Presentation is loading. Please wait.

Presentation is loading. Please wait.

1 GLOBAL HEALTH SUPPLY CHAINS SCTL: San Jose, Costa Rica July 21st, 2009.

Similar presentations


Presentation on theme: "1 GLOBAL HEALTH SUPPLY CHAINS SCTL: San Jose, Costa Rica July 21st, 2009."— Presentation transcript:

1 1 GLOBAL HEALTH SUPPLY CHAINS SCTL: San Jose, Costa Rica July 21st, 2009

2 Central Medical Store (CMS) Health Centre /ICTC Central/National Provincial/District Site Product Registration Forecasting / Quantification Procurement Forecasting / Quantification Procurement Storage Inventory Management Transportation Storage Transportation Inventory Management Storage Transportation Inventory Management Dispensing Storage Inventory Management Dispensing Product Flow TYPICALLY MOH SCM INVOLVES ACTIVITIES AT 3 DIFFERENT LEVELS Central Co-ordination Guidance / Direction Target Setting Procure / Store & Distribute SC Activities at each level Focus at each level M&E consolidation Provincial Budget Mgmt Liaison between Sites & Central Storage & Distribution Patient Test, Care & Treatment Report Completion Request & receive Commodities Storage Data Flow Ministry Of Health Provincial/ Regional WH Hospital/ Hospital Lab Health Centre/ ICTC

3 GLOBAL SUPPLY CHAINS Holistic Approach to SCM Outsourcing of non-core competencies Dynamic & Regular forecasting Strategic relationships with Suppliers Pooled Procurement/ Draw down qtys VMI/ DSI Supplier Hubs Direct Shipments/Cross Docking/ Merge Route optimization SW Integration Metrics used to identify weakness/set priorities. CI efforts Data turned into Information High Level of Awareness of SCM - w/in organization - in country eg: education - SCM strategies Silo’d view of SCM In-source everything CMS, Procurement etc Annual forecast/incorrect assumptions No supplier relationships or perf mgmt Annual Tendering w/single deliveries/no consolidation of procurement across system High buffer stocks at all levels held at various stocking location Manual processes/tools, typically using excel/access database with no integration Some metrics identified but not always appropriate or tracked, no CI Limited data availability and integrity Funding provided by multiple sources/with different priorities Low level awareness of SCM Vertical Supply Chains Decentralizing of SCM Where I have come from …. To where I am now ….

4 THE GAP CONTINUES TO WIDENED BETWEEN DELVEOPED WORLD AND DEVELOPING WORLD SUPPLY CHAINS Private Sector/High Income Focus on supply chain as competitive advantage / increase profits Outsourcing allows focus on core competencies and specialization Massive cost savings Reduction in inventory at all points in chain (cashflow benefits) Concurrent with Enhanced customer service - Shorter lead times - Increased customization - Improved quality Health Systems Developing World Lack of HR/specialized SCM knowledge Poor communications/data integrity Absence of metrics for performance/progress Lack of strategic approach/ business framework Funding provided by multiple stakeholders whose priorities are not always aligned Exacerbated by Investment in vertical supply chains Push to decentralize Result Patients Go without Or have to purchase meds privately MOH/Donors Wasted investments/inefficiencies throughout system Lost opportunity to make more effective use of funds

5 5 CHARACTERISTICS OF GLOBAL HEALTH SUPPLY CHAIN New Product Introduction:  NPI = Forecasting & Procurement, limited focus on lifecycle planning  Timing = months for actual implementation  Uptake not very successful ending up with a lot of expired stocks Quantification:  Annual Forecast process using a month planning window  Limited consumption data available, unconstrained demand not included  Assumptions not always appropriate (eg: Malaria AMC, Ess Meds distribution history)  Forecast Accuracy is not tracked Procurement:  Tender 1/Year w/single deliveries & supplier selection driven by cost  Procurement processes are long cumbersome process driven by perceived transaction efforts  Payments are made up front, even for donor commodities  Funding from National Budget can be unpredictable and insufficient  Supplier Performance Management does not exist  Govt Procurement Guidelines can be restrictive and favour local organizations  Many hospitas/labs do their own procurement but do not utilize Pooled procurement to leverage economies of scale

6 6 CHARACTERISTICS OF GLOBAL HEALTH SUPPLY CHAIN Storage:  Utlize CMS concept - central distribution to provincial warehouses & sites  Require sufficient space to store upto 12 months of inventory  Poor storage facilities and in many cases insufficient storage  Storage & Distribution costs are based on % of commodity prices not activity based costs  CMS are typically parastatal and can be very bureaucratic with no revenue recovery models Inbound/Outboun d Logistics Distribution:  Customs Clearance can be cumbersome /Product waivers required for some commodities  Different trucks used for different commodities, no optimization of transportation /routes  Cold Chain challenges in rural areas  Reverse Logistics doesn’t occur very effectively Inventory Mgmt:  High buffer stock levels - typically 2-3 months at site, 2-3 months at provincial level and 6 months= at central  Inventory Balancing /Redistribution doesn’t happen very well and is usually through an informal process  Little or no proactive management or tracking of Excess, Expired & Stockouts  Ongoing Shortages of commodities such as gloves, due to inaccurate ess meds lists  Stock outs monitored at National Level not so much as site level  ARVs tend to have excess/expired as opposed to shortages  Many times stock turns up in Private Sector Clinics

7 7 CHARACTERISTICS OF GLOBAL HEALTH SUPPLY CHAIN Technology  Fragmented systems and usually utilizing NGO developed tools  Technology solutions focus on point solutions for Forecasting, Inventory Management, Data collection and are usually excel/access data base  Focus on central level not site level Resources:  Little awareness of SCM as a profession  Typically Pharmacists are in charge of SCM activities w/little or no training  Very little synergies between partners/disease specific programs & primary health care systems  Task shifting needs to occur especially in resource constrained settings  Many personnel have multiple jobs  Salary inequities amongst MoH programs due to donors  Poor communications across the supply chain  People who gain from not fixing the issues Data:  Data collection is in place for disease specific programs, but little information is available  Accuracy & completeness of data is questionable  Little or no data analysis is done except for reporting to the donors  Reports used for order fulfillment, however order qtys are typically determined based on patient data Policy:  Treatment Guidelines/ Essential Meds list not updated on a regular basis  Payment processes  Procurement tendering - favor local suppliers

8 VERTICAL SUPPLY CHAINS LIKE THIS EXIST IN MOST DELVELOPING WORLD COUNTRIES

9 RESULT OF POOR INFRACSTRUCUTRE, TRAINING AND LACK OF RESOURCES

10 BIGGEST IMPACT OF ALL: APPROX 2/3 OF SELECTED MEDS ARE UNAVAILABLE IN PUBLIC HEALTH FACILITIES ON AVERAGE AT ANY TIME* Average availability = 34.9% in the public sector and 63.2% in the private sector *across developing world excluding LAC/Caribbean Source: WHO, Health Action International, United Nations MDG8 Report

11 CHAI’s Supply Chain Strategy is to empower governments to build cost-efficient, effective and sustainable national health care supply chains 1.Ensure sustainability through increased awareness and continuous source of SCM skills/knowledge in country. E.g. SCM Curriculum/Accredition, SCM Mentoring 2.Leverage resources from developed world, private sector. E.g. Partnerships, Applying lessons learned 3.Turn data into information E.g. Develop technology roadmaps 4.Secure funding for SCM specific programs, to help demonstrate effective solutions

12 12 EXAMPLES OF SCM ISSUES IN COUNTRY India redistributes on a monthly basis as oppose to having the supplier ammend their delivery qtys each quarter India - Cold Chain for HIV Kits compromised because fridge isnt working Many countries, testing doesn’t occur because they run out of reagents or machines are broken Swaziland distributes ARVs monthly, but ess meds only every 2-3months if the trucks are in working order Botswana/Cambodia forecast Malaria using average monthly consumption GF encourages procurement of high volume, single deliveries to achieve lowest cost GF encourages up front payment to suppliers PEPFAR training objectives are based on # of personnel trained not the effectiveness of the training Per diem culture exists in training/workshops Unconstrained demand is not captured especially for essential meds in Mozambique if you are sick, it is best to have HIV, because you know you will get treated Liberia is constantly running out of gloves Communications between site & central are broken down and a lack of trust exists 10-30% of drug costs are allocated to storage and distribution of drugs for GF Decisions are driven by budet & project not by commodity requirements Public Health SC has been weakened by disease specific programs

13 Major institutional donors providing funding for health systems PARTNERS AND DONORS INVOLVED IN SUPPLY CHAIN MANAGEMENT ACTIVITIES Key implementing agencies engaged in health system strengthening GFATM PEPFAR USAID AUSAID DFID World Bank SCMS:Typically focused on Forecasting & Procurement at the national level JSI/JSI DELIVER:Logistics focused, conducts assessments and develops tools (eg: Qantamed, Pipeline) MSH: MIS focused, usually on Inventory management tools, also an implementer of GMS Technical Assistance WHO: Technical Assistant for PSM Plans UNICEF: Acts as Procurement Agent R8 procurement/SCM = $172m or 8.7% of total phase one $185m in 2007 to PFSCM (runs SCMS) Funds DELIVER, with JSI in 38 countries (focus on contraceptives) $100m 6 years No distinct SCM budget but incorporated into many activities


Download ppt "1 GLOBAL HEALTH SUPPLY CHAINS SCTL: San Jose, Costa Rica July 21st, 2009."

Similar presentations


Ads by Google