supply chain

Using antiretrovirals (ARVs) as tracer products, we identified the following key practices that may affect supply chain management at the facility level: order verification, actions taken when stock is received, changes in prescription and dispensing due to ARV stock-out, actions to ensure patient adherence, and communication with other affiliated facilities and higher-level supply chain management. We propose a set of indicators to measure these practices.

From 2006 to 2014, Supply Chain Management System (SCMS), the global procurement and distribution project for the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR), distributed over US$1.6 billion worth of antiretroviral drugs and other health commodities, with over US$263 million purchased from local vendors in 14 countries in sub-Saharan Africa. A simple framework was developed and 39 local suppliers from 4 countries were interviewed between 2013 and 2014 to understand how SCMS local sourcing impacted supplier development. SCMS local suppliers reported new contracts with other businesses (77%), new assets acquired (67%), increased access to capital from local lending institutions (75%), offering more products and services (92%), and ability to negotiate better prices from their principals (80%). Additionally, 70% (n=27) of the businesses hired between 1 and 30 new employees after receiving their first SCMS contract and 15% (n=6) hired between 30 and 100 new employees. This study offers preliminary guidance on how bilateral and multilateral agencies could design effective local sourcing programs to create sustainable local markets for selected pharmaceutical products, laboratory, and transport services.

Moving the global response towards the universal test and treat model will pose huge challenges to public health systems in resource-limited settings, including global and local supply chain systems. These challenges are especially acute in Africa, which accounts for over 70% of the persons affected by HIV.To ensure that there are enough anti-retrovirals available to treat the nearly 25 million people that will require them by 2020 represents a near doubling of the ARV supplied to treat the 13 million currently on treatment. Similarly, to monitor those on treatment means an unprecedented scale-up of viral load testing throughout Africa. Larger issues include whether the capacity exists at the local level to handle these commodities when they arrive in the most severely affected countries, including considerations of the human resources and costs needed to make this strategy effective. We believe that such ‘‘real world’’ analysis of proposed strategies and policies is essential to ensure their most effective implementation.

In 2010, the Ministry of Health (MoH) asked USAID for technical assistance to implement interventions to improve the HIV/AIDS supply chain system. Assessments revealed that fragmentation of the pharmaceutical system contributed to stock-outs and expiration of antiretroviral (ARVs) and other medicines and supplies used by disease control programs. The implementation of an integrated system was proposed as the most efficient and sustainable alternative to confront the HIV/AIDS pharmaceutical supply problems.

The Government of Cameroon and its partners have made major investments in the last decade in prevention, treatment, and care of HIV-infected patients. However, unmet need for antiretroviral therapy (ART) among HIV-positive pregnant women remains high at 66%. Critical to satisfying this need is ensuring adequate availability of prevention of mother-to-child transmission (PMTCT) commodities for rollout of new Option B+ guidelines. This study examines options for improving the supply and availability of these commodities. Supply chain operational data was collected in July 2014 from central (CENAME) and 4 regional warehouses (CAPRs); 10 district stores; and 30 service delivery points (SDPs), including ART and PMTCT sites. The study also included seven central private-sector logistics firms. In addition, SC cost data was obtained from CENAME and CAPRs financial statements. Data collected served for analysis of three options to improve effectiveness of delivering PMTCT commodities. Asset utilization within the cost recovery system ranged between 73% and 89% while inventory turnover was at 1.5. Therefore, a reliable supply of medicines to SDPs is ensured. However, for PMTCT and ART commodities, distribution to the SDPs was unreliable (in 2013, 40% of prescriptions remained unfilled). Meanwhile, results of the options analysis indicated that the model of CAPRs delivering PMTCT commodities to SDPs was the most desirable. Although the distance traveled was higher, the need for network storage space was minimal. Moreover, its total cost and human resource requirements were more favorable. As a result of disseminating the findings, the Ministry of Health adopted Option 2.

The costs of delivering specific products are poorly understood and ballpark estimates are often used to inadequately plan for the budgetary implications of supply chain expenses. The purpose of this research was to estimate the country level costs of the public sector supply chain for artemisinin-based combination therapy (ACT) and rapid diagnostic tests (RDTs) from the central to the peripheral levels in Benin and Kenya. A micro-costing approach was used and primary data on the various cost components of the supply chain was collected at the central, intermediate, and facility levels between September and November 2013. Information sources included central warehouse databases, health facility records, transport schedules, and expenditure reports. In Benin, supply chain costs added US$0.20 to the initial acquisition cost of ACT and US$0.34 to RDTs; in Kenya, they added US$0.24 to the acquisition cost of ACT and US$0.19 to RDTs (normalized to US$1). Total supply chain costs accounted for more than 30% of the initial acquisition cost of the products in some cases and these costs were highly sensitive to product volumes. The major cost drivers were found to be labour, transport, and utilities, with health facilities carrying the majority of the cost per unit of product. Product volumes should be considered when costing supply chain functions rather than dollar value. Further work is needed to develop extrapolative costing models that can be applied at country level without extensive micro-costing exercises.

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