US aid freeze sows disruption in HIV malaria product supply chains

LONDON - The US government’s foreign aid freeze has upended the supply chain for medical products crucial for fighting diseases including HIV and malaria in some of the world’s poorest countries, and life-threatening gaps could persist for months, according to two sources familiar with the sector.

The US Agency for International Development (USAid) usually places around US$600 million (S$801.9 million) of orders annually for products such as medicines, diagnostic tests and equipment like bed nets, as part of one of its biggest health supply contracts including HIV, malaria and reproductive health.

But the freeze has put orders and forecasts, particularly those made months in advance, on hold. That will likely have far-reaching implications for deliveries, cost, and timings, according to two sources with knowledge of the global health supply chain and others working in the sector.

Companies including the US firm Abbott, Switzerland’s Roche, and India’s Cipla are all likely to be affected, alongside others including Hologic, Viatris, Hetero and Aurobindo, the first of the sources told Reuters.

“We are monitoring the situation closely. Our highest priority is to ensure that patients have continuous access to our diagnostic tests and treatments around the world,” said a Roche spokesperson in response to Reuters’ questions. The other companies either declined to comment or did not respond. The US State Department did not immediately respond to requests for comment.

The first source said waivers from the US government, intended to allow lifesaving work to restart, only applied to orders already moving around the world. Even those were not fully functional as the USAid payment system remained down, he said. Future funding and orders were more uncertain, even for companies where the raw materials have been assembled or the manufacturing capacity booked, he added.

Medicines and diagnostic tests for HIV and malaria, as well