women and children and the efforts we make in addressing the major infectious diseases.

In fact, you mentioned, Chair Allison, that we had this replenishment meeting in Washington, D.C., that delivered a little bit more than $12 billion for the three-year period of 2014 to 2016. That allows us to disperse about $4 billion per year. Roughly half of that goes directly into the health of women and children. This is just to emphasize this very close link.

I also want to thank you for the consistent support across all parties here in Canada for global health. I've always perceived this was very much a bipartisan issue supported by all of you, and I really want to thank you for that.

Therefore, let's look a little bit at what has been achieved with this extraordinary support from Canada over the last couple of years. This is the year the international community, represented by the United Nations, is reviewing the progress on the millennium development goals. We will have the big summit in September in New York. Therefore, it's important to take stock.

Child mortality has now gone down by 50% in just over the last decade. That is an extraordinary achievement that few of us working in the field would ever have thought possible. Similarly, maternal mortality has gone down also by about 50%. If we look at the three diseases—AIDS, tuberculosis, and malaria—we see decreases in infection rates and mortality also in the order of 40% to 50% across all these three diseases.

When the millennium development goals were established in 2000, it was perceived as a global emergency crisis. The numbers were going up and up. Six million people were dying from these diseases every year.

Now we're able to say that not only have we halted and reversed these trends, as was mandated by the MDG summit, but also we can really see that we have decreases of 50% and more. That means that we can also approach the phase where we can credibly talk about defeating these three diseases over the next 15 years or so once and for all as public health problems. This is an extraordinary achievement. I really hope that all of you who played an important role in this feel justifiably proud of what has been achieved with your support.

We should now build on that as we are already into a year that will be quite critical for international development. It's an extraordinary year, if we are looking at the big events coming up.

There is the financing for development conference in Addis Ababa in July that will set the scene for how the world will finance development over the next 15 years. Then there is the big summit with many heads of state, some say the biggest assembly of heads of state ever, in New York in September on sustainable development goals and how to chart out the course forward to defeat poverty over the next 15 years. Also, let's not forget that all of this is linked to climate change. We have the big conference in Paris in December on climate.

There is a very critical year ahead of us.

When I look at global health, I see particularly extraordinary opportunities beyond what I just said.

There has been a famous report in The Lancet that some of you might have seen. The big medical journal, The Lancet, commissioned a study that included really all the best brains in the world on public health and finance. They issued their Lancet report on global health by the year 2035, so they took a little longer-term perspective.

They called this report the “great convergence” because that's what it is about. We see now, after many decades when health indicators between the poorest countries and the richest countries were growing bigger and bigger...the gaps were getting bigger. Mortality was rising in the poorest countries where we had, in the wealthy countries, quite sophisticated health systems and life expectancy was going up. Now we see for the first time almost ever that this is approaching again, and that is fantastic news.

Last year the World Health Organization issued a report saying that life expectancy in the poorest countries, the low-income countries, has increased by nine years over the last 15 years. That's extraordinary, and there are many African countries where life expectancy was going down, particularly because of AIDS, and we were worried about the stability of these countries. Now the World Health Organization can report that in the poorest countries life expectancy has gone up by nine years. By the year 2030 we can credibly talk about approaching mortality rates for children and for adults where there will not be this big gap that we've seen so far.

That's not to say that the health systems will be at the same level. That's not possible, but you don't need these extraordinarily expensive and sophisticated health systems. What you need is very simple but affordable and highly effective interventions, which we now have, that will enable us to achieve this great convergence in health.

From the Global Fund's perspective, we are a financing institution and we make these resources available for countries in need so they can implement their programs on care, prevention, and treatment. But apart from the financial resources, we also look very much at efforts to make those programs more effective and to provide the kind of technical assistance and innovation that will drive these improvements.

Therefore, we've made innovation and the engagement of the private sector a key topic for the Global Fund for the next few years. That also matches quite well with the agenda of the Honourable Minister Paradis, who is also talking a lot about innovation and private sector engagement. In fact, I was with him on a panel at the World Economic Forum in Davos where we discussed that. There was a special edition of Global Health and Diplomacy that was issued, together with Canada, and we participated in that and published an article on how the Global Fund is including the private sector and innovation in that.

To that effect we've created what we call an innovation hub where we bring together many private sector companies from around the world, again, not to ask for their money but to ask for the particular innovation that they can provide, which if linked with the resources that we provide, will allow us so much more impact in the countries. We are looking at issues like improving the procurement and the supply chain management, the financial management, risk management, and the overall program quality. We already have a number of very good examples where leading international companies are working with the Global Fund to make these programs more effective and more accountable, by the way, so that we can really follow the investments and measure the results and the impact.

In that context we are also proposing what we call an e-marketplace. We want to, in a sense, innovate the whole way that countries procure essential drugs and health commodities to make it simpler, to make it more transparent, and to make it cheaper.

We have already, over the last two years, through innovations in procurement, saved about $300 million by purchasing bed nets, by purchasing AIDS drugs and malaria drugs, because we have a new way of procuring. In the future we are proposing an e-marketplace where those countries and their ministries or their NGOs can directly access online what kinds of commodities they need, what kinds of drugs they need, and access them at the best possible price and at guaranteed quality.

That cuts out a lot of middle agencies that increase the price and the complexity. This is not proposed just for the Global Fund. This is for all kinds of agencies that want to participate in that, including bilateral agencies, multilateral agencies, and other partners of the Global Fund.

That's one of the innovations that we are proposing and that we have been discussing with the Canadian ministry because we feel there might be a particular affinity. We would be very proud if Canada would pioneer some of that with us and communicate that with us in this very important development year.

You mentioned that the Global Fund is a key partnership where governments, private sector, and civil society come together at all levels—the global level and the country level. We strongly believe only that would be able to achieve these extraordinary results that we've seen and to achieve even more in the future.

Thank you very much for inviting us. We definitely are very happy to engage in any questions you might have.

[The Chair, Conservative, Dean Allison]

All right, thank you very much.

Mr. Robinson, you weren't going to say anything. You are part of the questions and answers. Perfect.

Mr. Dewar, why don't we start over with you, sir? You have seven minutes.

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you very much. I think in your overview, as Chair Allison said, the contributions that have been made, and the efficacy of the work that's been done in the Global Fund has been something that our country has been proud of. I think it's been a great example of where we worked together—all parties, multiparty—and previous governments worked together to support the Global Fund. That's mainly because of the approach and the way it was able to nail down some strategic goals and get funding, leverage funding and resources, in ways we haven't seen before with the understanding that no one government can do it and that not just government can do it, but working with civil society, the private sector, and others.

It is a good story to tell and I appreciate that fact that you've come here on an annual basis to brief us on what's happening. As Mr. Robinson will know, members of Parliament can get distracted on other issues. What's been a constant is bringing forward what the results have been for the Global Fund. We thank you for your overview of what's been happening, the good work that's been done, and the great results. We heard this from Mr. Bill Gates with regard to polio. Some positive things are happening.

I want to talk about TB. One of the Global Fund's supported programs is TB Reach. For those who don't know, it's the idea of being able to detect as well as treat—and that's clearly important, to be able to do both—in the most vulnerable areas, the hard-to-reach areas. The name says it all: TB Reach. In 2010 our government was a great partner in this. It made a five-year contribution of $120 million to the initiative. We're hearing...and I'm saying hearing. There are no facts on this and I'm hoping we can clarify it, but there is some question about that being renewed. For us to understand, as members of Parliament and this committee, what would be the consequences if Canada—and I hope it doesn't happen—didn't renew its contributions to that fund?

[Dr. Christoph Benn]

Thank you very much. That's an excellent question and provides me with the opportunity to talk a little bit about TB, which in some ways is the most neglected of the three diseases. I think there is much more public discussion on AIDS and on malaria.

TB Reach has been extremely important not just for the Global Fund, but for the international efforts to overcome tuberculosis. Let me tell you why. For tuberculosis, in principle, we have a curative treatment, which is fantastic. That's what we don't have for AIDS, but we have it for tuberculosis. There are challenges because there is increasing resistence to some of these standard treatments, but we know we have the drugs and we have the treatment. If it's followed it's a cure. The biggest problem with TB is to find who has active tuberculosis; the active case finding. That's the most important challenge. If we want to overcome tuberculosis it's that challenge. In vulnerable communities people often do not come forward to present themselves so they can be diagnosed and then treated. That's exactly what TB Reach does. It helps enormously with the identification of the patients so that they can then be followed up and treated.

Our great partners at the Stop TB Partnership call the biggest challenge the “missed” three million. We know every year there are three million people suffering from active tuberculosis who are not diagnosed. It's not that we could not pay for the treatment. They are simply not diagnosed. They are living somewhere in remote areas, in slum areas and in the big cities—Asia is a driver for this kind of tuberculosis—and TB Reach and the Stop TB Partnership are our key allies in addressing that particular aspect. We would be very grateful if the support for TB Reach could continue. It's very complementary. We pay for the diagnosis and treatment, and they help to reach the people. So full support for that and thank you for that important question.

[Paul Dewar, NDP, Ottawa Centre, ON]

I'm hoping that maybe our friends on the other side will let us know where we're at. We haven't heard whether the commitment is there, so we are obviously encouraging the government to follow up with a commitment to that important fund, as you said.

Right now, just give us an overview of what Canada's role is in the funding of this initiative. We are a principal player, are we not, in terms of TB Reach?

[Dr. Christoph Benn]

Yes, you definitely are.

I think Canada has a great history in its support of tuberculosis programs. I am quite aware that Canada has also played a leading role in the establishment of the Stop TB Partnership. I can't say what your share in TB Reach is, but I believe Canada has been a major donor and supporter of that, so your contribution would be absolutely critical.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Chair, finally, I note that after we've watched and witnessed Ebola and have been dealing with it, and this connects to TB, it's obviously about the medicines but we also have to have resilience in the health systems.

I want to finish my comments because the chair is going to pull the plug on me. We do understand that when we are funding these initiatives through the Global Fund, it's also about resilience in health systems, allowing people to get the diagnosis as well as the treatment.

Again, thank you to our witnesses.

[The Chair, Conservative, Dean Allison]

Thank you very much, Mr. Dewar.

We're going to move over to Ms. Brown for seven minutes, please.

[Lois Brown, Conservative, Newmarket—Aurora, ON]

Thank you very much.

It's good to see you here again. I think it's been maybe a year or a year and a half since we saw you last. It's good to have you here again.

You're right. Canada is doing great things. There was the $650 million that I announced in Washington a year and a half ago. We announced $500 million for the Gavi project. When you start to talk about convergence, it's all of these initiatives that we are seeing work hand-in-hand that are really going to make a difference globally: the reduction in maternal mortality, the reduction in infant mortality, and the number of children, as I said before, who are seeing five candles on their birthday cakes. They may not have birthday cakes, but it's that picture of seeing that number of children who are successfully growing and thriving which should be an encouragement to all of us.

As you well know, the Prime Minister made the announcement of $3.5 billion last May at the summit for reaching every woman and every child. That money is going to be disbursed from 2015 to 2020. All of the money that we have announced, the $2.85 billion that we announced in 2010, will be distributed by the end of this fiscal year. Canada has been very generous in its contributions. I think we are now starting to see the convergence of all these initiatives coming together: immunization, nutrition, and the new focus we have on vital statistics. Every one of those initiatives is going to help tremendously as we move forward.

I was really glad to hear you, Dr. Benn, talk about a new marketplace because I represent the riding of Newmarket—Aurora, and I always think that it's wise to reiterate that.

I was in Botswana a number of years ago, and I saw the allocation in their health budget to the initiatives for HIV/AIDS. Botswana is one of the countries that have been severely impacted. I understand that the life expectancy was 57 for males and 54 for females. They knew that they needed to address this with some money put there very specifically.

I wonder if you can tell the committee a little bit about how health systems are working with you at the Global Fund to start growing their own substantial health systems to address the issue. How do you work with them on a financial basis to see that happen?

[Dr. Christoph Benn]

Thank you very much, indeed.

It's great you're mentioning Botswana as an example, so let me take that and answer your question through that.

Botswana is one of the countries where I worked and advised hospitals before the Global Fund was created. In the years 2000 and 2001, Botswana had the highest HIV prevalence in the world, you will recall. Close to 40% of young adults were infected with HIV. It was an absolutely devastating situation. I was in some of the hospitals where we introduced the first antiretroviral treatment schemes, which were so urgent. At that time it wasn't even clear whether, under the conditions, they could be implemented. That was a year or two before the Global Fund was created.

Now Botswana has, indeed, made tremendous progress on HIV. It was one of the countries where the life expectancy had gone down to 35 years on average. As you mentioned quite rightly, it has now gone up again to 54 years among females. That's a tremendous achievement.

With the investment over the years, they have really scaled up their health systems. The hospitals are in a much better place now, and Botswana is a relatively wealthy country. It's an upper middle-income country. They no longer depend on Global Fund funding. We are not financing their treatment anymore. We have over the years, but they are now at a point where their health system can support that itself. I think that's a great achievement.

We do want to see that, over time, countries can graduate out of this international support, if possible. We see significant economic growth in many African countries. Botswana is just the leading example, I would say.

We've always believed in investments in the health systems while we invest in these three diseases. It was never a situation where we just delivered the drugs and then told them to take care of it. That does not work. Unless you have a workforce that is trained, unless you have hospitals with laboratories and outpatient and in-patient services, you cannot do that.

Let's talk about the prevention of mother to child transmissions, something that is very dear to Canada because of the Muskoka initiative. That requires good antenatal services for women, which they can attend, where they get tested, and where they receive overall antenatal care. If they prove to be HIV positive, they also receive treatment so their babies will be born without HIV.

That was an investment in the health systems, particularly in maternal and child health. That has really been going on. Billions have gone into these health systems through Gavi, through Global Fund, and through other initiatives.

There has been so much talk about Ebola, of course, over the last year. It was a very dramatic situation, and there was a lot of criticism that the international response was late. I do take that criticism, but we should also not forget many countries like Mali, Senegal, Nigeria, and others were able to prevent any outbreak. They had early cases, and the health systems were strong enough to prevent any further spread.

Now, we are grateful that Liberia, Sierra Leone, and Guinea also seem to be turning the corner. That is because there has also been significant investment in the health systems of these countries. Otherwise they would not have been able to cope.

There are good studies now that also show that investment in AIDS, tuberculosis, and malaria helped those countries to also address the challenges presented by new diseases, or other particular health challenges.

[The Chair, Conservative, Dean Allison]

Thank you.

That's all the time we have for this round. We are going to finish up this round and go to Mr. Garneau for seven minutes, please.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Thank you, Mr. Chair.

Thank you for your testimony.

You drew a very positive portrait of the Global Fund, which I was delighted to hear. I think we all support the work that is being done and the value of it. At the same time, it almost made me feel that I have no questions to ask because everything is going perfectly. However, in the real world nothing is ever perfect. So I'm going to ask you to reach down into the back of your mind and tell me if there is one thing that bothers you, that keeps you awake at night more than any other, with respect to possible areas of improvement for the Global Fund.

[Dr. Christoph Benn]

I can reassure you there are many things that keep me awake at night.

Also, I want to be clear. What I described was a very positive development globally, of which the Global Fund is a part. I did not claim that this was all just because of the work of the Global Fund. It is the work of an extraordinary movement over the last 15 years or so, which has made that possible, and we've been privileged to be part of that.

The challenges for the organization, if you're asking now about the functioning of the Global Fund as an organization, are still mainly the particular challenge of wanting to have a light touch. We are still an organization that has no country presence. We have no country offices in all these countries, and still we want to make sure that our investment is reaching the people.

There is a very high standard of accountability and often we cannot really follow that through from our headquarters in Geneva to the last mile, as we call it. It's not so difficult to reach the people in the capitals and the big hospitals. It's very difficult to reach the people in the rural areas, and that's where, in Africa, still most of the people live. So it's not only to make sure that the most vulnerable populations get their services, but also our donors, like yourselves, are expecting some level of accountability so that we can tell you how the money is being spent in those circumstances. That is not easy, unless we build up a huge machinery where we have our people everywhere.

We think we've found a way through engaging with partners at the local level, through engaging with what we call local fund agents, which we hire at the country level to report to us. That helps, but there is always this kind of dilemma of a global organization that has the mandate to have a light touch and keep the administrative costs down and still be accountable for the billions of dollars that we spend in many countries with very weak systems—not just health systems but financial systems.

That's our challenge, and that's, by the way, exactly where we want to engage the private sector. We are working now with several of the most well-known international banks and insurance companies to help us provide systems that provide a better oversight for these countries. They provide the teaching and financial accounting and risk management that we can apply at the global level. But if you go to Ghana, Uganda, and Sierra Leone, that's where they can be very helpful because they have the staff on the ground and they have the expertise and the technology that can help with that.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Thank you.

On a more specific level, there are a couple of things I'm curious about.

Are the medications that are used today to combat malaria, AIDS, and TB still at the brand pharmaceutical level, or are they generic? I'm curious about that. Also, where do most of them come from?

[Dr. Christoph Benn]

We have to differentiate among the three diseases.

For AIDS, where the biggest budget is in terms of antiretroviral drugs, we purchase 90% of those as generics and the bulk of that comes from India. India has a very vibrant generic industry of high quality, because it's not only the price; it's also the assured quality. Almost 90% of that we purchase in India, some from South Africa and other countries, but largely they're generic drugs.

When you come to tuberculosis, the first-line treatment is drugs that have been used for decades, so they are all off patent and therefore relatively cheap. We buy a complete course of TB treatment for six months. It costs about $50. That's generic drugs because there's no patent on these drugs. The challenge comes when we get to the more resistant forms. If we have to treat multidrug-resistant tuberculosis, then we have to go to new drugs that have been developed that are much more expensive and also more difficult to administer, and we have to buy them from research-based pharmaceutical companies.

For malaria, by the way, it's a mix. The artemisinin combination therapy is still under patent, but we get it at a largely reduced price. That's the tiered pricing that is coming in here.

It differs a little bit among the three diseases, but for the first-line treatment, we can buy them at very competitive prices, largely from generic producers.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

You mentioned that if we keep the pressure on for the next 15 years, possibly we can bring these three diseases really down to a very low level. Recently I read about a new strain of malaria that is supposedly challenging. I was wondering if that has upset the equation, if that presents a new and big challenge.

[Dr. Christoph Benn]

It's a challenge, but not one that would revise our predictions there. Malaria, among the three diseases, is probably the first candidate for elimination because so many countries are in the process of eliminating malaria. There are fantastic examples like Sri Lanka that had a big malaria problem and is now reporting for two years in a row no malaria death at all. It's a fantastic achievement. I could tell you similarly Eritrea, Vietnam, and other countries are on just that same path.

There is increasing resistance, and that is a concern. The resistance emerges usually in Southeast Asia, so it's the Mekong Delta, Cambodia, Myanmar, and Thailand—that area. We are investing specifically there. We have a special program of $100 million that is invested in the prevention of drug resistance because you need to strengthen the local authorities to detect and address that. We have a special program and we are working closely there with the Asian Development Bank and with the governments of those countries. It's a concern, but not so much that we would say, “This is becoming so overwhelming that we don't think we can make that progress”. Now we probably can. I would be surprised if Bill Gates didn't talk about this topic

I mean, there is a malaria vaccine on the horizon. It's more than on the horizon. It's likely to come out on the market maybe next year. It's not 100% effective, but it will be a very important additional tool. With that new vaccine and with the treatment that we have, we are still very confident that we can control malaria. Bill Gates is obviously investing a lot there as well, and he's even more optimistic. He speaks about eradication. We speak about elimination, which is slightly different, but in principle we can make enormous progress with the tools that we have and a few new tools coming onto the market now.

[The Chair, Conservative, Dean Allison]

Thank you.

We're going to have time for a second round. We're going to start with Mr. Hawn for five minutes.

[Laurie Hawn, Conservative, Edmonton Centre, AB]

Thank you, Mr. Chair.

Thank you both for being here.

Just following up on Mr. Garneau with the accountability systems in some of these countries and the billions of dollars we're talking about, obviously that's a pretty attractive sum. How much of a problem is financial corruption? Can you put a number on it grosso modo about how much is at risk of going in the wrong direction?

[Dr. Christoph Benn]

It is a problem for any kind of global donor investing money in these countries. I think all agencies, bilateral or multilateral like the Global Fund, have built up systems that enable us as much as possible to not only help them build the systems but also detect when something goes wrong.

We have auditors in all these countries. They are what I call the local fund agents. We also have an office of the inspector general who regularly orders investigations in these countries and issues reports, and we make those reports public. There are constant kinds of reports from our inspector general on our website so people can see where problems are being identified. We do find of course that there is mismanagement if we look carefully enough. If you're asking me a number, you know, if you add up the numbers from these repeated reports of the inspector general, you come to a number of about a 0.5% loss.

[Laurie Hawn, Conservative, Edmonton Centre, AB]

That's actually pretty small.

[Dr. Christoph Benn]

Yes, but it's significant money.

[Laurie Hawn, Conservative, Edmonton Centre, AB]

Yes, it is.

[Dr. Christoph Benn]

It's significant money, but you should also know that if we find that, we follow that. In every single case we go after them and tell them that they have to repay it. That's what we call the recovery, so if you identify that loss, it doesn't mean that we just write it off. We ask them to repay.