Study on Reinforcement Project of Blood Service in the Republic of Uzbekistan

Study on Economic Partnership Projects in Developing Countries in FY2016

February 2017

Prepared for: Ministry of Economy, Trade and Industry

Prepared by: Shimizu Corporation

Reproduction Prohibited

inthe Republicof Uzbekistan Studyon Studyon Economic Partnership Projects in Developing Countriesin FY2016

ReinforcementProject of Blood Service

February

2017

Ministryof

Preparedby:

ShimizCotporation

Economy, Trade Industry and

Preface

This report summarizes the results of the “FY2016 Project for Promotion of Overseas Deployment of High-Quality Infrastructure Systems (Investigation of Yen-Loan-Financed Private-Sector Infrastructure Project Formation),” which was entrusted to Shimizu Corporation by the Ministry of Economy, Trade and Industry (METI).

This study “Republic of Uzbekistan: Study on Reinforcement Project of Blood Service in the Republic of Uzbekistan” was conducted to verify the feasibility of a project aiming to improve Uzbekistan’s blood services by developing a new plasma product factory in its capital, Tashkent City, upgrading test equipment of blood centers located in 4 major cities, including Tashkent City, and providing operational support and technology support for those facilities at a cost of approx. 8.05 billion JPY.

We hope that this report will help the above project to be realized and serve as a reference for the stakeholders in Japan.

February 2017

Shimizu Corporation

Project Map

Project sites across the country

(1)

(2)

(5) (10) (4) (3) (7) (9) (6) (8)

(11)

(12) 100 km

Provincial Blood Station (1) Nukus Provincial Blood Station Karakalpakstan Nukus City (2) Urgench Provincial Blood Station Khorezm Urgench City (3) Fergana Provincial Blood Station Ferghana City (4) Andizhan Provincial Blood Station Andijan City (5) Namangan Provincial Blood Station Namangan City (6) Bukhara Provincial Blood Station Bukhara City (7) Navoi Provincial Blood Station Navoiy City (8) Samarkand Provincial Blood Station Samarkand City (9) Jizzax Provincial Blood Station Djizakh City (10) SyrDarya Provincial Blood Station Syrdarya City (11) Kalush Provincial Blood Station Kashkadarya Karshi City (12) Termez Provincial Blood Station Surkhandarya Termez City Gray-shaded stations (1, 4, and 8) are target sites of the project.

Source: A map image from Google Maps was modified by the study team Project sites across Tashkent Province (2)

(6) Tashkent (3)

(4) (5) (1)

2 km

(7) Chirchik

Tashkent 5 km

Plasma product factory Within the premise of the Republican Blood (1) Existing plasma product factory Transfusion Center in Tashkent City Blood transfusion stations in Tashkent Province (1) Republican Blood Transfusion Center (2) Blood transfusion station in the 2-clinic of Tashkent Medical Academy (3) Blood transfusion station in the 3-clinic of Tashkent Medical Academy Tashkent City (4) Blood transfusion station in the Republican Scientific Center of Surgery (5) Blood transfusion station in the Republican Scientific Center of Emergency (6) PNN Blood Product Center (7) Chirchik Chirchik Blood Transfusion Station The gray-shaded station (1) is a target site of the project. Source: A map image from Google Maps was modified by the study team Abbreviations

Abb. Complete designations B/C Benefit per Cost BCP Business Continuity Plan CLEIA Chemiluminesent Enzyme Immunoassay EIA Environmental Impact Assessment ELISA Enzyme-Linked ImmunoSorbent Assay E/N Exchange of Notes FIRR Financial Internal Rate of Return F/S Feasibility Study GDP Gross Domestic Product GMP Good Manufacturing Practice HBV Hepatitis B Virus HCV Hepatitis C Virus HIV Human Immunodeficiency Virus IU International Unit JB Japan Blood Products Organization JBIC Japan Bank for International Cooperation JETRO Japan External Trade Organization JICA Japan International Cooperation Agency JPY Japanese Yen L/A Loan Agreement ME Medical Equipment METI Ministry of Economy, Trade and Industry MOH Ministry of Health NAT Nucleic acid Amplification Test NPV Net Present Value ODA Official Development Assistance QA Quality Assurance QC Quality Control SanPiN Sanitary Norms and Regulations STEP Special Terms for Economic Partnership USD United States Dollar UPS Uninterruptible Power Supply WHO World Health Organization

Contents

Preface Project Map Abbreviations Contents

Executive Summary

Chapter 1 Overview of the Host Country and Sector (1) Economic and Financial Circumstances of the Counterpart Country ...... 1-1 1) General Background of Uzbekistan ...... 1-1 2) Uzbek Economic and Financial Circumstances ...... 1-2 (2) Overview of Project Target Sector ...... 1-6 1) Overview of Blood Services in Uzbekistan ...... 1-7 2) Status of blood donation ...... 1-9 3) Status of plasma derivative production ...... 1-10 4) Conditions of Major Institutes ...... 1-11 5) Issues Related to Blood Services ...... 1-16 6) Overview and Comparison of Current Status of Blood Services in Japan ...... 1-17 (3) Conditions of Target Areas ...... 1-21

Chapter 2 Study Methodology (1) Study Details ...... 2-1 1) Study Items ...... 2-1 2) Study Targets ...... 2-2 (2) Study Methodology and Organization ...... 2-2 1) Study Methodology ...... 2-2 2) Study Organization ...... 2-3 (3) Study Schedule ...... 2-5 1) Overall Schedule ...... 2-5 2) Field Studies ...... 2-5

Chapter 3 Justification, Objectives and Technical Feasibility of the Project (1) Project Background and Significance ...... 3-1 1) Project Background ...... 3-1 2) Project Significance ...... 3-1 (2) Basic Policies and the Determination of Project Details ...... 3-3 (3) Project Overview...... 3-4 1) Improvement of blood services: securing of raw material plasma required for production of sufficient blood products ...... 3-4 2) Improvement of blood services: increased blood safety ...... 3-5 3) Increase of safe and secure plasma derivatives production ...... 3-6 4) Operational Support for Human Resource Development, Training and Equipment Maintenance etc...... 3-10 5) Project Cost Estimate ...... 3-11 (4) Necessary Evaluation of the Project ...... 3-12 1) Demand Forecast ...... 3-12 2) Consideration of Division of Roles for Implementing of the Project ...... 3-12 3) Evaluation of Technological Practices for Plasma Derivative Production ...... 3-12 4) Acquisition of Approval and Licenses Required for Plasma Product Factory Construction 3-13

Chapter 4 Evaluation of Environmental and Social Impacts (1) Analysis of Current Environmental and Social Situations ...... 4-1 1) Current Status of the Land for a New Plasma Product Factory ...... 4-1 2) Current Status of Blood Centers ...... 4-1 (2) Positive Environmental Impact of the Project...... 4-2 (3) Environmental and Social Impact of the Project ...... 4-2 1) Impact on Ambient Natural Environment ...... 4-2 2) Impact on Social Environment ...... 4-2 (4) Overview of Environmental and Social Impact Related Laws and Regulations of the Host Country and Actions Required for Compliance ...... 4-4 1) Uzbek Laws and Regulations Related to Environmental and Social Impact ...... 4-4 (5) Necessary Actions of the Host Country for Realization of the Project ...... 4-4

Chapter 5 Financial and Economic Evaluation (1) Project Cost Estimate ...... 5-1 1) New Plasma Product Factory ...... 5-1 2) Blood Centers ...... 5-1 3) Total Project Cost ...... 5-2 (2) Summary of Preliminary Financial and Economic Analysis Results ...... 5-2 1) Financial Analysis ...... 5-2 2) Economic Analysis ...... 5-11

Chapter 6 Planned Project Schedule ...... 6-1 (1) Overall Schedule ...... 6-1 1) Split of Project Scope ...... 6-1 2) Implementation Schedule ...... 6-1

Chapter 7 Implementing Organization ...... 7-1 (1) Overview of Implementing Organization in the Host Country ...... 7-1 1) Overview of Implementing Organization ...... 7-1 2) Chart of Implementing Organization ...... 7-1 (2) Host Country’s Organization for Project Implementation ...... 7-2 1) Supervising Organization (MOH) ...... 7-2 2) Implementing Organization (Republican Blood Transfusion Center) ...... 7-2

Chapter 8 Technical Advantages of Japanese Companies ...... 8-1 (1) The International Competitiveness of Japanese Companies and the Possibility of Winning Contracts in the Proposed Project ...... 8-1 1) Entire Blood Services ...... 8-1 2) Provision of Facilities and Equipment by Japanese Companies ...... 8-1 3) Expectations of the Host Country Government ...... 8-1 (2) Japanese Materials and Equipment, and their Prices ...... 8-1 1) New Plasma Product Factory ...... 8-1 2) Blood Centers ...... 8-4 (3) Measures Required to Help Japanese Companies Win Contracts ...... 8-4 1) Provision of Maintenance and Technological Support in Yen-Loan Package ...... 8-4 2) Evaluation of STEP Conditions ...... 8-5

Executive Summary

(1) Project Background and Significance

WHO recommends countries to domestically produce blood products for transfusion and plasma derivatives in domestic formulation plants from human blood collected domestically. Following these recommendations, Uzbekistan has been striving to establish self-sufficiency in their blood product supply. In June 2015, the country formulated the “Complex Plan for Improvement of Blood Services in Republic of Uzbekistan” for the deliberation of appropriate measures. According to the plan, the country’s population is expected to reach 40 million by 2035, and this will necessitate (1) 4,000L albumin, (2) 240,000 doses of immune globulin, and (3) 8,200 doses of cryoprecipitate per year.

Although Uzbekistan has developed and operated blood centers and a plasma product factory under supervision of MOH, many of them were constructed in the 1970’s and are not sufficient in both quality and quantity. For example, Uzbek production capacity of albumin is as small as 600L annually, which falls far short of the 3,000L of the annual required amount for today’s population of 30 million. The shortfall is currently filled by imports and this may possibly lead to an unstable supply depending on the country’s financial circumstances and the climates of exporting countries.

In 2015, MOH of Uzbekistan contacted stakeholders in Japan and explored possibilities of improving and rebuilding of existing old and aged blood-service facilities and poor plasma derivative production functions of the country with support from Japanese government. An Uzbek presidential order (No.4639) regarding economic corporation campaign was then issued by then President Karimov in the subsequent year 2016, which dictated the promotion of construction of a new plasma product factory with the support of Japan as part of the aforementioned complex plan for blood services improvement. This study was conducted in order to verify the project scope, targets, and scale for a feasibility study of the project.

(2) Principles of Project Contents Determination

In line with the reference from MOH of Uzbekistan and the Presidential Order of the former President Karimov, the objectives of this project are: to ensure blood products for transfusion and plasma derivatives are supplied to more Uzbek patients in need through an improvement of its blood services and development of a plasma product factory; and to reduce the country’s financial burden by reducing the imports of expensive blood products.

In order to achieve the objectives, present issues in Uzbekistan were revealed and the following policies were set through preliminary studies. Integrated support provided through the project include not only facilities, equipment and devices etc. on the hardware side, but also Japanese-style operation procedures, maintenance and human resource development practices on the software side.

Basic policies of the project 1． Improvement of blood services: securing of raw material plasma required for the production of adequate blood products To secure donated blood required for producing the target amount of plasma derivatives, support for the introduction of essential equipment and guidance and instructions on the promotion of blood donation and processing of increased amounts of donated blood will be provided.

2． Improvement of blood services: increased blood safety Support for the introduction of essential equipment to reduce the risk of infection through transfusion and improve blood product safety, and training for new procedures associated with new equipment will be provided.

3． Increase of safe plasma derivatives production Construction of a new plasma product factory, introduction of modern equipment, and production expansion of safe plasma derivatives conforming to international standards will be conducted. After completion of a new factory, reagents and consumables will be provided with support for equipment maintenance until factory operations are fully under way.

4． Operational support for human resource development, training and equipment maintenance etc. at the plasma product factory Besides hardware assistance (facilities and equipment), Japanese-style management and know-how will be introduced to improve production efficiency and quality.

S-1 (3) Project Overview

1) Improvement of blood services: securing of raw material plasma required for production of sufficient blood products Possible measures to increase the number of non-remunerated blood donors and to process an increased volume of donated blood are as follows. a) Activities to promote blood donations In order to increase the volume of donated blood, national efforts and increased awareness of blood donations among the nationals are critical. Listed below are the possible measures to achieve this. 1. Activities to promote blood donations through education institutions 2. Distribution of information materials in video, poster and other formats to various strata of the country 3. Media promotion activities b) Blood collection, testing, production and supply Equipment and manpower to process an increased volume of donated blood will be necessary in the future. 1. Blood collection: bloodmobiles, donation rooms and whole blood collection devices 2. Testing: blood cell counters, full-auto blood grouping equipment and infection testers (NAT, etc.) 3. Production (blood products for transfusion): automated production equipment 4. Supply: cooling containers

The proposed project will provide support on the introduction of equipment associated with the above items, as well as guidance on blood donation promotion activities and human resource development etc. on the software side. The support on the software side will be provided for 4 years from equipment introduction, and support measures to enable Uzbek bodies to independently promote blood donations and manage their blood service operations will also be implemented during the period.

2) Improvement of blood services: increased blood safety To secure fresh frozen plasma from which to produce blood products for transfusion and plasma derivatives with low risk of HBV, HCV and HIV infection, infection testing equipment including NAT will be introduced. The proposed project will also distribute reagents and consumables required for testing equipment for 4 years beginning from the introduction of equipment.

3) Increase of safe and secure plasma derivatives production A new plasma product factory will be constructed in the premises of the existing blood center and new production equipment will be procured and installed in the new factory. The building will be two stories, with a gross floor area of approximately 3,600m2. It will be located behind the blood center building and a linked corridor will be provided to connect with the blood center building. The room layout will be arranged based on circulation planning for the efficient production flow from the reception and storage of fresh frozen plasma (raw material), to production, testing, packing and shipment. Production processes will be performed in clean rooms, which are classified into primary through tertiary zones depending on their cleanliness levels. A pharmaceutical water plant, a generator room and a boiler room will also be included in the new factory building.

4) Operational Support for Human Resource Development, Training and Equipment Maintenance etc. a) Improvement of blood services: securing of required volume of raw material plasma To solicit for new donors and further cooperation from past donors, guidance on promotional activities through education institutions and various media. The proposed project will proceed with nation-wide promotional activities in cooperation with the Uzbekistan Red Crescent, which has already conducted blood donation promotional activities in Uzbekistan.

Along with the deployment of new blood collection devices and analysis equipment at blood centers, guidance on test management and new procedures will also be necessary.

S-2 human resource development practices are important. In blood collection practices, management of blood collection standards, interviews, and donors (identity check) is critical, while sample storage and look-back studies are after blood collection. Guidance by Japanese experts on these matters is included in the project scope. c) Plasma product factory As the new factory will adopt a mass-production system with new production equipment, it will be necessary to define staff organization and a division of roles, and implement training measures to familiarize staff with new procedures. Compliance with internationally accepted standards, i.e., GMP (Good Manufacturing Practices), is also essential to ensure exportable quality of plasma derivatives. Thus, experts will be dispatched from Japan to develop human resources and provide guidance on maintenance systems, facility operations and production practices for 4 years after completion of the new factory.

5) Project Cost Estimate As shown in the following table, 26,248,703 USD for reinforcement of blood services, 42,327,335 USD for construction of a new plasma product factory, and 68,576,038 USD (approx. 8.05 billion JPY) for total project cost are estimated.

Table S-1 Breakdown of Estimated Project Cost for Reinforcement of Blood Services

3 Dispatch of Japanese experts (blood donation promotion, test management, technological instruction, management guidance, human resource development and training etc.) 2,415,190 USD 4 years after equipment introduction: about 219 experts per month in total Total 26,248,703 USD

Source: Study team

Table S-2 Breakdown of Estimated Project Cost Plasma Product Factory Construction 1 Factory building construction work Gross floor area: 3,600m2; RC structure; two-story Including building equipment (boiler, compressor, generator, transformer, A/C, piping and valves etc.) 19,800,000 USD 2 Plasma product factory Various tanks, heat exchangers, pharmaceutical water equipment, freeze-drying machines, centrifugal separators, autoclaves, serial dispensing machines, control systems and instrumentation etc. 14,478,745 USD

S-3 3 Consumables and maintenance work for 4 years after completion 1,751,841 USD 4 Japanese expert dispatch (blood donation promotion, test management, technological instruction, management guidance, human resource development and training etc.) 6,296,749 USD 4 years after completion: 84 experts per month in total Total 42,327,335 USD 1 USD = 117.382 JPY (as per JICA’s settlement rate for FY2016 (as of January 2017))

Source: Study team

3) Summary of Preliminary Financial and Economic Analysis Results a) Financial analysis Conditions for financial analysis were determined as follows:  Life of buildings and equipment shall be assumed to be 40 years and 20 years, respectively; equipment shall be renewed after 20 years after implementation.  No salvage value for both buildings and equipment shall be considered.  The analysis period shall be 40 years.  1% of building price and 5% of equipment price shall be accounted as maintenance and management expenses every year from the second year after the project implementation.

In addition to the above conditions, three cases of plasma derivative pricing were simulated and results were compared.  Case 1: Benefits were calculated based on the local price of plasma derivatives at the time of this study. As a result, the project would not run on an economic basis due to the low unit price.  Case 2: Benefit was calculated based on the latest price of plasma derivatives published by the Ministry of Health, which is higher than that of Case 1. The project would be profitable based on the latest MOH price for derivatives, with B/C rated as 1.508.  Case 3: On the assumption that production of plasma derivatives could not reach the target volume, the benefit was calculated as 85% of the target production volume. The project would be sufficiently profitable despite lower NPV and B/C.

Table S-3 Financial Analysis Results In 1,000 USD Case 1 Case 2 Case 3 Operational cost All paid All paid All paid distribution Grant for staff compensation, etc, Yes Yes Yes from MOH Basis of plasma Local price at the time Latest MOH Latest MOH derivative pricing of the first local study price price NPV -45,319 64,941 45,368 B/C 0.659 1.500 1.350 FIRR − − − Source: Study team

S-4 b) Economic analysis There are the following four potential economic benefits of the proposed project.

Table S-4 Potential Economic Benefits of the Proposed Project

No. Type of benefit Measurement 1 Production of sufficient amount of plasma ・ Increase of produced plasma derivatives will eliminate the importing cost derivatives arising out of the heavy dependence on ・ Decrease or elimination of imports. Domestic sales volume will also imports increase. 2 Surplus plasma derivatives produced ・ Exports of plasma derivatives domestically can be exported to neighboring countries. 3 Deployment of bloodmobiles is expected to ・ Increase of donated blood lead to a significant increase in the amount of ・ Increase of plasma derivative donated blood. production thanks the securing of more plasma (a raw material of plasma derivatives) 4 Transfused patients’ risk of infection will be ・ Reduction of risk of infection substantially reduced by introduction of established blood test systems.

Source: Study team

Increase of plasma derivatives and plasma described in No.1 and No.3 above is the effect of pricing relative to the derivative production volume as discussed in relation to the financial analysis.

The benefit No.4 can only be accessed qualitatively based on the reduction of infection risk as data regarding infection cases after dosing of plasma derivatives are not available.

The benefit No.2 is the potential benefit from the possibility of exporting plasma derivatives when domestic demands are fully met. This benefit is examined below.

Conditions for estimating the economic benefit are the same as those in the financial analysis.

With the plasma derivative production volume expected to exceed the current imported albumin volume of 1,100L by 2020, the annual imports amounting to approximately 100 million JPY will be eliminated and even income from exporting can be expected. The required volume of plasma derivatives for the Uzbek population is indicated in the table below based on WHO’s recommendation per 1 million.

Table S-5 WHO’s Recommended Volume of Plasma Derivatives (per 1 million)

WHO’s recommended volume (per 1 million population) Derivatives 10% albumin (L) 10% immune globulin (dose) Blood coagulation 1 dose = 3ml factor VIII (unit) Required 100L 6000 doses 1,000,000 units volume

Source: WHO

Based on the above figures, the possible surplus and exports were calculated. The calculated profit from exporting was considered as the income in Case 2. Then a cash flow table was developed and the NPV and B/C figures were calculated. The results of this calculation were -28,805 USD for NPV and 0.777 for B/C; NPV is negative, but the B/C value indicates that the export income would account for about 51% of the total income in Case 2. Thus, the benefit from plasma derivative exporting is expected to deliver significant positive effects on the Uzbek economy.

S-5

3) Evaluation of Environmental and Social Impacts With MOH’s approval already obtained, the premises of the Republican Blood Transfusion Center where there is an existing plasma product factory was determined as a site for the new plasma product factory. For this project, therefore, there will be no need for securing a new factory site and for the relocation or resettlement of the existing commercial facilities or residents.

For the traffic of the construction vehicles and the bringing in of construction materials/equipment for the implementing of the project, a part of the existing blood center operations must be limited during the construction period. For the same reason, safety, anti-contamination, anti-noise and anti-vibration measures etc. are required in and around the premise of the Republican Blood Transfusion Center in order to minimize the impact on the environment.

Although any plasma product factory requires special attention for the disposal of wastes including effluents, there are no specific standards regarding effluent treatment in Uzbekistan. Therefore, the currently-applied SanPiN standards should also apply to the new factory. Appropriate measures against construction noise, etc. should also be implemented.

For the blood centers’ part of this project, there will be no environmental and social impact because the project scope is limited to the procurement of additional equipment to existing facilities.

(4) Technical Advantages of Japanese Companies

Plasma derivative production techniques to be introduced to Uzbekistan through the proposed project are elementary techniques for which there are no significant differences in technical competencies among advanced nations including Japan. Similarly, equipment used in the production processes and construction techniques for clean rooms required for GMP compliance are very common among many countries and companies in Europe and other parts of the world. In other words, Japan and Japanese companies have no particular advantages in this field.

On the other hand, Japan’s blood services are known for the world’s highest level of safety and quality. Also, in Japan there is great public trust in blood services developed through blood donation campaigns promoted by local administrations and private businesses, which has led to a high rate of blood donation. Thus, Japan’s strengths lie in thorough quality control excellent enough to maintain this trust and consistent supply of highly efficient and safe blood products to the public.

In other words, Japan’s strengths in blood services are comprised of the collective competencies of its entire blood service system covering upstream processes, including blood collection, backed by excellent quality control know-how and the professional ethics of experts.

It is not easy to point out the objective and quantitative measurements of the abstract competitiveness of Japan’s techniques and know-how. However, including the transfer of such techniques and the know-how in the scope of this project, it will likely increase the chance for Japanese companies to receive orders. Additionally, the smooth transfer of techniques and know-how from Japanese technicians, the introduction of reliable equipment familiar to them would be prioritized and this could also increase the chance of increasing the exposure of the products of Japanese manufacturers.

Moreover, this project originates from the presidential order of the ex-President Karimov (No. 4639, issued on April 19, 2016), in which a Japan-Uzbekistan project was envisioned as part of the economic cooperation between the countries. The Uzbek deep trust in Japanese products and technical competencies built through past economic activities between Japan and Uzbekistan must be the primary reason of designating Japan in the order statement. Considering the background of project formation, Uzbekistan primarily seeks Japan’s participation in the project and it is likely that Japan can take the initiative in this project when other conditions are met.

S-6 (5) Concrete Schedule before Project Realization and Possible Obstacles

1) Schedule before Project Realization Expected implementation schedule is as follows. After completion of this study, Uzbekistan government will proceed with its internal decision making processes and submit a request letter to the Japanese Government. Then, a preparatory survey will be conducted by JICA before confirmation of the project. Following the execution of E/N and L/A based on the survey results, a consultant to support the implementation will be appointed and the detailed design will be completed in about 7 months subsequently. Contractors for facility development and equipment procurement will then be selected and equipment installation and operation instructions will be provided upon completion of the construction after 18 months. Technical guidance, human resource training and consumable supplies will also be provided in 4 years and then the project will be completed.

Figure S-1 Implementation Schedule Year1 Year2 Year3 Year4 Year5 Year5 Study completed

Internal request for decision in Uzbek Government

JICA preparatory survey

E/N and L/A execution

Consultant selection

Consultancy contract execution

Detailed design and bid documentation Bidding for facility construction (plasma product factory) Bidding for facility construction (plasma product factory) Bidding for facility construction (plasma product factory) Bidding for facility construction (plasma product factory)

Equipment delivery (plasma product factory)

Equipment installation, plant installation arrangement and delivery (production facilities) Equipment procurement bidding (Tashkent City and regional blood centers)

Equipment production (Tashkent City and regional blood centers) Equipment delivery, installation, operational instructions and handover (Tashkent City and regional blood centers) Equipment installation and operational instructions (production facilities, Tashkent City and regional blood centers) Staff training (production facilities, Tashkent City and regional blood centers)

Defect liability period

Source: Study team

2) Potential Risks Based on the findings of this study, the following matters require continued study and analysis, in which an unexpectedly long time or a review of the project scope may be needed. Thus, there are the potential risks that may prevent project realization. Further studies based on sufficient consultation and agreement with relevant international and domestic authorities and bodies are required to realize the project.  Impact of new president’s mid- and long-term investigation plan and economic and financial policies on this project  Evaluation of needs and market conditions of export counterparts in relation to surplus exporting  Incorporation of long-term follow-up services into a yen-loan package  Verification of STEP yen-loan conditions  Human resource and operational budget planning on Uzbek side  Recruiting and dispatching appropriate operation instructors in both quality and quantity  Active acceptance of technical guidance on Uzbek side

S-7 (6) Maps of Project Sites in the Study Target Country

Figure S-2 Project Sites across the Country

(1)

(2) (5) (10) (4) (3) (7) (9) (6) (8)

(11)

(12) 100 km

Source: A map image from Google Maps was modified by the study team

S-8

Figure S-3 Project Sites across Tashkent Province (2)

(6) Tashkent (3)

(4) (5) (1)

2 km

(7) Chirchik

Tashkent 5 km

Plasma product factory Within the premise of the Republican Blood (1) Existing plasma product factory Transfusion Center in Tashkent City Blood transfusion stations in Tashkent Province (1) Republican Blood Transfusion Center (2) Blood transfusion station in the 2-clinic of Tashkent Medical Academy (3) Blood transfusion station in the 3-clinic of Tashkent Medical Academy (4) Tashkent City Blood transfusion station in the Republican Scientific Center of Surgery Blood transfusion station in the Republican Scientific Center of (5) Emergency (6) PNN Blood Center (7) Chirchik Chirchik Blood Transfusion Station The gray-shaded station (1) is a target site of the project.

Source: A map image from Google Maps was modified by the study team

S-9

Chapter 1 Overview of the Host Country and Sector

(1) Economic and Financial Circumstances of the Counterpart Country

1) General Background of Uzbekistan Uzbekistan is a republic with a land area of about 447,400km2 and population of about 31.29 million1. Its capital is Tashkent City, located in the northeastern part of the country. The country consists of Tashkent City, 12 provinces and the Republic of Karakalpakstan.

Figure 1-1 Map of Uzbekistan

Uzbekistan

Kazakhstan

Uzbekistan Kyrgyzstan

Turkmenista n Tajikistan

Iran Afghanistan

Source: Aflo Mall map image a) Natural environment Uzbekistan has a continental climate, in which temperature largely varies daily and yearly; temperature reaches around 40℃ in summer and reach around -10℃ in winter. Its annual precipitation is 206 mm/year, which is much lower than Japan’s 1,718 mm/year)2. The air is especially dry in summer.

Located over the Asia-Europe seismic zone, Uzbekistan is prone to earthquakes. In 1966, a great earthquake centered in its capital Tashkent occurred and recently an earthquake near Fergana Province killed many Uzbek in 2011. b) Geopolitical position As Uzbek neighboring countries (Kazakhstan, Kirghiz, Tadzhikistan, Turkmenistan, and Afghanistan) are all landlocked countries, Uzbekistan is a doubly landlocked country, from which you have to cross over at least two borders to reach an ocean. The climates of neighboring countries are critical in promoting external trade, and the direction of Afghanistan, which is in a poor security situation, is, especially, a concern of Uzbekistan. c) Culture, ethnicity and history etc. In the 7th century, the country was started to be Islamized along the invasion of Arab forces into Central Asia and now the dominant religion in the country is Islamism (Sunni). Major ethnic groups in Uzbekistan are Uzbek (78.4%), Russian (4.6%), Tajik (4.8%) and Tartar (1.2%)3. The national language is Uzbek while Russian is also spoken in some parts of the country. The first ethnic group acting in the land before the 7th century was the Irani.

1 Source: World Bank (2015) 2 Source: 2008 Land Infrastructure and Transport White Paper 3 Source: Basic Data, Ministry of Foreign Affairs of Japan (as of December 28, 2016)

1-1 After the Islamization in the 7th century, the land went through Mongolian rule starting from the 13th century and Russian rule from the 19th century, and upon the downfall of the Soviet Union in December 1991, the country became independent as the Republic of Uzbekistan. d) Political situation Since the independence from the Soviet Union in December 1991, the former President Islom Karimov has long governed Uzbekistan. The former President Karimov established the government base with a focus on political stability and economic policies toward progressive transition to a market economy. The Uzbek Congress is bicameral with upper and lower houses. Uzbekistan bans Islamic extremist activities in the country and is especially cautious about movements of Islamic guerrillas near its borders with Afghanistan, Kirghiz, and Tadzhikistan.

After the sudden passing of President Karimov in September 2016, the upper and lower houses named then Prime Minister Mirziyoyev as Acting President. In December of the same year a presidential election was conducted and the Acting President Mirziyoyev, who won the election, assumed the presidency. As the new President Mirziyoyev has handled the government by following the policies of the former president, no significant political turbulence or economic impact is expected, at least for the present. e) Demographics As shown in the following chart, the Uzbek population has increased annually and it crossed the mark of 31 million in 2015. The population growth is expected to continue at least for the near future and it is expected to reach 40 million by 2035.

Figure 1-2 Changes in Uzbek Population

Source: World Bank, World Development Indicators (2016)

2) Uzbek Economic and Financial Circumstances a) National economy Changes in Uzbek real GDP growth rate are shown in Figure 1-3. A high growth rate has been maintained for the 10-year period from 2005, with steady growth in total nominal GDP and nominal GDP per capita.

1-2 Figure 1-3 Uzbek Real GDP Growth Rate (2005-2015)

(%)

Source: IMF, World Economic Outlook (April 2016)

Figure 1-4 Uzbek Total Nominal GDP and Nominal GDP per Capita

Nominal GDP

)

) Nominal GDP per capita

USD

(

Billion USD (

Source: IMF, World Economic Outlook (April 2016) b) External trade and economic balance Described in this subsection is the breakdown of Uzbek imports/exports by countries and the country’s relationship with Japan. As Uzbekistan has maintained a close relationship with Russia since its independence, Russia is the biggest trade counterpart of the country.

China is also one of its major trade counterparts. In the Uzbek-China summit in 2012, the relationship between the countries was raised to a strategic partnership and China has actively invested in infrastructure projects in Uzbekistan. Thus, imports of iron and steel, cement, and construction equipment etc. from China are expected to grow further.

On the other hand, Japan accounts for only 0.5% of its exports and over 1% of its imports.

1-3 Figure 1-5 Uzbek Exports by Countries

Russia

Others

Kazakhstan

Afghanistan

Turkey China

(In %)

Source: Uzbek imports statistics, JETRO (by countries and regions) (2016)

Figure 1-6 Uzbek Imports by Countries

Russia Others

China Germany

Kazakhstan Korea (In %)

Source: Uzbek imports statistics, JETRO (by countries and regions) (2016)

Table 1-1 Major Indicators of Uzbek Trading

Indicators Values Exports 6,553.4 (in million USD) Exports to Japan 2.5 (in million USD) Imports 11,858.5 (in million USD) Imports from Japan 278.6 (in million USD) Current account balance (b.p.) 93 (in million USD) *Estimate Current account balance (b.p., property) 2,040.6 (in million USD) *Estimate Exchange rate against USD 2,568 (UZS)

Source: Basic economic indexes, JETRO (2015)

1-4 Figure 1-7 Major Export Items of Uzbekistan

Others Energy products

Chemicals & plastic products

Food products Machinery & equipment

Iron & steel Non-ferrous Service metals Cotton fiber

(In %)

Source: Uzbek imports statistics, JETRO (by items) (2016)

Figure 1-8 Major Import Items from Japan to Uzbekistan

Others

Service

Machinery & Energy equipment products

Iron & steel Non-ferrous metals

Food products Chemicals & plastic products

(In %)

Source: Uzbek exports statistics, JETRO (by items) (2016) c) Financial situation Changes in Uzbek revenue, expenditure and the fiscal balance are shown in Figure 1-9. Both revenue and expenditure have increased annually and the fiscal balance surplus has been maintained. This trend is expected to continue. Thus, Uzbekistan is a country with a stable growth potential.

1-5

Figure 1-9 Changes in Uzbek Revenue, Expenditure and Fiscal Balance (2005-2015)

Revenue

Expenditure (Billion UZS) (Billion

Fiscal balance

Note: the values for 2015 are estimates

Source: IMF, World Economic Outlook (April 2016)

(2) Overview of Project Target Sector

The target sector of this project is blood services, which refer to an entire system of producing blood products for disease treatment from human blood collected from sources such as blood donors and supplying them to the public. Blood products include blood products for transfusion (blood components) and plasma derivatives. Generally, organizations and bodies relevant to blood services are engaged in the collection of raw materials (human blood), production of blood products and supply of raw materials and products etc.

Figure 1-10 Images of Blood Products

Whole blood Whole blood products Blood

Blood component preparation

Plasma Platelets Blood cells Plasma Platelets Blood cells Plasma derivatives

Albumin Immune globulin Blood coagulation products products factor products Antithrombin Tissue additives Other plasma III products derivatives

Plasma derivatives

Source: Japan Association of Blood Preparations and Japan Red Cross websites, and Japan Blood Products Organization’s booklet (2015)

1-6 1) Overview of Blood Services in Uzbekistan In Uzbekistan, the Ministry of Health of Uzbekistan (hereinafter “MOH”) controls all blood service operations. The Uzbek blood services are composed of the Republican Blood Transfusion Center (having both blood center functionality and plasma derivative production capabilities) located in Tashkent City, 17 blood transfusion stations across the country and 185 blood banks within medical institutes across the country. The 17 blood transfusion stations include several national medical centers under direct control of MOH (the Republican Scientific Specialized Center of Surgery, the Republican Scientific Center of Emergency, the 2-clinic of Tashkent Medical Academy, and the 3-clinic of Tashkent Medical Academy), which have superior capabilities to other general blood banks. In addition to these, there is an institute called Scientific Production Enterprise in Tashkent City, which independently collects blood, manufactures and supplies plasma derivatives.

Figure 1-11, provided by MOH, shows the relationships among bodies and institutes involved in Uzbek blood services. As shown in the figure, the blood services are composed of the relevant organizations with the Republican Blood Transfusion Center playing a central role.

Figure 1-11 Structure of Blood Services

Note: The blood transfusion functions of the Republican Specialized Center for Obstetrics and Gynecology and the Tashkent Pediatric Medical Institute have not been used since 2012.

Source: material provided by MOH translated by the study team

1-7 Table 1-2 shows the total number of workers engaged in Uzbek blood services, disclosed by MOH. According to the information, approximately 1,700 workers are engaged in the operations of organizations associated with blood services across the country.

Table 1-2 Workers Engaged in Uzbek Blood Services

Job types Count a) Clerks 58 b) Technologists 38 Physicians 381 Nurses 1,028 Pharmacists 1 Medical technologists ‐ Others 225 c) Researchers ‐ d) Others ‐ Total 1,731

Source: Material provided by MOH translated by the study team

The figure below illustrates an overall picture of the blood services in Uzbekistan revealed through a local study. Functions of Uzbek blood services are distributed among related bodies, whose functions vary. Also, the raw material blood is not only collected from donors as is generally done in Japan, but through a unique system of “family donors,” which is not seen in Japan.

Supplies of blood products for transfusion are controlled by the blood centers and medical institutes, and there are some distinct rules of blood product supply; for example, the amount of blood products transfused is limited based on the amount of blood donated by the patients. Further, as the shortfall of plasma derivatives is filled by imports and imported plasma derivatives are also available in the market, there are actually multiple supply channels of imported plasma derivatives in Uzbekistan.

Figure 1-12 Overview of Blood Services in Uzbekistan

Source: Study team

1-8 2) Status of blood donation Blood is a fundamental basis for blood services and is collected by MOH in Uzbekistan through donations by the public. As shown in the figure below, the number of blood donors has increased annually, but about 60% of the total is accounted for by “family donors” (i.e., donations for family members) and only the remaining 40% is non-remunerated blood donation from the general public. There are cases of remunerated blood donations, but such cases are limited to the collection of rare blood types and the ratio to total blood donation is minimal.

Figure 1-13 Changes in the Number of Blood Donors in Uzbekistan

remunerated blood donations

non-remunerated blood donation

family donors

Source: prepared by the study team based on material received from MOH (Changes in Blood Donors in 2009-2015) In principle, people donate blood at the Republican Blood Transfusion Center, blood transfusion stations in each province and blood banks under the stations. As shown in the figure below, Tashkent City, which has the largest population in the country, produces the largest number of blood donors among other provinces.

Figure 1-14 Number of Donors in Uzbekistan by Provinces and National Hospitals

Tashkent City

Total of all other Provinces

Source: prepared by the study team based on material received from MOH (Changes in Blood Donors in 2009-2015)

1-9 3) Status of plasma derivative production a) Status of plasma derivative supply In the production and supply of plasma derivatives in Uzbekistan, the existing plasma product factory of the Republican Blood Transfusion Center in Tashkent City, which produces albumin and immune globulin for I.M., has played a central role. Besides the center, albumin is also produced by the Scientific Production Enterprise in Tashkent City, as well as the Republican Scientific Specialized Center of Surgery, and Andizhan Blood Transfusion Station, etc. Besides those MOH institutes, Uzbekistan Railways and the Blood Transfusion Center of the Uzbekistan Ministry of Defense also produce a small amount of albumin.

The following tables show the changes in production volume disclosed by MOH. Annual production volume of albumin is about 600-700L and that of immune globulin for I.M. was reduced by half between 2012 and 2015. In the past, albumin was produced in the Bukhara Blood Transfusion Station and the blood transfusion center of the second clinic of Tashkent Medical Academy etc., too. However, they ceased production with the intention of MOH to integrate all the plasma derivative production functions into the factory in the Republican Blood Transfusion Center.

Table 1-3 Changes in Plasma Derivative Production Volume by Institutes

Source: material provided by MOH translated by the study team

The present production volume is not enough to satisfy the national demand and the shortfall is filled by imports as indicated in Table 1-4. For immune globulin for I.V. and factor-III products, which cannot be produced domestically, the country fully depends on imports. Its major import trading partners are pharmaceutical makers in Russia and Eastern Europe and the annual import amount the country has paid for is reported to be several hundred million JPY. This is why Uzbek MOH considers it an urgent task to meet domestic demands by enhancing production capacity of the plasma product factory to replace imports.

1-10 Table 1-4 Changes in Blood Product Imports

Source: The Pharm Committee, MOH

4) Conditions of Major Institutes a) Republican Blood Transfusion Center 1. Facility overview The Republican Blood Transfusion Center is a leading institute of Uzbek blood services. On its premise, the institute has a blood center with blood collection, testing, production (blood products for transfusion), product storage and supply capacities and a plasma product factory.

There are separate areas for blood collection, production, supply and testing on the ground floor of the blood center, and the main inspection areas and administrative department on its second floor. The center is one of the facilities that received financial support from ADB4 since 2004, and its apheresis devices, refrigerators and test equipment etc. were introduced with the support of ADB.

Figure 1-15 Front and Entrance of the Republican Blood Transfusion Center

Source: Study team

4 A maternal and child health project was implemented with support of ADB from 2004 through 2011. For blood services, equipment and training etc. were also provided by ADB. For more information, refer to Chapter 9.

1-11 2. Functions of the Republican Blood Transfusion Center (the blood center section)  Its blood collection area has a waiting space for donors, and provides functions for reception (application forms and interview sheets are provided; PC-based reception), preliminary testing (blood type and hemoglobin level), interviews by a doctor and blood collection (14 beds and 2 apheresis devices). The production area is equipped with centrifugal separators, blood separators, freezers and refrigerators.  Red blood cells, plasma and albumin are stored in the supply area. Hospital staff will come to take the products when a hospital needs any blood products (as per the contract between the center and the hospital).  In its testing area, virological, serological and immunological tests are conducted. Thanks to a system introduced by ADB, data obtained by the testing department are input to a PC application and centrally managed by the center. However, such data are not automatically shared with other centers and MOH via the Internet and are delivered to MOH in a physical storage devices.  While donors and donated blood bags are basically managed by barcodes, hand-written ledgers and records are also made besides electronic records in a computer.  X-ray radiation to blood products for transfusion is conducted only when requested.  2 bloodmobiles and 2 equipment carriers (station wagons) are available. Blood collection teams are dispatched to provincial hospitals with blood banks, schools and private businesses etc. for blood collection. In Tashkent Province, there are 42 hospitals under control of the center and 10 out of the hospitals are engaged in the blood collection service.  The bloodmobiles have 2 beds each. However, these vehicles are antiquated and they possess no equipment or functions other than the installed beds.  A blood collection team normally consists of a driver, 4 nurses and a doctor.  The number of donors outside the center is about 100 per day. It is 20 to 30 per location and generally a team visits 3 locations daily. For blood campaign at schools, the center’s representative promotes the campaign to schools in advance. The number of employees at the Republican Blood Transfusion Center is as follows.

Table 1-5 Number of Employees at the Republican Blood Transfusion Center Job types Count Clerks 12 Physicians 48 Nurses 99 Pharmacists 1 Medical technologists 1 Others 50 Total 211 Source: MOH

3. The conditions of equipment introduced to the Republican Blood Transfusion Center (blood center section) The main existing equipment items in the Republican Blood Transfusion Center (blood center section) are listed in the table below. Equipment introduced with support of ADB is also listed.

Table 1-6 Main Existing Equipment Items in the Republican Blood Transfusion Center (blood center section)

Blood collection dept. 1 Single-channel hemoglobin determination equipment with consumables 2 Plasma apheresis device 3 Blood collection bed Testing dept. 1 Immunohematological analyzer with reagents 2 Centrifugal separator for experiments 3 Binocular immersion microscope Production dept. 1 Manual plasma extractor 2 Automatic tube sealer Supply dept. 1 Plasma freezer 2 Refrigerator 3 Plasma refrigerator for blood center

1-12 Source: answer to inquiry Unlike the plasma product factory described below, the center has no dedicated facility maintenance personnel and asks manufacturers to repair equipment failures, which impedes the center’s operational efficiency. The mode of training on the operation of the facility’s equipment is basically OJT; generally senior staff members teach new staff about how to operate by following the respective manuals. b) Plasma product factory 1. Facility overview The facility is a two-story annex building located within the premises of the Republican Blood Transfusion Center and the production processes are conducted on the ground floor and the second floor (mezzanine floor). There are a freeze-drying room on the ground floor and fractionation and dispensing rooms on the second floor.

As there are large cracks on the production site floor, little attention has been paid to hygiene and the production environment is not sufficiently controlled to ensure product quality. Most of the equipment was manufactured in the 1980s to 1990s and are seemingly antiquated and have past their service life. It is reported that equipment failure occurs frequently. Further, when any one machine within the production line fails, then the entire production line must stop until the failed machine is restored.

22 staff members are working for the production dept., including an engineer and 6 technologists in the factory. Those technical staff fix any failure of the production machines as far as possible. However, they have to ask equipment manufacturers for repair in case of any failure outside their capabilities, and this further drags down the production efficiency of the factory.

2. Plasma derivative production flow In this facility, precipitate is extracted from frozen plasma after melting by using Cohn’s cold ethanol fractionation process and the precipitate is freeze-dried to remove ethanol. The resultant freeze-dried powder is dissolved. After adjusting the concentration, the solution is sterilized and filtrated and then poured into a glass bottle in bulk. After being poured into a bottle, albumin goes through a virus inactivation process at 60℃ for 10 hours (bottle pasteurization).

3. Production site quality control In Japan, there are strict standards regarding the quality of blood products for transfusion and plasma derivatives and every lot of such products are subject to a national test. In Uzbekistan, however, only an extraction test is conducted about once a year for to grant national production approval. Blood product production in Uzbekistan is said to be conducted as per applicable pharmacopoeia, official standards regarding products and raw material plasma (FS-Uz-42-1016:2015 Plasma Fractionation Method) and quality standards for process management and final products (FS-Uz-41-0175: 2016 Albumin 5%/10%/20% Products, FS-42-Uz-0906-2011 Antistaphylococcal Immune Globulin Products, FS-42-Uz-0020-2011 Human Immune Globulin, etc.).

4. Human resource development conditions The mode of training for the facility staff is basically OJT; generally senior staff members teach new staff about their operations by following the internal operation manuals. The production processes are mostly manual and no systematic training and education have been conducted. Thus, there is a concern of varied product quality depending on the skill levels of production staff.

5. Conditions of introduced equipment (manufacturer, model and year of introduction) Existing equipment items in the factory are listed in the table below. As mentioned above, most of the equipment items were manufactured in the 1980s and 1990s. In consideration of the fact that the amortization period of manufacturing machinery is generally 5-10 years, most of the machines in the factory are past their service life.

1-13 Table 1-7 Main Equipment Items Available in the Existing Plasma Product Factory

Source: MOH c) Samarkand Blood Transfusion Station This blood transfusion station covers the entire Samarkand Province. As with the case of the Republican Blood Transfusion Center, it received support from ADB for renewing some equipment and, consequently, its operational efficiency, and safety and management of donated blood bags were reportedly improved.

There are 20 blood banks in the province and they are basically annexed to the respective district hospitals. The blood banks are visited by mobile teams (blood collection team) from the station for blood collection.

Between 2014 and 2015, the number of blood donors in this region was significantly increased from 12,400 to 17,295 largely due to the blood donation promotion activities, and so was the number of non-remunerated blood donors. In the past, the region suffered a shortage of donated blood and of blood products. Today, in contrast, internal demands of the province can be satisfied thanks to the increased blood donation, and the blood transfusion station even transfers surplus raw material plasma to the Republican Blood Transfusion Center.

In the past, the station had production facilities for plasma derivatives (albumin and globulin), but production at this station was ceased in 2006. Since then, the station has transferred raw material plasma collected in the province to the Republican Blood Transfusion Center and received plasma derivatives from the center.

The facility adopts the common processes of the country’s other blood transfusion stations: entrance, reception

1-14 (based on a system introduced with the support of ADB; identity check by passport), testing (blood cell count and blood type), interview and blood collection. There are 4 beds and 2 apheresis devices in the blood collection area. For blood products for transfusion, collected blood goes through separation, testing (virological, serological and immunological tests, etc.) and supply processes at this station.

It was explained that medical wastes are incinerated in an incinerator in the premise and there is no specialized medical waste disposer. d) Navoi Blood Transfusion Station As the station’s building is a former kindergarten building renovated 6 years ago, the interior and exterior appear relatively new. The functions of the facility are the same as those of the Samarkand Blood Transfusion Station. The station is also equipped with minimal required equipment for the production of blood products for transfusion, including equipment introduced with the support of ADB. There are 6 beds in the blood collection area. The station has no bloodmobile.

In Navoi Province, there are 8 blood banks besides the station, all of which are annexed to a hospital. Each hospital also introduced refrigerators for blood product storage with the support of ADB. The blood banks in the province can receive blood products for transfusion from the station depending on the amount of blood the banks provided to the station.

Plasma derivatives are also not produced at the station. The station sends raw material plasma to the Republican Blood Transfusion Center and receives plasma derivatives in exchange. It was explained that they send raw material plasma in cold containers along with refrigerants. e) Nukus Blood Transfusion Station This station is a central blood center of the Republic of Karakalpakstan and also the only station with testing and production capacities in the autonomous republic. Although hospitals in the autonomous republic had testing and production capacities in the past, such functions were integrated into the central facilities in response to guidance from the central government in 2012.

In the Republic of Karakalpakstan, there are 25 blood banks in 25 hospitals, which are visited by mobile teams of the station for blood collection. The blood banks serve as blood collection sites and their functions are limited to gathering donors and storing blood products for transfusion.

The station receives about 35 blood donors per day, which adds up to about 5,500 blood donors annually. Also, it collects blood from about 4,500 blood donors outside the station; 80% of them are from blood banks and the remaining 20% is from schools and private companies. A breakdown of donors is: non-remunerated blood donors (25-30%), family donors (70-75%) and zero remunerated blood donors. Six beds for blood collection and 2 apheresis devices are available.

The station has no bloodmobiles, and only 2 vans to carry blood collection teams and their equipment. As the fartherest blood bank is located 230km away, cold containers are used for transportation. It was explained that a mobile team is dispatched to each blood bank on a weekly basis.

Functions of the station are mostly the same as those of other regional blood transfusion stations and a functional flow of processes (reception, preliminary testing, interview, blood collection, production, testing and storage) has been established. It also received the support of ADB for equipment upgrades, i.e., electronic reception and barcode management systems.

While being under control of the MOH of the Republic of Karakalpakstan, the station is under the supervision of the Republican Blood Transfusion Center regarding operations and implementation of the blood services. Thus, the station has monthly teleconferences for reporting and consultation with the center. f) Chirchik Blood Transfusion Station This station is the provincial blood center of Tashkent and located in Chirchik, Tashkent. It was located in a different place until 2004 when it was moved to its present location, a renovated building formerly used as a kindergarten building.

This station dispatches blood collection teams to 16 hospitals within the Tashkent Province for blood collection. It performs no production and testing operations and the blood it collects is sent to the Republican Blood

1-15 Transfusion Center for production and testing etc. It possesses no bloodmobiles.

Blood products for transfusion are provided by the Republican Blood Transfusion Center to the station, which in turn supplies them to 6 medical institutes in Chirchik and 16 hospitals in Chirchik and neighboring cities/provinces. Blood bags used in this facility are purchased within the budget of the city of Chirchik, Tashkent.

5) Issues Related to Blood Services From the findings of the local study, several issues in Uzbek blood services were identified. For the purpose of this study, consideration is given to those issues for the realization of projects that take advantage of support from Japan.  Due to the small number of blood donors and high ratio of family donors among them (about 60%), a sustainable and stable blood supply (including plasma for production of plasma derivatives) has not been realized.  The number of mobile blood collection units, such as bloodmobiles, is insufficient, and there are no permanent donation rooms.  The supply of platelets is extremely low, except in Tashkent, and only a small amount of platelets is imported.  Safety measures commonly implemented in Japan have not been implemented in Uzbekistan: donors’ blood sample storage; diversion of the initially drawn blood to prevent skin bacteria from being mixed in; reduction of leukocytes to prevent side effects; and an FFP inventory hold for look-back studies.  An absence of a nucleic acid amplification test (NAT5) poses a risk of infected blood getting past testing.  Products that require temperature control are shipped with cold containers only. This poses a risk in quality control.  Even equipment introduced with the support of ADB is not fully utilized due to the difficulties of procuring consumables and insufficient maintenance.  The plasma product factory is very old with antiquated machines. Moreover, pre-modern production techniques are used.  There are no clean rooms available and the hygiene and process management of blood products are poor.  The absence of nucleic acid amplification tests (NAT) poses a risk of infected plasma getting past testing.  Frozen plasma that requires temperature control is shipped with cold containers only. This poses a risk in quality control.  Patients have to personally purchase expensive imported products if hospitals lack drug stock. This is an inconsistency with the country's policy to provide the people with free health care.  The country has to depend on imported plasma derivatives, which results in payments of a large amount of foreign currency every year.  While MOH’s GMP was amended in 2015, the facility does not satisfy the amended GMP. There are 4 domestic companies complying with the present GMP.

5 To prevent virus infection via blood products, donated blood must go through virus testing. The antigen/antibody test (a virus test) is to detect antigens/antibodies produced in blood after infection, and cannot detect infection for some time after infection (the window period). On the other hand, NAT amplifies the part of nucleic acids (DNA or RNA) consisting of viruses 100,000,000x in order to detect viruses. Therefore, NAT is highly sensitive and specific and can minimize the window period for precision testing. The table below compares the window periods of the antigen/antibody test and the NAT. Virus type Antigen/antibody NAT Hepatitis B virus HBsAg test NAT (HBV DNA) 1 Approx. 59 days Approx. 34 days Hepatitis C virus Anti-HCV test NAT (HCV RNA) Approx. 82 days Approx. 23 days Human immunodeficiency virus Anti-HIV-1 and NAT (HIV RNA) (AIDS virus) anti-HIV-2 test Approx. 11 days Approx. 22 days

1-16 6) Overview and Comparison of Current Status of Blood Services in Japan a) Overview of Current Status of Blood Services in Japan The Japan Red Cross’s blood center operations and supply of blood products for transfusion, and production of plasma derivatives by private businesses are the main pillars of blood services in Japan. The figure illustrates the overall picture.

Figure 1-16 Overall Picture of Blood Services in Japan

Source: Japan Red Cross’ booklet b) Facilities Associated with Blood Services in Japan The purpose of this study is to reveal the feasibility of forming projects for transferring Japanese technology and know-how to Uzbekistan. Therefore, an overview of a representative blood center and plasma product factory is described in this section for comparison.

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1. Japanese Red Cross Hokkaido Block Blood Center / Hokkaido Red Cross Blood Center

Figure 1-17 Overview of Japanese Red Cross Hokkaido Block Blood Center / Hokkaido Red Cross Blood Center

Wakkanai

Asahikawa Hokkaido Block Blood Center / Hokkaido Red Cross Blood Center Kitami

Atsubetsu

Muroran Kushiro Obihiro

Tomakomai

Hakodat e Tomakomai

Source: Japan Red Cross website

 Facility overview  This is one of the 7 block centers across Japan, engaged in testing and production (separation) of blood donated by 270,000 donors annually from branch and field stations across Hokkaido. It also provides other services such as umbilical cord blood storage.

 Facility features

 Its blood collection department gives consideration to amenities and privacy to attract more donors.  Its testing department operates multiple test devices to handle tests on blood from 800 donors per day. Individual NAT is conducted. However, machines used for NAT are not made in Japan.  Biochemical and hematological tests, which are not necessary for production of blood products, are conducted as a service for blood donors. Test results are sent to donors who wish to receive results.  Frozen samples are retained for 11 years to ensure traceability.  Its production department promotes mechanization for some part of their operations. They produce 700-1000 doses of blood products for transfusion on average per year.  While some processes had to be done in a bioclean room in the past, no bioclean room is needed as machines that do not require sterile environments were introduced.  Machines used by the production department are all made in Japan for ease of after-sales services.  Transportation of blood and frozen plasma between centers is outsourced to a specialized contractor (Air Water Inc.). Specialized custom-ordered vehicles are used.  Private power generators and UPS are used against power failures.

2. Chitose Plant, Japan Blood Products Organization

Figure 1-18 Chitose Plant, Japan Blood Products Organization

Source: Japan Blood Products Organization website

1-18

 Facility overview  This facility was built in 1983 as a plant of the Japan Red Cross, and transferred to Japan Blood Products Organization in 2012.  It produces plasma derivatives from raw material plasma purchased from the Japan Red Cross.  Freezers are automated mechanical cold storages constantly kept under -30°C.  Cohn’s cold ethanol fractionation process is employed. A variety of plasma derivatives is produced from single raw materials by repeating the fractionation process.

 Facility features  All production processes are connected by piping so that raw material and products are not exposed to ambient air.  The dispensing process is conducted in a clean room.  A private alcohol processing facility is available within the premises to reuse alcohol.  There is also a private effluent treatment facility.  Private power generators and UPS are used against power failures. c) Comparison of Japanese and Uzbek Blood Services Blood services of the countries are compared in tables below in terms of implementation system, donors, donated blood/blood products, and test items/methods.

Table 1-8 Blood Donation Implementation System

Uzbekistan Japan Responsible organization National and local governments Japan Red Cross (JRC) Blood donation campaign Red Crescent, national and local National and local governments, governments JRC No. of blood centers National blood centers: 1 JRC block blood centers: 7 Municipal blood transfusion stations: JRC local blood centers: 47 15 Blood transfusion stations in national hospitals: 4 Blood transfusion stations in municipal hospitals: 185 Blood collection sites National and local blood centers, and JRC local blood centers blood transfusion stations in national hospitals Bloodmobiles: 2 Bloodmobiles: 292 Donation rooms: 0 Donation rooms: 129 No. of workers 1,731 6,432

Source: Study team

1-19 Table 1-9 Donor Comparison Table

Uzbekistan Japan No. of donors per year 156,000 (2015) 4.88 million (2015) Donor ratio 0.5% 3.9% Collection categories Whole blood 96.5% 72% Platelet apheresis 3.4% 16% Plasma apheresis 0.004% 12% Donor types Family donors 60% 0 Non-remunerated donation 40% 100% Remunerated donation Few (for raw material for special immune globulin only)

Source: Study team

Table 1-10 Donation and Production Comparison Table

Uzbekistan Japan Donation types 500mL 200mL, 400mL Transfusion conditions Family or relatives must donate blood and obtain a certificate. Otherwise, patients have to buy blood. Transfused free of charge in case of emergency. Blood supply Hospitals have to pick up blood at a Blood centers deliver blood to blood center hospitals Blood product prices When there is no blood donor for a NHI standards patient Whole blood 242,000 UZS (about 8,228 JPY) 16,320 JPY (before leukocyte reduction radiation) Red blood cells 250,700 UZS (about 8,524 JPY) 16,805 JPY (before leukocyte reduction radiation) Plasma 260,400 UZS (about 8,854 JPY) 17,912 JPY (before leukocyte reduction radiation)

Source: Study team

Table 1-11 Test Items and Method Comparison Table

Uzbekistan Japan Blood typing ABO, Rh ABO, Rh, Irregular antibody, HLA (not all) Infection test ELISA (=EIA) CLEIA Enzyme-linked immunosorbent assay Chemiluminesent enzyme immunoassay Infection test items Syphilis, HBsAg, Syphilis, HBsAg, anti-HBs, anti-HCV, anti-HBc, anti-HIV-1, anti-HIV-2, anti-HCV, brucellosis, anti-HIV-1, anti-HIV-2, malaria, anti-HTLV-1, human parvovirus S-GPT (ALT) B19, S-GPT (ALT) NAT Not performed HBV, HCV, HIV Testing service for donors Not performed Biochemical test Hematological test

Source: Study team

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Table 1-12 Comparison Table for Plasma Derivatives

Uzbekistan Japan Producers Blood centers, hospitals - 3 private operators Plasma volume distributed 4,000L (estimate for 2016) 965,000L (2016) annually Pooled plasma NAT Not performed HIV, HBV, HCV Virus inactivation/removal Alcohol fractionation, pasteurization Alcohol fractionation, treatment pasteurization, S/D processing, dry heating, virus removal film, etc. Main plasma derivatives Albumin - Globulin for I.V. and I.M. Globulin for I.M. - Specialized immune globulin Specialized immune globulin - Albumin (cryoprecipitate: produced at blood - Blood coagulation factors VIII collection sites) and IX products - Antithrombin III products - Fibrinogen, etc. GMP compliance No experience of GMP-compliant Compliant production

Source: Study team

(3) Conditions of Target Areas

The table below indicates information of all Uzbek areas including target areas of this project. Tashkent City, Andizhan Province, Samarkand Province and the Republic of Karakalpakstan are the target areas of this project, but the project aims to spread its benefits to the entire country starting from those areas.

Table 1-13 Basic Data of Project Target Areas

Name Population Area No.of Capital city (in 1,000) districts Tashkent City 2,393.2 - Andizhan Province 2,910.5 4,200 14 Andizhan Bukhara Province 1,815.2 39,400 11 Bukhara Fergana Province 3,505.3 6,800 16 Fergana Jizzax Province 1,276.1 20,500 12 Jizzax Namangan Province 2,603.4 7,900 11 Namangan Navoi Province 927.9 110,800 8 Navoi Qashqadaryo Province 3,025.6 28,400 14 Kalush Samarkand Province 3,583.9 16,400 14 Samarkand Syr Darya Province 790.6 5,100 9 Gulistan Surxondaryo Province 2,411.5 20,800 14 Termez Tashkent Province 2,794.1 15,300 15 Tashkent Khorazm Province 1,746.9 6,300 10 Urgench Republic of Karakalpakstan 1,791.1 165,600 15 Nukus

Source: uzstat

The following map shows the provisional division of blocks under consideration for this project. A suitable division is sought where the positive impact of the project on the target areas will reach the neighboring provinces.

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Figure 1-19 Proposed Division of Blocks for this Project

1 Tashkent City 2 Andizhan Province 3 Bukhara Province 4 Fergana Province 5 Jizzax Province 6 Namangan Province 7 Navoi Province

8 Qashqadaryo Province 9 Samarkand Province 10 Syr Darya Province 11 Surxondaryo Province 12 Tashkent Province 13 Khorazm Province 14 Republic of Karakalpakstan Source: Study team

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Chapter 2 Study Methodology

(1) Study Details

1) Study Items In this study, the following matters were investigated. a) Specific matters regarding the plasma derivative market  Current market situation  Annual volume of blood or plasma collected  Number of patients suffering related diseases (by treatment type)  Supply sources (import situation)  Healthcare insurance system  Medical expense per capita b) Specific matters regarding the regional blood transfusion stations and the Republican Blood Transfusion Center  Blood collection department (number of donors, equipment, procedures and workforce, etc.)  Testing department (number of tests, equipment, procedures and workforce, etc.)  Production department (number of doses produced, equipment, procedures and workforce, etc.)  Supply department (number of doses supplied, equipment, procedures and workforce, etc.)  Logistics department  Initial building study and building equipment conditions  Equipment maintenance, facility operation and maintenance conditions c) Confirmation of opinions of implementing organization based on current plan  Confirmation of current plan, proposed project scope and consistency with other projects  Confirmation of implementing organization and their opinions on implementation of the proposed project d) Study on the current system and operation situations of existing facilities  Study on the overall picture of today’s Uzbek blood product production and supply systems and on the operating status of existing related facilities  System scheme  Status of production approval by the national government (processes and targets)  Organizational chart and workforce of the production site  Production flow  Presence/absence of production manuals, change procedures to be followed in the event of any change in production methods, records thereof, and inspection frequency  Presence/absence of factory audits by national government, and frequency of such audits (if any)  Presence/absence of pre-shipment inspections by the national government  Current factory operations (number of workers, and organization, etc.) e) Approval and license systems related to construction  Study of approval and licensing systems regarding construction and verification of basic laws and regulations  Study of approval and licensing matters related to construction work, material and equipment importing and installation, etc. f) Proceedings for project approval within the host country’s government  Check of approval procedures, competent bodies and applicable laws and regulations regarding the yen-loan project implementation (information gathering from relevant authorities) g) Evaluation of project implementation scheme  Assessment of any implementation scheme and system of similar operations in the host country  Verification of responsibilities, supervision and organization to implement the project  Operations, organizational structure, financial status and staff organization of all implementing organization(s) (including their statutory positioning)  Responsibilities, supervision and organization of implementing organization for this project  Organization and capabilities of the implementing organization regarding safety, quality control and scheduling etc. for the project  Implementing organization experience in implementing similar projects h) Evaluation of human resource development planning

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 Verification of staffing and development status etc. in relation to the existing system  Evaluation of human resource development planning in view of renovation/establishment of systems and centers (as necessary) i) Evaluation of operational, maintenance and management schemes  Verification of operations, maintenance and management schemes for systems and centers, and obtaining organizational and financial resources j) Evaluation of overall project planning  Planning of facility size, construction methods, plans, fundamental infrastructure development, and equipment list etc. based on a consideration of the project scope  Verification of renewable energy utilization and BCP etc. k) Evaluation of total project cost  Calculation of project cost estimate based on consideration of project planning l) Financial and economic evaluation  Evaluation of profitability of the project based on the calculated estimate of project costs m) Evaluation of procurement circumstances  Study of the local conditions of customary construction work bidding and contracting, local consultants, local contractors and suppliers etc.  Close investigation of precautions for project implementation n) Evaluation of operations and effect indicators  Setting of effect indicators for project monitoring and evaluation (for quantitative effects [operation and effect indicators] and qualitative effects)  Confirmation of environmental and social considerations  Evaluation of environmental impact  Confirmation of the baseline environmental and social conditions (land use and natural environment etc.)  Confirmation of environmental and social consideration systems and organizations of the host country  Environmental and social matters to be considered in relation to implementation of the project, and confirmation of their methods of evaluation  Impact projection  Study on social considerations  Check for critical impact factors o) Proposal of collaboration with other projects  Proposal of possible collaboration with blood supply system support programs implemented in the host country by other countries or international bodies p) Evaluation of utilization of Japanese technology  Inquiring with relevant companies that are already conducting or interested in business in the host country  Evaluating the potential to introduce Japanese technologies and identifying Japanese products that may be introduced  Evaluation of benefits for Japan

2) Study Targets The study target facilities include the existing plasma product factory annexed to the Republican Blood Transfusion Center, blood centers and regional blood transfusion stations.

(2) Study Methodology and Organization

1) Study Methodology For preparation of the study report in line with the study items listed above, a literature review in Japan and a field study in the host country were conducted. During the study period, interim reporting was provided accordingly to METI, the host country government, the Japan External Trade Organization (JETRO), and the Japan External Trade Organization (JICA), etc.

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2) Study Organization The organization of this study is as illustrated in the figure below. a) Study management organization

Figure 2-1 Study Management Organization Chart

Kazuo Nakamoto Kazuyuki Inoue Senior Managing Hajime Kamiosako Masanobu Suzuki President & Officer Deputy Chief, Sales Manager, Representative Director Head of International International Division International Division Shimizu Corporation Division

Source: Study team

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b) Study implementation organization

Figure 2-2 Study Organization Chart

Shimizu Corporation International Division Shimizu Corporation International Division Japan Blood Products Organization General Manager Manager Director Masanobu Suzuki Kuniaki Kume Hirokazu Ito Assigned work：Project Manager Assigned work：Project Manager support 1 Assigned work：Blood Service Planning 3

Japan Blood Products Organization Shimizu Corporation International Division Corporate Planning Section Manager Takehiko Iijima Tatsuya Sugimoto Assigned work：Blood Service Planning (Controller) Assigned work：Project Manager support 2 Shimizu Corporation Tashkent Office Representative Takashi Iwata Japan Blood Products Organization Assigned work：Environmental and Social Analysis Corporate Planning Section Shimizu Corporation International Division Momoko Otaki Assistant Manager Assigned work：Blood Service Planning Support 1 Kenji Mizuno Assigned work：Project Manager support 3 Shimizu Corporation Tashkent Office Dmitriy Maslov(Mr) Japan Blood Products Organization, Chitose Plant Assigned work: Support of local actiuvities Production Dept. I, Production Sec. II, Hitoshi Otsuka Shimizu Corporation International Division Assigned work：Blood Service Planning Support 2 Design Group Designer Shimizu Corporation Tashkent Office Haruhiko Tsuchiya Naira Turakhanova(Ms) Assigned work：Project Manager support 4 Assigned work: Support of local actiuvities Japan Blood Products Organization, Chitose Plant Production Dept. I, Bulk Processing&Filling Sec. Katsuya Iwama Assigned work：Blood Service Planning Support 3

Japan Blood Products Organization, Chitose Plant Chitose Plant Manager Shinichiro Hase Assigned work：Blood Service Planning 1 Japan Blood Products Organization, Kyoto Plant Administration Dept., Engineering Sec. Hideki Yoshii Assigned work：Blood Service Planning Support 4

Japan Blood Products Organization, Kyoto Plant Fractionation Dep, Fractionation Sec.Ⅲ Teruaki Minamoto Assigned work：Blood Service Planning Support 5

Japanese Red Cross Society Blood Service Head Quarter Japanese Red Cross Society Blood Service Head Quarter Management and Planning Department Management and Planning Department Yoshiaki Numata Manager Yuki Matsuyama Assigned work：Blood Service Planning 2 Assigned work：Blood Services Planning Support

Marubeni Corporation Transport & Infrastructure Project Marubeni Corporation Tashkent Liaison Office Department, Manager Head of Representative Yuichiro Urai Yasuaki Fujii Assigned work：Financial & Economic Analysis Support 1 Assigned work: Support of local actiuvities

Marubeni Corporation Transport & Infrastructure Project Department, Manager International Total Engineering Corporation Yuichiro Urai C&E Division, Global Business Group Assigned work：Financial & Economic Analysis Supporet2 Executive Officer, Jun TAKAHASHI Assigned work：Survey Support 1

International Total Engineering Corporation International Total Engineering Corporation Presidential Aide C&E Division, Global Business Group Senior Managing Director, Masaki KOMATSU Assistant Manager, Nobuki KAWASAKI Assigned work：Healthcare/Medical Environment Survey Assigned work：Survey Support 2

International Total Engineering Corporation International Total Engineering Corporation C&E Division, Global Business Group C&E Division, Global Business Group Assistant Manager, Nagaharu YOKOMORI Executive Officer, Kenji ISHIDA Assigned work：Survey Support 3 Assigned work：Healthcare/Medical Environment Survey Support

International Total Engineering Corporation C&E Division, Global Business Group Chief, Masaki HORI Assigned work：Survey Support 4 Source: Study team

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(3) Study Schedule

1) Overall Schedule

Table 2-1 Overall Schedule

2016 2017 Items September October Novemnber December January February

Preparation Work

Exchange of Contract

First Field Study

Progress Meeting Preparing Documents

Draft Submissoiopn

Second Field Study

Follow-up in Uzbekistan

Final Meeting Finalization Report Submission Source: Study team

2) Field Studies a) Field tour of blood-product related facilities in Hokkaido 1. Purpose Before field studies, a field tour of blood service-related facilities of the Japan Red Cross and the Japan Blood Products Organization was conducted with the aim of creating common knowledge of the overall picture of Japanese blood service systems, and assessing their present situation as the basis for evaluating the possibilities of the introduction of Japanese technologies.

2. Visitation schedule The schedule of the visits was as follows.

Table 2-2 Schedule of the Field Tour of Blood Product-Related Facilities in Hokkaido (September 8-9, 2016)

Morning Afternoon 8th Haneda - New Chitose Airport (JB, (Thu) JRC) Preliminary arrangement and preparation for the visits 9th Haneda - New Chitose Airport (Shimizu Chitose Factory, Japan Blood Products (Fri) Corp. Marubeni, ITEC) Organization Japanese Red Cross Hokkaido Block Blood Center, Hokkaido Red Cross New Chitose Airport - Haneda Blood Center Source: Study team

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3. Primary outcomes Because the subject of the project is blood services, a highly-specialized field, the study team established a shared understanding of the project’s overall picture and Japan’s engagement. Also, the possibility of introducing the technology and products of Japan were discussed and evaluated in the face of the practical introduction and operational status of the facilities. b) First field study 1. Purpose The first field study was conducted with the aim of comprehending the current status and issues of the Uzbek blood services and collecting information regarding the systems of the ODA project formation.

2. Study schedule

Table 2-3 Schedule of Field Study in October 2016

Morning Afternoon 2nd (Sun) Narita - Incheon - Tashkent 3rd (Mon) ●Embassy of Japan ●MOH ●JICA ●WHO ◎MLIT’s Conference on Infrastructure 4th (Tue) ●MOH, Medical Facility Design ●Republican Blood Transfusion Bureau Center ●Institute of Hematology (hospital) 5th (Wed) ●Republican Blood Transfusion ●Blood center, the Republican Center Blood Transfusion Center Blood center, the 2-clinic of ●JETRO Tashkent Medical Academy 6th (Thu) Tashkent - Samarkand ●Private design firm ◎Samarkand blood center ●Accounting firm ●Republican Blood Transfusion Center 7th (Fri) Samarkand - Navoi ●Private hospital ◎Navoi blood center Navoi - Samarkand ●Republican Blood Transfusion Center 8th (Sat) Samarkand - Tashkent 9th (Sun) ●Team meeting 10th (Mon) Tashkent - Nukus ●Republican Blood Transfusion ◎MOH of Republic of Center Karakalpakstan Nukus - Tashkent ●Nukus blood center ●Equipment manufacturer agent 11th (Tue) ●Tashkent province blood center ●Republican Institute of Virology ◎Tashkent PNN center ●ADB 12th (Wed) ●Municipal hospital ●Equipment manufacturer agent ●Ministry of Economy 13th (Thu) ●MOH ●Uzbekistan Red Crescent ◎Private company (dairy product plant) 14th (Fri) ●Private company (pharmaceutical ●JICA plant) ●Embassy of Japan (courtesy call on the ambassador) Tashkent - 15th (Sat) - Incheon - Narita The ◎ mark signifies separate activities.

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Source: Study team

(3) Main outcomes By visiting the relevant facilities in Uzbekistan and having talks with local stakeholders, the study team established a shared understanding of the present situation and issues of Uzbek blood services. Also, the team consulted with authorities including MOH and implementing organization and confirmed the project scope and their opinions.

The results of discussions and evaluations were eventually compiled in a Minutes of Meeting (MOM) and agreed between the MOH representative and the study team leader.

Figure 2-3 Primary Contents of the MOM

- Mutual confirmation of goals 10% albumin: 4,000L/year 10% immune globulin: 240,000 doses/year Cryoprecipitate: 8,232 units/year (40 million units of blood coagulation factor VIII) *WHO’s recommended figures

- Confirmation of scope Construction of a GMP-compliant, sustainable plasma derivative plant Enhancement of blood collection, testing, production, storage and supply functions of each blood center Support in technological training for workers at the plasma derivative plant and blood centers

Source: Study team c) Second field study 1. Purpose The second field study trip was conducted to present the study progress, to explain the proposal from Japan and the estimate amount.

2. Study schedule

Table 2-4 Schedule of Field Study in December 2016

Morning Afternoon 13th (Tue) Narita - Incheon - (Kume, Tuchiya) - Tashkent 14th (Wed) ●Jurabek pharmaceutical plant (Numata) - Tashkent 9:00-11:00 ●JETRO 15:00-16:30 15th (Thu) ●Embassy of Japan 9:30-10:30 ●Republican Blood Transfusion Center ●Study team meeting 11:00-12:00 14:00-16:30 16th (Fri) ●MOH 10:00-11:30 ●Study team meeting, material preparation 17th (Sat) ●Study team meeting, material preparation 13:00-17:00 18th (Sun) ●Study team meeting, material preparation 13:00-17:00 (Ito) - Tashkent 19th (Mon) ●Republican Blood Transfusion Center ●Study team material preparation 10:00-11:00 ●Ministry of Finance 16:00-17:00 20th (Tue) ●Presentation to MOH 10:00-11:30 ●Embassy of Japan 15:00-16:00 Tashkent - 21th (Wed) - Incheon - Narita

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Source: Study team

3. Primary outcomes The study team presented a proposal developed in Japan after the first field study to MOH and the counterpart, the Republican Blood Transfusion Center, and discussed the proposal with the Ministry of Finance, which is the authority that grants approval for yen-loan projects.

The team also discussed with the Embassy of Japan and JETRO whether the political movement following the sudden death of President Karimov and the start of a new presidential administration could impact the project. d) Follow-up in Uzbekistan 1. Purpose After the second field study, the Uzbek office of the study team followed up with local stakeholders including MOH. They also reported results to and discussed with the Embassy of Japan and Uzbek office of JICA etc. as necessary.

2. Main discussions with Uzbek stakeholders  January 10, 2017: Explanation of the proposal and consultation with Abdunomon Sidikov, General Director Dept. of External Economic Activities  January 10, 2017: Explanation of the proposal and consultation with Rustam Yoldashev, Director of Republican Blood Center and other stakeholders  January 20 and 26, 2017: Explanation of the proposal and consultation with Jamshed Jabriyev, Rustam Yoldashev, and other stakeholders  February 3, 2017: Explanation of final proposal and consultation with Shukhrat, Vice Minister of MOH, Jamshed Jabriyev, Rustam Yoldashev, and other stakeholders

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Chapter 3 Justification, Objectives and Technical Feasibility of the Project

(1) Project Background and Significance

1) Project Background WHO recommends countries domestically produce blood products for transfusion and plasma derivatives in domestic formulation plants from human blood collected domestically. Following this recommendation, Uzbekistan has been striving to establish self-sufficiency in their blood product supply. In June 2015, the country formulated the “Complex Plan for Improvement of Blood Services in Republic of Uzbekistan” to deliberate appropriate measures. According to the plan, the country’s population is expected to reach 40 million by 2035, and this will necessitate (1) 4,000L albumin6, (2) 240,000 doses of immune globulin, and (3) 8,200 doses of cryoprecipitate.

Although Uzbekistan has developed and operated blood centers and a plasma product factory under the supervision of MOH, many of them were constructed in the 1970s and blood products produced in those facilities are not sufficient in both quality and quantity. For example, Uzbek production capacity of albumin is as small as 600L annually, which falls far short of 3,000L, the annual required amount for today’s 30-million population. The shortfall is currently filled by imports and this may possibly lead to a supply shortage depending on the country’s financial circumstances and the climates of exporting countries.

In 2015, MOH of Uzbekistan contacted stakeholders in Japan and explored the possibility of improving and rebuilding existing antiquated and deteriorated blood-service facilities and poor plasma derivative production functions of the country with support from the Japanese government. An Uzbek presidential order (No.4639) regarding an economic cooperation campaign was then issued by then President Karimov in the subsequent year 2016, which dictated the promotion of construction of a new plasma product factory with the support of Japan as part of the aforementioned complex plan for blood service improvements. This study was conducted in order to verify a project scope, targets, and scale for a feasibility study of the project.

2) Project Significance a) Project scope and targets The purpose of this project is to renew aged plasma derivative production functions in order to help the country to domestically satisfy its internal demands for plasma derivatives. The target facility is located within the Republican Blood Transfusion Center in the country’s capital Tashkent.

Through preliminary studies it has been found that the supply of raw material plasma would be far short of the required volume after the plasma product factory is rebuilt. Therefore, the proposed project will also commit to securing a stable supply of plasma and improving safety through infection control measures etc. b) Analysis of current situations and future prospects Due to the absolute shortage of current plasma derivative production capacity, the country has relied on imports. While the country’s population as of 2015 is 31.29 million, it is expected to grow to 40 million by 2035, which, according to the WHO’s recommendation, will require 4,000L of albumin, 240,000 doses for immune globulin for I.M. and 40 million units of blood coagulation factor VIII7 per year.

More importantly, the volume of donated blood (the raw material) is not sufficient, and the present ratio of blood donors in the country’s population, which is as low as 0.5% (n = 156,264 in 2015), should be increased to at least the WHO’s recommended ratio of 1.0%. (Refer to Figure 3-1 and Figure 3-2.)

6 WHO recommends reserves of 100L per one million people per year. 7 The Complex Plan for Improvement of Blood Services in the Republic of Uzbekistan set a goal to increase cryoprecipitate production; but, cryoprecipitate has been replaced by blood coagulation factor VIII in following with global healthcare trends. Therefore, this project deals with blood coagulation factor VIII instead of cryoprecipitate pursuant to an agreement with MOH.

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Figure 3-1 Changes in the Number of Blood Donors in Uzbekistan person 180,000 Donation number 160,000

140,000

120,000

100,000

80,000

60,000

40,000

20,000

0 year 2009 2010 2011 2012 2013 2014 2015

Source: Study team, based on MOH materials

Figure 3-2 Changes in Donated Blood and Plasma Volumes

Liter 90,000

80,000 Blood amount（L) 70,000 60,000 Fresh frozen plasma distributed to hospitals（L) 50,000 Plasma processed for 40,000 medicines（L) 30,000 20,000 10,000 0 year 2009 2010 2011 2012 2013 2014 2015 Source: Study team, based on MOH materials c) Expected effects and impact of the project If the self-sufficiency in the blood product supply in Uzbekistan is achieved through the proposed project, the supply of blood products would be stable and, consequently, there would be improvements to the treatment of Uzbek patients needing blood products. Also, the import cost burden on the country’s finances would be reduced and these positive influences would reach citizens who presently have to buy expensive imported medicines.

In addition, as discussed in Chapter 1, Uzbek blood services have faced many issues, and a considerable portion of such issues are related to safety. The proposed project will aim to improve these safety issues as much as possible. Specifically, the risk of transfusion-transmissible diseases can be mitigated through the new development of an efficient, GMP-compliant, and safety-conscious plasma product factory and through the introduction of NAT. d) Probable scenario without project implementation and its consequences Granting that this project will not be implemented and the current situation will remain unchanged, the limited

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size and quality of the country’s production capacity will result in continued dependence on imported plasma derivatives. Also, the present facilities are not enough to ensure the stable supply and safety of blood products and may possibly result in pharmaceutical accidents in the future. Thus, expected benefits from the implementation of this project will be significant for Uzbek nationals.

(2) Basic Policies and the Determination of Project Details

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(3) Project Overview

1) Improvement of blood services: securing of raw material plasma required for production of sufficient blood products The Uzbek population is expected to reach 40 million by 2035. To achieve WHO’s recommendation of 1.0% donor ratio in the population, the Uzbek blood service sector will need 400,000 donors by 2035. In other words, a 2.7-fold increase of today’s number of blood donors (approx. 150,000) must be achieved. (Refer to Figure 3-3 Target Growth of Donors.)

The volume of plasma for plasma derivatives production from 400,000 donors is approximately 75,000L; 46,000L and 29,000L of which are used for blood products for transfusion and plasma derivatives, respectively. (Refer to Figure 3-4 Projected Increase of Blood Donation and Plasma for Derivatives Production.)

Figure 3-3 Target Growth of Donors

Person 450,000 献血者数 Numbers of donors 400,000 (人）

350,000

300,000 250,000 200,000 150,000

100,000

50,000 0 1年後Year 1 5年後Year 5 11年後Year 11 18年後Year 18

Source: Study team

Figure 3-4 Projected Increase of Blood Donation and Plasma for Derivatives Production

Liter

160,000 献血量Amount of Blood 140,000 Donation (L) (L) 120,000 分画製剤用Amount of Plasma for 100,000 血漿（DerivativesL) Production (L)

80,000 60,000

40,000 20,000

0 年後年後年後年後 Year1 1 Year5 5 Year11 11 Year18 18

Source: Study team

Possible measures to increase the number of non-remunerated blood donors and to process an increased volume of donated blood are as follows: a) Activities to promote blood donations In order to increase the volume of donated blood, national efforts and increased awareness of blood donations

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among the nationals are critical. Listed below are the possible measures to achieve this. 1. Activities to promote blood donations through education institutions 2. Distribution of information materials in video, poster and other formats to various strata of the country 3. Media promotion activities b) Blood collection, testing, production and supply Equipment and manpower to process an increased volume of donated blood will be necessary in the future. 1. Blood collection: bloodmobiles, donation rooms and whole blood collection devices 2. Testing: blood cell counters, full-auto blood grouping equipment and infection testers (NAT, etc.) 3. Production (blood products for transfusion): automated production equipment 4. Supply: cooling containers

Target facilities are the Republican Blood Transfusion Center in Tashkent City, which is the primary target of this project, and regional blood transfusion stations: the Andizhan Blood Transfusion Station, the Samarkand Blood Transfusion Station, and Nukus Blood Transfusion Station (the Republic of Karakalpakstan). Through the project, the regional facilities are expected to serve as the regional basis to provide technical support to blood centers in neighboring provinces.

Figure 3-5 Bloodmobile (image) Figure 3-6 Donation room (image)

Source: Japan Red Cross website Source: Japan Red Cross website

Figure 3-7 NAT

Source: manufacturer’s website

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The land is currently a forested land behind the Republican Blood Transfusion Center. (See the photos below.)

Figure 3-8 Front of Figure 3-9 Entrance of the Republican Blood Transfusion Center the Republican Blood Transfusion Center

Source: Pictures taken by the study team (October 2016)

Figure 3-10 Construction Land behind the Republican Blood Transfusion Center

Source: Picture taken by the study team (October 2016)

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b) Construction plan of the plasma product factory

Table 3-1 Outline of New Plasma Product Factory Building area 1,800m2 Gross floor area 3,600m2 Structure 2-story RC Finishing of main Floor: epoxy coating building parts Dust-proof painting (machine rooms) PVC tiles (office rooms) Walls: heat-insulating sandwich panels Gypsum boards, etc. Ceiling: heat-insulating sandwich panels Gypsum boards, rock-wool, acoustic boards, etc. Clean room Class 100,000 to 1,000 specifications Source: Study team

Figure 3-11 New Factory Layout (draft)

New plasma derivative plant

Property border

Existing blood center building

Entrance

Parking lot

Source: Study team

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Figure 3-12 Plasma Product Factory 1st Floor Plan

Figure 3-13 Plasma Product Factory West Elevation

Source: Study team

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c) Equipment introduction plan for the plasma product factory Main rooms and equipment items of the plasma product factory are listed below.

Table 3-2 Main Equipment Items for Plasma Product Factory

Room Equipment Maker Description (usage, etc.) CIP room Boiler room, etc. Brine room Reagent water room Freeze-dry room Bulk pasteurization room Centrifugal separator room Fractionation room Autoclave Bottle-washing room, dispensing room Chemical test room Microbial test room Chemical test room Chemical test room Microbial test/growth test room Quality test room QC cleaning room

Source: Study team

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Along with the deployment of new blood collection devices and analysis equipment at blood centers, guidance on test management and new procedures will also be necessary.

These support, guidance and human resource development activities will be conducted for 4 years, during which a technology transfer and the establishment of training systems etc. are expected to be completed. b) Improvement of blood services: increased blood safety Above all, improvement of blood safety requires ‘voluntary and non-remunerated donation of blood.’ So, WHO has set a goal of making the ratio of ‘voluntary and non-remunerated blood donation’ 100% in each country by 2020. However, the ratio in Uzbekistan is still as low as 40% as of 2015. Transition from ‘blood donation for family’ to ‘voluntary and non-remunerated blood donation’ is essential for Uzbek blood services.

In order to reduce the risk of transfusion-transmissible diseases and improve the blood safety, not only hardware support, e.g., deployment of testing equipment such as NAT, but also software support for management and human resource development practices are important. In blood collection practices, management of blood collection standards, interviews, and donors (identity check) is critical, while sample storage and look-back studies are after blood collection. Guidance by Japanese experts on these matters is included in the project scope. c) Plasma product factory As the new factory will adopt a mass-production system with new production equipment, it will be necessary to define staff organization and a division of roles, and implement training measures to familiarize staff with new procedures. Compliance with internationally accepted standards, i.e., GMP (Good Manufacturing Practices), is also essential to ensure exportable quality of plasma derivatives. Thus, experts will be dispatched from Japan to develop human resources and provide guidance on maintenance systems, facility operations and production practices for 4 years after completion of the new factory.

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Table 3-3 Breakdown of Estimated Project Cost for Reinforcement of Blood Services

1 Main equipment items to be deployed to blood centers - Bloodmobiles: 14 blood centers - Donation rooms: 2 locations in Tashkent City - Whole blood collection devices: 14 locations - Automated blood grouping equipment: 4 locations - Automated biochemical analyzers: 4 locations - Automated hematology analyzers: 4 locations - NAT (nucleic acid amplification tester): 4 locations - Trucks and containers for transportation 15,066,849 USD 2 Reagents, consumables and equipment maintenance for 4 years after equipment introduction 8,766,664 USD 3 Dispatch of Japanese experts (blood donation promotion, test management, technological instruction, management guidance, human resource development and training etc.) 4 years after equipment introduction: about 219 experts per month in total 2,415,190 USD Total 26,248,703 USD

Source: Study team

Table 3-4 Breakdown of Estimated Project Cost Plasma Product Factory Construction

1 Factory building construction work Gross floor area: 3,600m2; RC structure; two-story Including building equipment (boiler, compressor, generator, transformer, A/C, piping and valves etc.) 19,800,000 USD 2 Plasma product factory Various tanks, heat exchangers, pharmaceutical water equipment, freeze-drying machines, centrifugal separators, autoclaves, serial dispensing machines, control systems and instrumentation etc. 14,478,745 USD 3 Consumables and maintenance work for 4 years after completion 1,751,841 USD 4 Japanese expert dispatch (blood donation promotion, test management, technological instruction, management guidance, human resource development and training etc.) 4 years after completion: 84 experts per month in total 6,296,749 USD Total 42,327,335 USD 1 USD = 117.382 JPY (as per JICA’s settlement rate for FY2016 (as of January 2017)) Source: Study team

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(4) Necessary Evaluation of the Project

1) Demand Forecast As mentioned earlier, WHO has defined recommended production volume of plasma derivatives (the target products of this project) relative to national population. For this project the recommendation of WHO recommendation can be assumed to be fulfilled as a demand. In interviews with local medical institutes using blood products, representatives of the institutes explained how they suffer shortages of blood products; it was indicated that currently they can administer blood products only to patients with an urgent need for such products, and in many cases expensive imported products have to be used. Thus, a stable source of blood products is imperative in the country.

On the other hand, a qualitative assessment of the issues above is necessary for the future. While MOH looks to export surplus products to neighboring countries, additional studies are required to verify blood product demands and the distribution situations of neighboring countries and administrative commitment to blood services in each country, so as to provide a more accurate demand forecast, and further elaborate the project scope.

2) Consideration of Division of Roles for Implementing of the Project An appropriate division of roles among Uzbek and Japanese stakeholders is an enabling factor of the proposed project. On the Japanese side, there must be selection of the appropriate entities in charge of new factory development, equipment procurement and introduction, and operational and technological guidance etc.

Matters requiring further evaluation regarding roles to be taken by Uzbek stakeholders include recruitment of human resources and the constant securing of an operating budget. While local human resources and a budget were evaluated in this study, further studies are required from mid- and long-term perspectives.

As of writing of this report, the project scope is expected to be divided as shown in the figure below.

Table 3-14 Division of Project Scope

Source: MOH

3) Evaluation of Technological Practices for Plasma Derivative Production Technologies to be introduced through production facilities and equipment in this project are not particularly advanced but commonly-adopted across the world, especially in developed countries. Therefore, no special considerations are required in terms of technology.

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On the other hand, blood services in Japan are highly recognized for their safely and efficiency; and their experience, know-how and human resource development techniques etc. are the particular strengths of Japan. However, blood services in Japan are operated by a small number of entities and human resources with sufficient experience and know-how are relatively limited in comparison with other sectors. Therefore, there is a need for preliminary arrangements to supply the appropriate human resources, especially for operational guidance, and to continuously maintain the quality of guidance.

In regards to the dispatching of experts, coordination among involved organizations is required for the future; for example, consultants may have to take a mediator role among blood service providers and derivative product manufacturers to obtain their cooperation. Thus, detailed studies on burden sharing (including on-site staff training in Japan) and associated risks are required.

4) Acquisition of Approval and Licenses Required for Plasma Product Factory Construction For construction of the plasma product factory, the relevant approval and licenses must be obtained pursuant to Uzbek rules. MOH’s internal organization called the “Design Institute” possesses experts in design, electric works, fire prevention, healthcare and medication etc., and grants such approvals and licenses, and there is mandatory conformance with the conditions required by the organization. The State Committee’s approval and the approval of fire protection applications and environmental measures will also be required. Information regarding all required approvals must be gathered in the future.

As of this study, the following items regarding specific design approvals and licenses to be obtained from the Design Institute were confirmed.  The offset distance between the property border and a building must be at least 20-25m.  The offset distance between buildings must be at least 15m. However, a link corridor between buildings is allowed.  The offset distance from a transformer must be at least 25m.  Spaces (roads) of sufficient width to allow a fire-fighting vehicle to enter must be made available around a building. Windows must be at a height of 5-8m from the ground to allow a fire ladder to reach.  Infrastructural lines, such as electric lines and piping, must not be routed beneath the building.  Public infrastructural facilities will be provided after demands for electricity, gas, water, sewage and hot water etc. are calculated and submitted.  Dual line power reception system and an emergency generator are already available on the land.  Clean rooms required by GMP shall be fire-proof and classified into appropriate zones.  The city planning law and building standard law are stipulated based on standards called SNIP. Also, construction rules such as KMK and hygiene regulations called SanPin shall be observed.  Building and land planning drawings at a 1:500 scale shall be submitted during the application process.

Other required approvals and licenses related to the construction work are listed in the table below. For implementation of the project, the following approvals and licenses shall be obtained.

Table 3-5 Approvals and Licenses Related to Construction Work

Administrative bodies Approval/license type Office in charge in charge Property and Land Registration Property and Land 1 Issuance of “land use permit” Office Registration Office Property and Land Registration Property and Land 2 Acquisition of “land use permit” Office Registration Office National Design and National Design and Construction 3 Acquisition of “design license” Construction Committee Committee Approval of “environmental National Nature Conservation 4 impact assessment” Committee National Design and Construction 5 “Design approval” Committee “Approval of hygiene and National Hygiene and Plague 6 anti-disease measures” upon MOH Office design approval

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“Fire-fighting and Ministry of Internal 7 fire-prevention approval” upon National Fire Prevention Office Affairs design approval Uzbekenergo (national 8 “Utility connection approval” Municipal electric company company) Municipal waterworks department Tashkent City Municipal gas company Tashkent City Municipal heat supply company Tashkent City National Design and Construction 9 “Construction permit” Committee

Source: MOH

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Chapter 4 Evaluation of Environmental and Social Impacts

(1) Analysis of Current Environmental and Social Situations

1) Current Status of the Land for a New Plasma Product Factory With the approval of MOH already being obtained, the premises of the Republican Blood Transfusion Center, where there is an existing plasma product factory, was determined as a site for the new plasma product factory. For this project, therefore, there will be no need to secure a new factory site nor for the relocation or resettlement of existing commercial facilities or residents. A part of the existing blood center operations must be limited during the construction period due to construction vehicle traffic and the bringing in of construction materials/equipment to implement the project. For the same reason, safety, anti-contamination, anti-noise and anti-vibration measures, etc. are required in and around the premises of the Republican Blood Transfusion Center in order to minimize the impact on the environment.

As far as revealed by the field studies, the sewers are used for both general wastewater and sewage, which are discharged to a public sewage system via septic tanks. Discharge of industrial waste water into the public water system is pursuant to the Presidential Order No.11, dated February 3, 2010, and there are not national standards regarding waste water quality in Uzbekistan. Therefore, effluent generated in medicine production such as waste alcohol from the plasma product factory is discharged to the public sewage system after inactivation under the supervision of Tashkent City pharmaceutical officers, as per the SpanPiN standards that have been applied since the Soviet era.

The table below is the SanPiN Standard 0317-15 regarding waste disposal, in which medical wastes are classified into Class G, the 4th highest class among the 5 hazard classes. As it is allowed to discharge effluent from medicine production to the public sewage system after disinfection, and there are no national standards regarding waste water disposal, the means of waste fluid disposal currently used in the existing factory can satisfy the administrative requirements at the new factory, too.

Table 4-1 Waste Hazard Classification of the SanPiN Standard 0317-15

No. Hazard class Description of the waste composition 1. Class A Non-hazardous wastes, which have no contact with body liquids of patients or with Non-hazardous patients with transmissible diseases; non-toxic wastes: food wastes of all hospital departments except the infections department; furniture, inventory and non-working diagnostic equipment not containing toxic elements, non-infected paper, construction waste, etc. 2. Class B Hazardous (risky) wastes: potentially infected wastes; materials and tools polluted hazardous with body liquids of patients, pathology wastes, wastes from infection departments including food wastes, wastes of microbiological laboratories working with microbes of group 3 and 4; biological wastes of vivaries 3. Class V All materials contacting with patients with extremely dangerous infections; wastes extremely from microbiological laboratories working with microbes of group 1 and 2; hazardous tuberculosis departments wastes; wastes from patients with anaerobic infection 4. Class G Expired medicines; wastes of medicines and diagnostic reagents; disinfection wastes close to chemicals, cytostatics and other chemical preparations; mercury containing articles, industrial wastes instruments and equipment 5. Class D All kinds of wastes containing radioactive components with content of radioactive wastes radionuclides exceeds admissible levels established by radiation safety rules Source: MOH

2) Current Status of Blood Centers It was confirmed that no specialized medical waste disposal mechanism is used at the Samarkand Blood Center and solid medical wastes are incinerated in a private incinerator in the center’s premises.

As incineration may cause significant smoke pollution to neighboring residents and commercial facilities, countermeasures such as the use of low-emission fuel should be considered. While SanPiN-compliant disinfection process for solid medical wastes was not observed during the field tour, the disinfection of Class G solid medical wastes will be necessary for the project site as is being done in Tashkent City.

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(2) Positive Environmental Impact of the Project

This project does not intend to develop an energy infrastructure and there will be no positive environmental impact, such as reduction of pollutants or greenhouse gas emissions.

(3) Environmental and Social Impact of the Project

1) Impact on Ambient Natural Environment The site is located in an urban area and an old factory building already exists in the site. Around the site there are no ecosystem, cultural heritages, and minority ethnic/indigenous groups that will be adversely affected by factory construction and the production of plasma derivatives. No factors conflicting with the natural environment or specific issues that may lead to social and environmental impact were found during the field tour.

After construction of the plasma product factory, medical waste fluid will be discharged as it is today, but compliance with the SanPiN standards can be secured through the discharging to the public sewage system after inactivation treatment. As waste alcohol generated through an alcohol distillation process is also treated in the same way, there will be unlikely any significant impact on the surrounding natural environment arising out of waste fluid treatment.

Thus, the potential environmental impact from implementing the project can be concluded as follows. a) Noise and vibration Countermeasures against noise and vibration arising out of the construction work on the plasma product factory will be implemented to minimize the impact on neighboring residents and commercial facilities. For example, low-noise pile drivers and heavy machinery will be used, where noise and vibration from bolting and ground excavation are expected.

Noise and vibration produced from certain equipment, such as the vibration of production equipment and the noise of sirens of emergency vehicles coming in and out of the blood center, require appropriate considerations; for example, installation positions and operating time should be adjusted to reduce negative impacts. b) Sewage treatment As mentioned above, effluent generated in medicine production such as waste alcohol from the plasma product factory should be appropriately discharged to the public sewage system after inactivation treatment pursuant to the Presidential Order No.11 and the SpanPiN standards to minimize negative impact on the environment. c) Dust and smoke Periodic inspection and maintenance of construction vehicles and machines are necessary to reduce air pollution during the construction period. Water spraying on the construction site is also required to minimize dust dispersion.

For smoke exhaust, the existing factory also disposes of solid medical wastes in an incinerator within the blood center’s premise. However, the new factory should use fuel that generates less smoke to minimize negative impact on the environment. d) Wastes Wastes from the plasma product factory operations and the blood center must be divided into general wastes and medical wastes. Thus, pursuant to the SanPiN standards, medical wastes must undergo an appropriate disinfection treatment by disinfectant solution, pressurized steam or microwaves etc. to minimize the negative impact on the environment. e) Soil contamination Measures to avoid soil and groundwater contamination caused by construction waste water and leaching etc. must be employed. Any hazardous waste fluid generated during construction, such as waste oil and oil paint, must be contained in reservoir tanks to prevent them from being mixed or penetrating into ground soil, and such fluid must be carried out of the site for disposal.

2) Impact on Social Environment A land for the new plasma product factory is secured within the premise of the Republican Blood Transfusion

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Center where there is currently an old factory. Therefore, there will be no need for movement of residential areas. Also, the proposed plasma product factory is relatively small in size, and no significant modification of a land form or geological structure around the site is expected for construction.

An environmental impact of construction work of the factory (noise, vibration, dust, exhaust gas, sewage, wastes etc.) can be mitigated or eliminated by appropriate measures. The table below lists response measures for each item of the environmental impact checklist. Particularly, appropriate measures to reduce noise, vibration, water contamination, dust, exhaust gas and wastes etc. in construction work must be implemented to minimize impact on nearby areas.

There will be no fresh impact on blood services because blood services are not a business new to the country.

Table 4-2 Environmental Impact Checklist

Environmental Yes: Y Confirmation of Environmental Considerations Category Main Check Items Item No: N (Reasons, Mitigation Measures) 1 Permits and (a) Have EIA reports been already prepared in official process? (a)N (a)Not yet prepared, need to make an EIA report at prior to execution of a project Explanation (b) Have EIA reports been approved by authorities of the host country's government? (b)N (b)Not yet authorized, neeed to get authorizatuon of government prior to execution of a (1) EIA and (c) Have EIA reports been unconditionally approved? If conditions are imposed on the (c)N project Environmental approval of EIA reports, are the conditions satisfied? (d)N (c)EIA report not yet prepared, need further investigation Permits (d) In addition to the above approvals, have other required environmental permits been (d)Permit not yet obtained, need further investigation obtained from the appropriate regulatory authorities of the host country's government? (a) Have contents of the project and the potential impacts been adequately explained to the (a)N (a)Not necessary, since plant is planned to build in exisiting premises of MOH (2) Explanation to Local stakeholders based on appropriate procedures, including information disclosure? Is (b)N (b)Not necessary, since plant is planned to build in exisiting premises of MOH the Local understanding obtained from the Local stakeholders? Stakeholders (b) Have the comment from the stakeholders (such as local residents) been reflected to the project design? (3) Examination of (a) Have alternative plans of the project been examined with social and environmental (a)N (a) No alternative plans necessary Alternatives considerations? 2 Pollution a) Do air pollutants, (such as sulfur oxides (SOx), nitrogen oxides (NOx), and soot and dust) (a)Y (a)Local Emission Standard（Comply to SanPiN Standard） Control emitted from the proposed infrastructure facilities and ancillary facilities comply with the (b)N/A (b)No accommodation facility (1)Air Quality country's emission standards and ambient air quality standards? Are any mitigating measures taken? (b) Are electric and heat source at accommodation used fuel which emission factor is low (a) Do effluents or leachates from various facilities, such as infrastructure facilities and the (a)Y (a)Local Emission Standard（Comply to SanPiN Standard） (2)Water Quality ancillary facilities comply with the country's effluent standards and ambient water quality standards? (a) Are wastes from the infrastructure facilities and ancillary facilities properly treated and (a)Y (a)Local Emission Standard（Comply to SanPiN Standard） (3)Wastes disposed of in accordance with the country's regulations? (4)Soil (a) Are adequate measures taken to prevent contamination of soil and groundwater by the (a)Y (a) Discharged to the public sewage system after inactivation treatment Contamination effluents or leachates from the infrastructure facilities and the ancillary facilities? (5)Noise and (a) Do noise and vibrations comply with the country's standards? (a)Y (a)Noise may occur during construction stage, but not after starting operation of a factory Vibration (a) In the case of extraction of a large volume of groundwater, is there a possibility that the (a)N/A (a)Not planned to use groundwater (6)Subsidence extraction of groundwater will cause subsidence? (7)Odor (a) Are there any odor sources? Are adequate odor control measures taken? (a)N (a)Should be no odor sources 3 Natural (a) Is the project site or discharge area located in protected areas designated by the country's (a)N/A (a)It is not a protected area (1) Protected Environment laws or international treaties and conventions? Is there a possibility that the project will affect Areas the protected areas? (a) Does the project site encompass primeval forests, tropical rain forests, ecologically (a)N (a)Not included valuable habitats (e.g., coral reefs, mangroves, or tidal flats)? (b)N (b)Not included (b) Does the project site encompass the protected habitats of endangered species designated (c)N/A ©No planned to use groundwatwer by the country's laws or international treaties and conventions? (d)N/A (d)Not plannedf to use surface water, groundwater (c) Is there a possibility that changes in localized micro-meteorological conditions, such as (2) Ecosystem solar radiation, temperature, and humidity due to a large-scale timber harvesting will affect the surrounding vegetation? (d) Is there a possibility that the amount of water (e.g., surface water, groundwater) used by the project will adversely affect aquatic environments, such as rivers? Are adequate measures taken to reduce the impacts on aquatic environments, such as aquatic organisms? (a) Is there a possibility that hydrologic changes due to the project will adversely affect (a)N (a)Discharged to the public sewage system after inactivation treatment(comply to SanPin (3) Hydrology surface water and groundwater flows?。 Standard) (a) Is there a possibility the project will cause large-scale alteration of the topographic features (a)N/A (a) (4) Topography and geologic structures in the project site and and Geology surrounding areas? 4 Social (a) Is involuntary resettlement caused by project implementation? If involuntary resettlement (a)N/A (a)Not necessary, since,plant is planned to build in exisiting premises of MOH Environment is caused, are efforts made to minimize the impacts caused by the resettlement? (b)N/A (b) (b) Is adequate explanation on compensation and resettlement assistance given to affected (c)N/A (c) people prior to resettlement? (d)N/A (d) (c) Is the resettlement plan, including compensation with full replacement costs, restoration of (e)N/A (e) livelihoods and living standards developed based on socioeconomic studies on resettlement? (f)N/A (f) (d) Is the compensations going to be paid prior to the resettlement? (g)N/A (g) (e) Is the compensation policies prepared in document? (h)N/A (h) (1) Resettlement (f) Does the resettlement plan pay particular attention to vulnerable groups or people, (i)N/A (i) including women, children, the elderly, people below the poverty line, ethnic minorities, and (j)N/A (j) indigenous peoples? (g) Are agreements with the affected people obtained prior to resettlement? (h) Is the organizational framework established to properly implement resettlement? Are the capacity and budget secured to implement the plan? (i) Are any plans developed to monitor the impacts of resettlement? (j) Is the grievance redress mechanism established? (a) Is there a possibility that the project will adversely affect the living (a)N (a)There will be no affect to the living conditions of inhabitants, since the project will be (2) Living and conditions of inhabitants? Are adequate measures considered to reduce executed with in existing premises of MOH Livelihood the impacts, if necessary? (a) Is there a possibility that the project will damage the local (a)N (a)There will be no affect to the the local archeological, historical, cultural, and religious archeological, historical, cultural, and religious heritage? Are adequate heritage, since the project will be executed with in existing premises of MOH (3) Heritage measures considered to protect these sites in accordance with the country's laws? (a) Is there a possibility that the project will adversely affect the local (a)N (a)No affect to the local landscape, since project will be executed inside existing premises of landscape? Are necessary measures taken? (b)N MOH (4) Landscape (b) Is there a possibility that landscape is spoiled by construction of highrise (b)No affect to the landscape, since the height of planned building is limited buildings such as huge hotels? (a) Are considerations given to reduce impacts on the culture and lifestyle (a)N/A (a)No imapct due to a existing premises (5) Ethnic of ethnic minorities and indigenous peoples? (b)N/A (b)No affect to imapct ethnic minorities and indigenous peoplesdue, since project will be Minorities and (b) Are all of the rights of ethnic minorities and indigenous peoples in executed with in existing premises of MOH Indigenous Peoples relation to land and resources respected?

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4 Social (a) Is the project proponent not violating any laws and ordinances associated with the working (a)Y (a)Necessary action to be taken during project constructon and training procedure Environment conditions of the country which the project proponent should observe in the project? (b)Y (b)Necessary action to be taken during project constructon and training procedure (b) Are tangible safety considerations in place for individuals involved in the project, such as (c)Y (c)Necessary measures should be implemented during project constructon and training the installation of safety equipment which prevents industrial accidents, and management of (d)Y procedure (6) Working hazardous materials? (d)Necessary measures should be implemented during project constructon and training Conditions (c) Are intangible measures being planned and implemented for individuals involved in the procedure project, such as the establishment of a safety and health program, and safety training (including traffic safety and public health) for workers etc.? (d) Are appropriate measures taken to ensure that security guards involved in the project not to violate safety of other individuals involved, or local residents? 5 Others (a) Are adequate measures considered to reduce impacts during construction (e.g., noise, (a)Y (a)All adequate measures related to noise, vibrations, turbid water, dust, exhaust gases, and vibrations, turbid water, dust, exhaust gases, and wastes)? (b)N wastesconsidered should be considered to reduce impacts during construction (1) Impacts during (b) If construction activities adversely affect the natural environment (c)N (b)There will be no constrcution activities which will affect the natural environment Construction (ecosystem), are adequate measures considered to reduce impacts? (c)There will be no constrcution activities which will affect the natural environment, while we (c) If construction activities adversely affect the social environment, are will take a proper measures to reduce noise, vibrations, turbid water, dust, exhaust gases, and adequate measures considered to reduce impacts? wastes, during construction stage (a) Does the proponent develop and implement monitoring program for the environmental (a)Y items that are considered to have potential impacts? (b)N (b) What are the items, methods and frequencies of the monitoring program? (c)N (2) Monitoring (c) Does the proponent establish an adequate monitoring framework (organization, personnel, (d)N equipment, and adequate budget to sustain the monitoring framework)? (d) Are any regulatory requirements pertaining to the monitoring report system identified, such as the format and frequency of reports from the proponent to the regulatory authorities? 6 Note (a) Where necessary, pertinent items described in the Roads, Railways and Bridges checklist (a)N/A (a) Reference to should also be checked (e.g., projects including access roads to the infrastructure facilities). (b)N/A (b) Checklist of Other (b) For projects, such as installation of telecommunication cables, power line towers, and Sectors submarine cables, where necessary, pertinent items described in the Power Transmission and Distribution Lines checklists should also be checked. Note on Using (a) If necessary, the impacts to transboundary or global issues should be confirmed (e.g., the (a)N/A (a) Environmental project includes factors that may cause problems, such as transboundary waste treatment, acid Checklist rain, destruction of the ozone layer, or global warming). 1) Regarding the term “Country's Standards” mentioned in the above table, in the event that environmental standards in the country where the project is located diverge significantly from international standards,appropriate environmental considerations are required to be made. In cases where local environmental regulations are yet to be established in some areas, considerations should be made based on comparisons with appropriate standards of other countries (including Japan's experience). 2) Environmental checklist provides general environmental items to be checked. It may be necessary to add or delete an item taking into account the characteristics of the project and the particular circumstances of the country and locality in which the project is located.

Source: Study team

(4) Overview of Environmental and Social Impact Related Laws and Regulations of the Host Country and Actions Required for Compliance

1) Uzbek Laws and Regulations Related to Environmental and Social Impact The key laws and regulations applicable to environmental and social impacts are the Presidential Order No.491, dated December 31, 2001 (amended in 2005 and 2009), the Presidential Order No.11, dated February 3, 2010, and the SanPiN standards. The Presidential Order No.491 formulated the Regulation on State Environmental Expertise (SEE), which requires the implementation of Environmental Impact Assessment (EIA). Results of this assessment are evaluated by governmental bodies in charge of SEE. The EIA procedure comprises 3 steps, and EIA documentation is required for each step.

As shown in Table 4-1, the SanPiN standards define 5 hazard class of wastes. Medical wastes of the plasma product factory, such as waste alcohol, are classified into Class B and required to discharge after inactivation treatment.

(5) Necessary Actions of the Host Country for Realization of the Project

Prior to implementing the project, an EIA must be conducted in accordance with the Regulation on State Environmental Expertise (SEE). Medical waste disposal and sewage treatment etc. in compliance with local environmental standards, SanPiN standards, must be performed during the project period.

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Chapter 5 Financial and Economic Evaluation

(1) Project Cost Estimate

1) New Plasma Product Factory a) Land condemnation cost The land for the new plasma product factory is a part of the premises of the Republican Blood Transfusion Center, owned by MOH. Therefore, there will be no cost for land condemnation. b) Factory construction material and equipment cost The total estimated cost for factory construction, equipment, operation and maintenance management, and training is 42,327,335 USD (approx. 4.97 billion JPY) as shown in Table 5-1 below.

Table 5-1 Project Cost for Plasma Product Factory Construction

NO Description Project cost (in USD) 1 Factory building construction work Gross floor area: 3,600m2; RC structure; two-story Including building equipment (boiler, compressor, generator, transformer, A/C, piping and valves, etc.) 19,800,000 USD 2 Plasma product factory Various tanks, heat exchangers, pharmaceutical water equipment, freeze-drying machines, centrifugal separators, autoclaves, serial dispensing machines, control systems and instrumentation etc. 14,478,745 USD

3 Consumables and maintenance work for 4 years after completion 1,751,841 USD 4 Dispatching of Japanese experts (blood donation promotion, test management, technological instruction, management guidance, human resource development and training etc.) 6,296,749 USD 4 years after completion: 84 experts per month in total Total 42,327,335 USD 1 USD = 117.382 JPY (as per JICA’s settlement rate for FY2016 (as of January 2017))

Source: Study team c) Consulting fees and general management costs etc. Consulting fees and general management costs etc. shall be included in the construction cost.

2) Blood Centers a) Land condemnation cost The project scope in relation to the existing Republican Blood Transfusion Center is the introduction of bloodmobiles and test equipment and the center is MOH’s facility. Therefore, there will be not cost for land condemnation. Similarly, the project scope for regional blood centers only involves the introduction of equipment to existing facilities and there will be no cost for land condemnation. b) Equipment cost The total estimated cost of blood center equipment introduction including bloodmobiles, NAT equipment, test equipment, operation and maintenance management, and training is 26,248,703 USD (approx. 3.08 billion JPY) as shown in Table 5-2 below. The estimated cost includes the introduction and installation of test equipment and donation rooms in the 3 regional cities.

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Table 5-2 Project Cost for Blood Center Equipment Introduction 1 Main equipment items to be deployed to blood centers - Bloodmobiles: 14 blood centers - Donation rooms: 2 locations in Tashkent City - Whole blood collection devices: 14 locations - Automated blood grouping equipment: 4 locations - Automated biochemical analyzers: 4 locations - Automated hematology analyzers: 4 locations - NAT (nucleic acid amplification tester): 4 locations - Trucks and containers for transportation 15,066,849 USD 2 Reagents, consumables and equipment maintenance for 4 years after equipment introduction 8,766,664 USD 3 Japanese expert dispatch (blood donation promotion, test management, technological instruction, management guidance, human resource development and training etc.) 4 years after equipment introduction: about 219 experts per month in total 2,415,190 USD Total 26,248,703 USD 1 USD = 117.382 JPY (as per JICA’s settlement rate for FY2016 (as of January 2017)) Source: Study team

3) Total Project Cost The total project cost is estimated to be 68,576,038 USD (approx. 8.05 billion JPY) as detailed in the Table 5-3 below.

Table 5-3 Total Project Cost

Item Project cost (in USD) Project cost (in JPY)

Project cost for plasma product 42,327,335 4,968,467,237 factory construction Project cost for blood center 26,248,703 3,081,125,256 equipment introduction Total project cost 68,576,038 8,049,592,493

Source: Study team

(2) Summary of Preliminary Financial and Economic Analysis Results

1) Financial Analysis In this subsection, the feasibility of the proposed project is analyzed from a financial point of view. Specifically, there is a comparison between the benefit expected to grow through the project (income from derivatives) and the project cost (for construction, equipment, operations, maintenance and management etc.). a) Performance metrics 3 metrics are used for this evaluation: net present value (NPV), benefit per cost (B/C) and financial internal rate of return (FIRR). b) Preconditions  Life of buildings and equipment shall be assumed to be 40 years and 20 years, respectively. Therefore, equipment shall be renewed after 20 years from implementation. No salvage value of both buildings and equipment shall be considered.  The analysis period shall be 40 years.  1% of facility price and 5% of equipment price shall be accounted as maintenance and management expenses

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every year from the second year after the project implementation.  It shall be assumed that wages for facility staff are all borne by MOH. (MOH’s capital)  Use of STEP yen loan with an interest rate 0.1%, a 40-year redemption period and a 10-year deferment period shall be assumed.  The blood derivative production volume shall be assumed to be as indicated in Table 5-4, based on which the project benefits shall be calculated.  The following exchange rates shall be used. 1 USD = 117.382 JPY 1 UZS = 0.037020 JPY (as per JICA’s settlement rate for FY2016 (as of January 2017))

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Table 5-4 Expected Changes in Plasma Derivative Production Volume

Plasma fractionation formulation production volume forecast

predicted Albumin amount 10% Alubmin 10% Passed population Plazma amount recommended value Factor Ⅷ product Immunoglobulin years （million (L) for the population (unit) volume(L) (dose：3ml） person）（L)

1 32.21 3,000 3,221 750 37,500

2 32.64 4,000 3,264 1,000 50,000

3 33.07 6,000 3,307 1,500 75,000

4 33.51 9,000 3,351 2,250 112,500 1,000,000

5 33.94 13,000 3,394 3,250 162,500 2,437,500

6 34.37 19,000 3,437 4,750 237,500 3,562,500

7 34.80 22,000 3,480 5,500 275,000 4,125,000

8 35.24 24,000 3,524 6,000 300,000 4,500,000

9 35.67 25,000 3,567 6,250 312,500 4,687,500

10 36.10 25,933 3,610 6,483 324,164 4,862,453

11 36.54 26,244 3,654 6,561 328,051 4,920,771

12 36.97 26,555 3,697 6,639 331,939 4,979,088

13 37.40 26,866 3,740 6,717 335,827 5,037,406

14 37.84 27,177 3,784 6,794 339,715 5,095,724

15 38.27 27,488 3,827 6,872 343,603 5,154,041

16 38.70 27,799 3,870 6,950 347,491 5,212,359

17 39.13 28,110 3,913 7,028 351,378 5,270,677

18 40.00 28,732 4,000 7,183 359,154 5,387,312

19 40.43 29,043 4,043 7,261 363,042 5,445,629

20 40.87 29,354 4,087 7,339 366,930 5,503,947

21 41.30 29,665 4,130 7,416 370,818 5,562,265

22 41.73 29,976 4,173 7,494 374,705 5,620,582

23 42.17 30,287 4,217 7,572 378,593 5,678,900

24 42.60 30,598 4,260 7,650 382,481 5,737,218

25 43.03 30,910 4,303 7,727 386,369 5,795,535

26 43.46 31,221 4,346 7,805 390,257 5,853,853

27 43.90 31,532 4,390 7,883 394,145 5,912,171

28 44.33 31,843 4,433 7,961 398,033 5,970,488

29 44.76 32,154 4,476 8,038 401,920 6,028,806

30 45.20 32,465 4,520 8,116 405,808 6,087,124

31 45.63 32,776 4,563 8,194 409,696 6,145,441

32 46.06 33,087 4,606 8,272 413,584 6,203,759

33 46.50 33,398 4,650 8,349 417,472 6,262,077

34 46.93 33,709 4,693 8,427 421,360 6,320,394

35 47.36 34,020 4,736 8,505 425,247 6,378,712

36 47.79 34,331 4,779 8,583 429,135 6,437,030

37 48.23 34,642 4,823 8,660 433,023 6,495,347

38 48.66 34,953 4,866 8,738 436,911 6,553,665

39 49.09 35,264 4,909 8,816 440,799 6,611,982

40 49.53 35,575 4,953 8,894 444,687 6,670,300 41 49.96 35,886 4,996 8,971 448,575 6,728,618 Source: Study team

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c) Benefit calculation Table 5-5 below shows the recent sales volume and income of the Republican Blood Transfusion Center, disclosed by MOH. Based on the data, domestic unit price for albumin and globulin is 50.43 USD/L (5,920 JPY/L) and 2.56 USD/L (300 JPY/L).

Table 5-5 Unit Price and Production Volume of Plasma Derivatives of the Existing Factory

Plasma derivative sales volume of the Republican Blood Transfusion Center (in L) 2015 Item Unit 2016 half-year Q4 1 Albumin L 42.7 65.8 2 Anti-rhesus macaque immune globulin L 162 224 3 Blood coagulation factor VIII L 32 85 4 Anti-staphylococci immune globulin L 199 48 The Republican Blood Transfusion Center’s income from plasma derivatives (in 1,000 UZS) 2015 Item Unit 2016 half-year Q4 1 Albumin 1,000 UZS 6828.2 10522.2 2 Anti-rhesus macaque immune globulin 1,000 UZS 1567.3 2167.2 3 Blood coagulation factor VIII 1,000 UZS 640.3 1700.7 4 Anti-staphylococci immune globulin 1,000 UZS 1323.3 319.2

Source: MOH

In regards to imported blood products the information indicated in Table 5-6 was disclosed by MOH through interviews. As MOH looks to domestically distribute and export new blood products at similar prices in the future, the prices for new blood products were used as the basis for to calculate benefits for the B/C analyses.

Table 5-6 New Product Price Table

10% albumin 10% globulin Factor VIII (liter) (dose) 1 dose = 3ml (unit) MOH purchase price 626.15 USD 13.95 USD 0.37 USD Price of equivalent Japanese 46,230 JPY 1,551 JPY 64 JPY product for reference

Source: MOH

Operations, maintenance and management of the facilities and equipment will cost approximately 200 million JPY as indicated in Table 5-7. The expected utility costs of the factory facilities are 22 to 100 million JPY as indicated in Table 5-8.

Table 5-7 Estimated Maintenance and Management Costs of the Plasma Product Factory

Item Annual cost (in JPY) Remark Facility and equipment 0.1% of facility price, and maintenance and 132,756,000 0.5% of equipment price assumed management cost per year Facility utility costs etc. Variable depending on production 22,237,000 - 102,857,000 volume (See Table 5-9) Total Approx. 155 - 235 million JPY

Source: Study team

5-5

Table 5-8 Facility Utility Costs, etc.

4,000L per year 25,000L per year Unit price Annual cost Annual cost Item Usage Unit Usage Unit (JPY) (JPY) (JPY) 1 Electricity 6.46 224,000 KWh 1,447,040 1,400,000 KWh 9,044,000 2 Gas 8.31 17,600 Nm3 146,256 110,000 Nm3 914,100 3 Water 6.08 1,280 m3 7,782 8,000 m3 48,640 Well water (city 4 6.08 416 2,529 2,600 15,808 water) 5 96% ethanol 2,327 3,570 L 8,307,390 19,525 L 45,434,675 6 53% ethanol 1,600 7,704 L 12,326,400 29,625 L 47,400,000 In-house production of 7 624 L - 3,900 L - purified water (UF water) 8 Infectious waste 1,600 kg - 10,000 kg - 9 Industrial waste 4,800 kg - 30,000 kg - Total cost per year 22,237,398 102,857,223

Source: Study team

Based on the preconditions described above, an analysis was conducted by three possible cases (Case 1, Case 2 and Case 3).

Case 1: Benefits were calculated based on the expected production volume (Table 5-4) and the plasma derivative unit price of the existing factory (Table 5-5). Calculation results are shown in the “Expected income/domestic price (USD)” columns in Table 5-9 B/C Calculation Table.

5-6

Table 5-9 B/C Calculation Table

Plasma fractionation formulation Expected income/domestic price（USD) Expected income/new product price (USD) production volume forecast 10% 10% Passe Immunoglob Alubmin Factor Ⅷ d ulin albumin immunoglobulin factor No.8 Total albumin immunoglobulin factor No.8 Total product (unit) years (dose： volume(L) 3ml）

25 cc/litr 12.5 dose/litr 187.5 dose/litr $50.43 /litr $0.00768 /dose(3ml) $0.33 /unit $626.00 /litr $13.95 /dose(3ml) $0.37 /unit

1 750 37,500 $37,823 $288 $0 $38,111 $469,500 $523,125 $0 $992,625 2 1,000 50,000 $50,430 $384 $0 $50,814 $626,000 $697,500 $0 $1,323,500 3 1,500 75,000 $75,645 $576 $0 $76,221 $939,000 $1,046,250 $0 $1,985,250 4 2,250 112,500 1,000,000 $113,468 $864 $330,000 $444,332 $1,408,500 $1,569,375 $370,000 $3,347,875 5 3,250 162,500 2,437,500 $163,898 $1,248 $804,375 $969,521 $2,034,500 $2,266,875 $901,875 $5,203,250 6 4,750 237,500 3,562,500 $239,543 $1,824 $1,175,625 $1,416,992 $2,973,500 $3,313,125 $1,318,125 $7,604,750 7 5,500 275,000 4,125,000 $277,365 $2,112 $1,361,250 $1,640,727 $3,443,000 $3,836,250 $1,526,250 $8,805,500 8 6,000 300,000 4,500,000 $302,580 $2,304 $1,485,000 $1,789,884 $3,756,000 $4,185,000 $1,665,000 $9,606,000 9 6,250 312,500 4,687,500 $315,188 $2,400 $1,546,875 $1,864,463 $3,912,500 $4,359,375 $1,734,375 $10,006,250 10 6,483 324,164 4,862,453 $326,951 $2,490 $1,604,609 $1,934,050 $4,058,527 $4,522,081 $1,799,108 $10,379,716 11 6,561 328,051 4,920,771 $330,873 $2,519 $1,623,854 $1,957,246 $4,107,203 $4,576,317 $1,820,685 $10,504,205 12 6,639 331,939 4,979,088 $334,794 $2,549 $1,643,099 $1,980,442 $4,155,879 $4,630,552 $1,842,263 $10,628,694 13 6,717 335,827 5,037,406 $338,715 $2,579 $1,662,344 $2,003,638 $4,204,555 $4,684,787 $1,863,840 $10,753,182 14 6,794 339,715 5,095,724 $342,636 $2,609 $1,681,589 $2,026,834 $4,253,231 $4,739,023 $1,885,418 $10,877,671 15 6,872 343,603 5,154,041 $346,558 $2,639 $1,700,834 $2,050,030 $4,301,906 $4,793,258 $1,906,995 $11,002,160 16 6,950 347,491 5,212,359 $350,479 $2,669 $1,720,078 $2,073,226 $4,350,582 $4,847,494 $1,928,573 $11,126,649 17 7,028 351,378 5,270,677 $354,400 $2,699 $1,739,323 $2,096,422 $4,399,258 $4,901,729 $1,950,150 $11,251,137 18 7,183 359,154 5,387,312 $362,243 $2,758 $1,777,813 $2,142,814 $4,496,610 $5,010,200 $1,993,305 $11,500,115 19 7,261 363,042 5,445,629 $366,164 $2,788 $1,797,058 $2,166,010 $4,545,285 $5,064,435 $2,014,883 $11,624,604 20 7,339 366,930 5,503,947 $370,085 $2,818 $1,816,303 $2,189,206 $4,593,961 $5,118,671 $2,036,460 $11,749,092 21 7,416 370,818 5,562,265 $374,007 $2,848 $1,835,547 $2,212,402 $4,642,637 $5,172,906 $2,058,038 $11,873,581 22 7,494 374,705 5,620,582 $377,928 $2,878 $1,854,792 $2,235,598 $4,691,313 $5,227,142 $2,079,615 $11,998,070 23 7,572 378,593 5,678,900 $381,849 $2,908 $1,874,037 $2,258,794 $4,739,989 $5,281,377 $2,101,193 $12,122,559 24 7,650 382,481 5,737,218 $385,771 $2,937 $1,893,282 $2,281,990 $4,788,664 $5,335,612 $2,122,771 $12,247,047 25 7,727 386,369 5,795,535 $389,692 $2,967 $1,912,527 $2,305,186 $4,837,340 $5,389,848 $2,144,348 $12,371,536 26 7,805 390,257 5,853,853 $393,613 $2,997 $1,931,771 $2,328,382 $4,886,016 $5,444,083 $2,165,926 $12,496,025 27 7,883 394,145 5,912,171 $397,534 $3,027 $1,951,016 $2,351,578 $4,934,692 $5,498,319 $2,187,503 $12,620,514 28 7,961 398,033 5,970,488 $401,456 $3,057 $1,970,261 $2,374,774 $4,983,368 $5,552,554 $2,209,081 $12,745,002 29 8,038 401,920 6,028,806 $405,377 $3,087 $1,989,506 $2,397,970 $5,032,043 $5,606,790 $2,230,658 $12,869,491 30 8,116 405,808 6,087,124 $409,298 $3,117 $2,008,751 $2,421,166 $5,080,719 $5,661,025 $2,252,236 $12,993,980 31 8,194 409,696 6,145,441 $413,219 $3,146 $2,027,996 $2,444,362 $5,129,395 $5,715,260 $2,273,813 $13,118,469 32 8,272 413,584 6,203,759 $417,141 $3,176 $2,047,240 $2,467,558 $5,178,071 $5,769,496 $2,295,391 $13,242,957 33 8,349 417,472 6,262,077 $421,062 $3,206 $2,066,485 $2,490,753 $5,226,747 $5,823,731 $2,316,968 $13,367,446 34 8,427 421,360 6,320,394 $424,983 $3,236 $2,085,730 $2,513,949 $5,275,422 $5,877,967 $2,338,546 $13,491,935 35 8,505 425,247 6,378,712 $428,905 $3,266 $2,104,975 $2,537,145 $5,324,098 $5,932,202 $2,360,123 $13,616,424 36 8,583 429,135 6,437,030 $432,826 $3,296 $2,124,220 $2,560,341 $5,372,774 $5,986,437 $2,381,701 $13,740,912 37 8,660 433,023 6,495,347 $436,747 $3,326 $2,143,465 $2,583,537 $5,421,450 $6,040,673 $2,403,278 $13,865,401 38 8,738 436,911 6,553,665 $440,668 $3,355 $2,162,709 $2,606,733 $5,470,126 $6,094,908 $2,424,856 $13,989,890 39 8,816 440,799 6,611,982 $444,590 $3,385 $2,181,954 $2,629,929 $5,518,801 $6,149,144 $2,446,434 $14,114,379 40 8,894 444,687 6,670,300 $448,511 $3,415 $2,201,199 $2,653,125 $5,567,477 $6,203,379 $2,468,011 $14,238,867 41 8,971 448,575 6,728,618 $452,432 $3,445 $2,220,444 $2,676,321 $5,616,153 $6,257,615 $2,489,589 $14,363,356 Source: Study team

Case 2: As with the Case 1, benefits were calculated based on the expected production volume (Table 5-4) but with new product prices disclosed by MOH (Table 5-6). Calculation results are shown in the “（US$）” columns in Table 5-9 B/C Calculation Table.

Case 3: Benefit was calculated on the assumption of an 85% achievement rate of the intended production volume (Table 5-4) based on the conditions of Case 2.

The results of expense and benefit calculations for the cases above are shown in the cash flow tables in Table 5-11, 5-12 and 5-13. d) Analysis results For Case 1, benefits were calculated based on local prices of plasma derivatives as of the study. Due to the low

5-7 product unit prices, NPV and B/C were calculated to be −45,319,000 USD and 0.659, respectively. Thus, the case is not profitable.

For Case 2, benefits were calculated based on the latest price of plasma derivatives disclosed by the Ministry of Health, which is higher than that of Case 1. The project would be sufficiently profitable based on the latest MOH price for blood products, with NPV and B/C rated as 64,941,000USD and 1.50, respectively.

For Case 3, benefits were calculated with 85% of the target production volume on the assumption that the production of plasma derivatives could not reach the target volume. As a result, NPV and B/C were calculated to be 45,368,000 USD and 1.35, respectively, which are both lower than those of Case 2. However, the case is still profitable and expected to produce sufficient income. FIRR could not be calculated as NPV, is constantly positive in all the cases, and NPV becomes 0 in no instance.

Table 5-10 Financial Analysis Results Unit: 1000 USD Case1 Case2 Case3 Operational cost All paid All paid All paid distribution Grant for staff Yes Yes Yes compensation, etc., from 130,000 USD per month 130,000 USD per month 130,000 USD per month MOH Pricing of plasma Local price at the time of Latest MOH price Latest MOH price derivatives the first local study Target production volume As per Table 5-4 As per Table 5-4 85% of Table 5-4 NPV -45,319 64,941 45,368 B/C 0.659 1.500 1.350 FIRR − − − Source: Study team

5-8

Table 5-11 Cash Flow Table for Case 1

Source: Study team

Table 5-12 Cash Flow Table for Case 2

Source: Study team

5-9

Table 5-13 Cash Flow Table for Case 3

Source: Study team

5-10

2) Economic Analysis a) Consideration of economic costs and benefits 1. Concept of Benefits There are the following four potential economic benefits of the proposed project.

Table 5-14 Potential Economic Benefits of the Proposed Project No. Type of benefit Measurement 1 Production of sufficient amount of plasma ・ Increase of produced plasma derivatives will eliminate the importing cost derivatives arising out of the heavy dependence on ・ Decrease or elimination of imports imports. The domestic sales volume will also increase. 2 Surplus plasma derivatives produced ・ Exports of plasma derivatives domestically can be exported to neighboring countries. 3 Deployment of bloodmobiles is expected to ・ Increase of donated blood lead to a significant increase in the amount of ・ Increase of plasma derivative donated blood. production due to obtaining more plasma (a raw material of plasma derivatives) 4 Patients’ risk of infection will be substantially ・ Reduction of risk of infection reduced by the introduction of established blood test systems. Source: Study team

Increase of plasma derivatives and plasma described in No.1 and No.3 above is the effect of pricing relative to the derivative production volume as discussed in relation to the financial analysis.

The benefits of No.4 can only be accessed qualitatively based on a reduction of infection risk as data regarding infection cases after dosing of plasma derivatives are not available.

The benefits of No.2 are the potential benefits from the possibility of exporting plasma derivatives when domestic demands are fully met. This benefits are examined below.

2. Preconditions Conditions for estimating the economic benefits are the same as those in the financial analysis. With the plasma derivative production volume expected to exceed the current imported albumin volume of 1,100L in 3 years after the completion of the new factory (Table 5-4), the annual imports amounting to approximately 100 million JPY will be eliminated and even income from exporting can be expected. The required volume of plasma derivatives for the Uzbek population is indicated in the table below based on the WHO’s recommendation per 1 million.

Table 5-15 WHO’s Recommended Volume of Plasma Derivatives (per 1 million)

WHO’s recommended volume (per 1 million population) Product 10% albumin 10% immune globulin Factor VIII specifications (liter) (dose) 1 dose = 3ml (unit) Required 100L/1 million 6,000 dose/1 million 100,000 unit/1 million volume

Source: WHO

Expected surplus and export amount calculated based on the above preconditions are shown in Table 5-16. The export prices were set to 90% of domestic sales price in order to achieve price competitiveness in the global market relative to the present import prices.

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Table 5-16 Expected Surplus and Export Amount Plasma fractionation formulation production volume Surplus (Export) volume prediction Surplus (Export) value prediction forecast

Albumin amount predicted recommended 10% Alubmin 10% 10% Alubmin 10% 10% 10% Passed population Plazma amount Factor Ⅷ Factor Ⅷ Factor Ⅷ Total value for the product Immunoglobulin Export Immunoglobulin Alubmin Immunoglobulin years （million (L) (unit) (unit) (USD) （USD) population volume(L) (dose：3ml） volume(L) (dose：3ml） (USD) (USD) person）（L)

1 32.21 3,000 3,221 750 37,500

2 32.64 4,000 3,264 1,000 50,000

3 33.07 6,000 3,307 1,500 75,000

4 33.51 9,000 3,351 2,250 112,500 1,000,000

5 33.94 13,000 3,394 3,250 162,500 2,437,500

6 34.37 19,000 3,437 4,750 237,500 3,562,500 1,313 31,274 125,400 $739,865 $392,632 $41,719 $1,174,216

7 34.80 22,000 3,480 5,500 275,000 4,125,000 2,020 66,176 644,600 $1,138,115 $830,811 $214,452 $2,183,379

8 35.24 24,000 3,524 6,000 300,000 4,500,000 2,476 88,578 976,300 $1,395,482 $1,112,059 $324,806 $2,832,346

9 35.67 25,000 3,567 6,250 312,500 4,687,500 2,683 98,480 1,120,500 $1,511,964 $1,236,374 $372,780 $3,121,118

10 36.10 25,933 3,610 6,483 324,164 4,862,453 2,873 107,546 1,252,153 $1,619,019 $1,350,188 $416,579 $3,385,787

11 36.54 26,244 3,654 6,561 328,051 4,920,771 2,907 108,835 1,267,171 $1,638,437 $1,366,381 $421,576 $3,426,394

12 36.97 26,555 3,697 6,639 331,939 4,979,088 2,942 110,125 1,282,188 $1,657,855 $1,382,575 $426,572 $3,467,001

13 37.40 26,866 3,740 6,717 335,827 5,037,406 2,976 111,415 1,297,206 $1,677,272 $1,398,768 $431,568 $3,507,609

14 37.84 27,177 3,784 6,794 339,715 5,095,724 3,011 112,705 1,312,224 $1,696,690 $1,414,961 $436,564 $3,548,216

15 38.27 27,488 3,827 6,872 343,603 5,154,041 3,045 113,995 1,327,241 $1,716,108 $1,431,155 $441,561 $3,588,823

16 38.70 27,799 3,870 6,950 347,491 5,212,359 3,080 115,285 1,342,259 $1,735,525 $1,447,348 $446,557 $3,629,430

17 39.13 28,110 3,913 7,028 351,378 5,270,677 3,114 116,574 1,357,277 $1,754,943 $1,463,542 $451,553 $3,670,038

18 40.00 28,732 4,000 7,183 359,154 5,387,312 3,183 119,154 1,387,312 $1,793,778 $1,495,929 $461,546 $3,751,252

19 40.43 29,043 4,043 7,261 363,042 5,445,629 3,218 120,444 1,402,329 $1,813,196 $1,512,122 $466,542 $3,791,860

20 40.87 29,354 4,087 7,339 366,930 5,503,947 3,252 121,734 1,417,347 $1,832,614 $1,528,315 $471,538 $3,832,467

21 41.30 29,665 4,130 7,416 370,818 5,562,265 3,286 123,024 1,432,365 $1,852,031 $1,544,509 $476,534 $3,873,074

22 41.73 29,976 4,173 7,494 374,705 5,620,582 3,321 124,313 1,447,382 $1,871,449 $1,560,702 $481,530 $3,913,682

23 42.17 30,287 4,217 7,572 378,593 5,678,900 3,355 125,603 1,462,400 $1,890,867 $1,576,896 $486,527 $3,954,289

24 42.60 30,598 4,260 7,650 382,481 5,737,218 3,390 126,893 1,477,418 $1,910,284 $1,593,089 $491,523 $3,994,896

25 43.03 30,910 4,303 7,727 386,369 5,795,535 3,424 128,183 1,492,435 $1,929,702 $1,609,282 $496,519 $4,035,504

26 43.46 31,221 4,346 7,805 390,257 5,853,853 3,459 129,473 1,507,453 $1,949,120 $1,625,476 $501,515 $4,076,111

27 43.90 31,532 4,390 7,883 394,145 5,912,171 3,493 130,763 1,522,471 $1,968,537 $1,641,669 $506,512 $4,116,718

28 44.33 31,843 4,433 7,961 398,033 5,970,488 3,528 132,053 1,537,488 $1,987,955 $1,657,863 $511,508 $4,157,325

29 44.76 32,154 4,476 8,038 401,920 6,028,806 3,562 133,342 1,552,506 $2,007,372 $1,674,056 $516,504 $4,197,933

30 45.20 32,465 4,520 8,116 405,808 6,087,124 3,597 134,632 1,567,524 $2,026,790 $1,690,250 $521,500 $4,238,540

31 45.63 32,776 4,563 8,194 409,696 6,145,441 3,631 135,922 1,582,541 $2,046,208 $1,706,443 $526,497 $4,279,147

32 46.06 33,087 4,606 8,272 413,584 6,203,759 3,665 137,212 1,597,559 $2,065,625 $1,722,636 $531,493 $4,319,755

33 46.50 33,398 4,650 8,349 417,472 6,262,077 3,700 138,502 1,612,577 $2,085,043 $1,738,830 $536,489 $4,360,362

34 46.93 33,709 4,693 8,427 421,360 6,320,394 3,734 139,792 1,627,594 $2,104,461 $1,755,023 $541,485 $4,400,969

35 47.36 34,020 4,736 8,505 425,247 6,378,712 3,769 141,081 1,642,612 $2,123,878 $1,771,217 $546,481 $4,441,577

36 47.79 34,331 4,779 8,583 429,135 6,437,030 3,803 142,371 1,657,630 $2,143,296 $1,787,410 $551,478 $4,482,184

37 48.23 34,642 4,823 8,660 433,023 6,495,347 3,838 143,661 1,672,647 $2,162,714 $1,803,604 $556,474 $4,522,791

38 48.66 34,953 4,866 8,738 436,911 6,553,665 3,872 144,951 1,687,665 $2,182,131 $1,819,797 $561,470 $4,563,399

39 49.09 35,264 4,909 8,816 440,799 6,611,982 3,907 146,241 1,702,682 $2,201,549 $1,835,990 $566,466 $4,604,006

40 49.53 35,575 4,953 8,894 444,687 6,670,300 3,941 147,531 1,717,700 $2,220,967 $1,852,184 $571,463 $4,644,613 41 49.96 35,886 4,996 8,971 448,575 6,728,618 3,976 148,821 1,732,718 $2,240,384 $1,868,377 $576,459 $4,685,220 Source: Study team

In Case 4, income in Case 2 was replaced by the import profit calculated above. The cash flow table for Case 4 is shown in Table 5-19. As shown in Table 5-17, results of this calculation were -29,409,000 USD for NPV and 0.773 for B/C; NPV is negative, but the B/C value indicates that the export income would account for about 51% of the total income in Case 2. Thus, the benefit from plasma derivative exporting is expected to deliver significant positive effects in Uzbekistan. Table 5-17 Results of Economic Analysis Unit: 1,000 USD Case 4 Operational cost distribution All paid Grant for staff compensation, etc., from MOH Yes Pricing of plasma derivatives Latest MOH price Expected benefit Blood product export NPV -29,409 B/C 0.773 FIRR - Source: Study team

5-12

Table 5-18 Cash Flow Table for Case 4

Source: Study team

5-13

Chapter 6 Planned Project Schedule

(1) Overall Schedule

1) Split of Project Scope The entire project is proposed to be STEP yen-loan based. The yen-loan project scope is split into the following 4 categories.

Table 6-1 Split of Project Scope

Project scope Project description Contractors Consulting - Detailed design - Japanese consultant - Bidding - Procurement supervision Facility development - Facility design, construction and - Japanese constructor delivery - Local general constructor - Guidance for facility operation maintenance and management - Defect warranty Equipment - Equipment production, installation and - Japanese trading company etc. procurement delivery - Guidance on equipment operations - Defect warranty - Consumable supply (4 years) Technical instructions - Technical instructions and human - Japanese consultant and blood resource training etc. service implementing organization

Source: Study team

2) Implementation Schedule The expected implementation schedule based on the scope described above is shown in the table below. After completion of this study, the Uzbekistan government will proceed with its internal decision making processes and submit a request letter to the Japanese Government. A preparatory survey will then be conducted by JICA before confirmation of the project. Following the execution of E/N and L/A based on the survey results, a consultant to support the implementation will be appointed and a detailed design will subsequently be completed in about 7 months.

Contractors for facility development and equipment procurement will then be selected and equipment installation and operation instructions will be provided upon completion of the construction after 18 months.

Technical guidance, human resource training and consumable supplies will also be provided for 4 years until the project is completed.

6-1

Figure 6-1Implementation Schedule Year1 Year2 Year3 Year4 Year5 Year5 Study completed

Internal request for decision in Uzbek Government

JICA preparatory survey

E/N and L/A execution

Consultant selection

Consultancy contract execution

Equipment delivery (plasma product factory)

Equipment installation, plant installation arrangement and delivery (production facilities) Equipment procurement bidding (Tashkent City and regional blood centers)

Defect liability period

Source: Study team

6-2

Chapter 7 Implementing Organization

(1) Overview of Implementing Organization in the Host Country

1) Overview of Implementing Organization MOH serves to plan, manage and adjust health-care systems in Uzbekistan, and also manage national health-care institutions. In each province, there is also a health department that manages health-care institutions in the province. In the Republic of Karakalpakstan, its independent MOH led by a minister governs health-care administration in the autonomous republic.

In relation to blood services, the Republican Blood Transfusion Center is under the supervision of MOH, but the blood transfusion station(s) in each province are managed by the provincial health department. However, operations related to blood donation and production in each provincial blood center is governed and supervised by the Republican Blood Transfusion Center.

2) Chart of Implementing Organization a) Position of implementing organization in the national government As shown in the chart below, MOH is under the supervision of deputy prime minister in charge of education, health care, welfare and information, who reports to the prime minister and the president. The Republican Blood Transfusion Center, the implementing organization of this project, is under the control of MOH and currently led by the Director Rustam Yoldashev.

Figure 7-1 Position of Implementing Organization in the Uzbek Government

Source: MOH b) MOH Organization Chart The following figure shows the organization chart of MOH. MOH has 1 minister and 4 deputy ministers. Among them, the Deputy Minister Hudaikulov is in charge of the blood services. There is also a department in charge of ODA, which is led by Mr. Jabriev. The person responsible for practical operations of the proposed project will be

7-1

Director Yoldashev of the Republican Blood Center, who is responsible for the entire blood services of the country.

The medical institutions and the Design Institute will also be involved in the development of medical facilities and grant design approval etc.

Multiple republican medical centers with blood transfusion stations will also take part in the blood services.

Figure 7-2 MOH Organization Chart

Source: MOH

(2) Host Country’s Organization for Project Implementation

1) Supervising Organization (MOH) As the project scope is, in principle, limited to the rebuilding of an existing facility and/or addition of functions, there are no plans to change the above implementation organization. Therefore, the Uzbek MOH will serve as a supervising organization during the project period while the Republican Blood Transfusion Center will be the implementing organization of the project.

Within the supervising organization, MOH, as described above, the Blood Preparation Department will take charge of the project and Mr. Alim Imatov will be the responsible official. As the proposed project is a yen-loan project, the Investment Projects Coordination Department in charge of ODA investment will also be involved.

2) Implementing Organization (Republican Blood Transfusion Center) On the implementing organization side, Director Yoldashev of the Republican Blood Transfusion Center will assume responsibility for implementing the project. Operations after the development of the new factory development and the introduction of equipment can be handled by the current staff of the Republican Blood Transfusion Center and regional blood centers.

7-2

a) Plasma derivative factory The following 23 specialists are expected, in total, to be required for operations of the new plasma derivative factory.

 Alcohol fractionation and bulk adjustment: 8  Filling and packing: 4  Facility management and procurement management: 6  Quality control: 5  QA: 2-3 (may be fulfilled by the quality control staff)

On the assumption that the 22 specialists currently working for the existing plasma derivative factory will continue to work for the new factory, recruiting one additional staff member will meet the staff requirements. However, thorough technical instruction and training are required in preparation for the introduction of GMP-compliance practices and new equipment. b) Blood centers (the Republican Blood Transfusion Center and 3 regional blood transfusion stations) No significant facility extension is planned for blood centers and there will be no immediate need for a reinforcing workforce following the project commencement. As discussed in relation to future outlook, however, installation of new donation rooms and recruitment of new staff to cope with increased blood donations are expected to be needed in the course of the efforts to increase the number of donors. In addition, it is desirable to standardize and schematize new staff training as an attempt to achieve efficient human resource development.

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Chapter 8 Technical Advantages of Japanese Companies

(1) The International Competitiveness of Japanese Companies and the Possibility of Winning Contracts in the Proposed Project

1) Entire Blood Services The plasma derivative production techniques to be introduced to Uzbekistan through the proposed project are elementary techniques, for which there are no significant differences in technical competencies among advanced nations including Japan. Similarly, equipment used in the production processes and construction techniques for clean rooms are very common among many countries and companies in Europe and other parts of the world. In other words, Japan and Japanese companies have no particular advantage in this field.

On the other hand, Japan’s blood services are known to have the world’s highest level of safety and quality. Also, in Japan there is great public trust in the blood services developed through blood donation campaigns promoted by local administrations and blood donation promoting organizations etc., which has led to a high rate of blood donation. Thus, Japan’s strengths lie in its thorough quality control excellent enough to maintain this trust and its consistent provision of highly efficient and safe blood products to the public.

In other words, Japan’s strengths in blood services are comprised of collective competencies of its entire blood service system covering upstream processes including blood collection, backed by the excellent quality control know-how and professional ethics of experts.

It is not easy to point out the objective and quantitative measurements of the competitiveness of Japan’s intangible techniques and know-how. However, including the transfer of such techniques and know-how in the scope of this project will likely increase the chance for Japanese companies to receive orders. Additionally, for the smooth transfer of techniques and know-how from Japanese technicians, the introduction of reliable equipment familiar to them would be prioritized and this could also increase the chance of introducing the products of Japanese manufacturers.

2) Provision of Facilities and Equipment by Japanese Companies The facilities and production equipment of the Japan Red Cross (the primary blood service operator of Japan) and domestic plasma product factories are mostly supplied by Japanese manufacturers. In fact, they prefer to use Japanese equipment probably because of reliable after-sales services and convenience in repair services and spare parts replacement etc.

In the global market, on the other hand, production facilities and equipment of foreign manufacturers occupy a high share and the presence of Japanese manufacturers is limited. Japanese products are generally regarded as excellent in quality but expensive, and these views of Japanese products makes Japan prone to be excluded from cost-conscious procurement projects.

Thus, the products of Japanese manufacturers have a competitive advantage in the domestic market in terms of maintainability, but they are not particularly competitive in pricing for Uzbekistan. For Japanese equipment to achieve a competitive advantage in this project, measures to add more values, such as the establishment of a maintenance scheme (e.g., after-sales services) are required.

3) Expectations of the Host Country Government

As mentioned in an early part of Chapter 3, this project originates in the presidential order of the ex-President Karimov (No. 4639, issued on April 19, 2016), in which a Japan-Uzbekistan project was envisioned as part of the economic cooperation between the countries. Uzbek deep trust in Japanese products and technical competencies built through past economic activities between Japan and Uzbekistan must be the primary reason of designating Japan in the order statement. Taking into account the background of project formation, Uzbekistan primarily seeks Japan’s participation in the project and it is likely that Japan can take the initiative in this project when other conditions are met.

(2) Japanese Materials and Equipment, and their Prices

1) New Plasma Product Factory Equipment items of Japanese manufacturers are not particularly competitive in the global market. However, Uzbek government has shown deep trust in Japanese products and an arrangement to promote the adoption of as

8-1 many Japanese products as possible in the project needs to be considered.

The following table lists equipment items of Japanese candidates for equipment proposed for introduction to the new plasma product factory. As Japanese manufactures can supply most of the items to be procured, there would certainly be a chance for Japanese manufacturers to win contracts if they can show competitive advantages in price and quality over foreign products.

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Table 8-1 Main Equipment Items for Plasma Product Factory

Unit price Equipment Room Maker (in million Remark (specs, etc.,) JPY)

CIP room

Boiler room, cleaning room,

bottle-washing room, etc. Reagent preparation rooms, fractionation room, inactivation treatment room, final preparation room, purification room, etc.

Brine room

Reagent water room

Freeze-dry room

Pre-freeze-dry

room

Plasma

dissolution room

Filtration room Final albumin

preparation room Bulk pasteurization

room (provisional)

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Centrifugal

separator room

Fractionation

room

Alcohol storage

Autoclave

(secondary zone)

Final filtration

room

Purification room

Autoclave

(tertiary zone)

Bottle-washing room, dispensing room

system>

Factory

equipment

Instrumentation

Source: Study team

2) Blood Centers NAT equipment used in Japan are foreign products. However, there is a chance that Japan’s bloodmobiles and other equipment for testing, analysis and blood collection will be introduced to the blood centers if competitive pricing, quality and maintainability are established.

(3) Measures Required to Help Japanese Companies Win Contracts

1) Provision of Maintenance and Technological Support in Yen-Loan Package As mentioned above, while Japanese companies are capable of supplying the proposed facilities and equipment for this project, they do not have a particular competitive advantage and various side conditions should be satisfied as a prerequisite for them to win contracts.

The scope of the proposed project package is planned to include facility development, post-procurement equipment maintenance, reagent/consumable supplies, guidance on maintenance and management, and technology transfer etc., which are not common among yen-loan projects. The period was set to 4 years, during which Uzbek stakeholders are expected to become capable of operating the blood services independently toward their goals. This package configuration would create a cost benefit in relatively expensive Japanese equipment in terms of total costs including running expenses. Because of its longstanding history of blood services, Japan has a number of experienced experts, and technological guidance provided by such experts would add substantial value to the proposed project.

It is important to continue consultation and evaluation on both the Uzbekistan and Japan sides in order to establish a package containing a software support plan.

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2) Evaluation of STEP Conditions The project proposal has been developed with a view to use the STEP yen loan. Despite lack of a particular competitive advantage of Japanese equipment, Japan can source most of the items required for the project and, thus, there is a possibility that STEP conditions can be satisfied. This is particularly that case since the quality control and safety measures to be implemented for the entire blood services are the fields where the excellent technology of Japan can be applied. If these items can become part of the yen-loan project scope, they can be a basis for STEP application.

While further consultation and adjustment with stakeholders including JICA are necessary, Uzbekistan has expressed high expectations toward implementing a Japan-tied project, and evaluation of the potential of this project should be continued further.

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