Drug supply management

1. DRUG SUPPLY MANAGEMENT
BY HASHIM GULA (B.PHARM)
1

2. CHAPTER ONE
DESCRIBING THE
PHARMACEUTICAL SUPPLY
CHAIN CYCLE
2

3. INTRODUCTION
 Drug: means any substance or mixture of
substances used in the;
 diagnosis,
 treatment,
 prevention of a disease in man or animal.
 Medical equipment: these are permanent or re-
usable materials that can be used for longer period.
 E.g. delivery set, tooth extraction set, dressing set,
scissors, forceps, sterilizers (oven, autoclaves)
3

4. INTRO…
 Medical supply: means any article that may be
used for diagnosis or treatment of disease in man
or animal.
 These are consumables.
 disposable syringe with needles,
 Gloves (sterile, examination and utility)
 Suturing materials (cat gut, silk) etc......
 Cleaning and disinfecting supplies
4

5. INTRO…
 Management: is the process of setting and
achieving goals through execution of five basic
functions of management. these includes;
 Planning
 Organizing
 Staffing
 Directing
 Controlling
 It is process that utilizes human, financial and
material resources to obtain the desired results or
goals.
 Management is an integral process and it is difficult
to put its functions neatly in separate. 5

6. 1. Planning - The ongoing process of developing the
organization's mission and objectives and determining how
they will be accomplished.
2. Organizing - Establishing the internal organizational
structure of the organization.
The focus is on division, coordination, and control of tasks
and the flow of information within the organization.
1. Staffing - Filling and keeping filled with qualified people all
positions in the HSO. Recruiting, hiring, training, evaluating
and compensating etc.
2. Directing - Influencing people's behavior through
motivation, communication, group dynamics, leadership
and discipline.
3. Controlling - A process of establishing performance
standards, measuring and reporting actual performance,
comparing the two, and taking corrective actions. 6

7. INTRO…
What is Supply chain Management?
o Can be viewed as the active management of supply
chain activities
 To maximize customer value and
 Achieve a sustainable competitive advantage.
o In simple terms;
• It is the coordination of production, inventory
location and transportation among the participants
in a supply chain to achieve the best efficiency for the
market being served.
7

8. INTRO…
Why drug supply management (DSM)?
 Because lack of access to medication
 Irrational drug use
 DSM is needed as it is concerned with practical
ways in which high quality essential drugs are
 available,
 affordable and
 used rationally. 8

9. INTRO…
Why worry about drugs and their management?
 Drugs save lives and improve health.
 Drugs promote trust and participation in health
services.
 Drugs are costly for individuals, households,
government health institutions, country.
 Drugs are different from other consumer products.
 Substantive improvements in the supply and use of
drugs are possible.
9

10. INTRO…
Important lessons in drug management
 National drug policy provides a sound foundation for
managing drug supply
 Wise drug selection underlies all other improvements
 Effective management saves money and improve
performance
 Rational drug use requires more than drug information
 Systematic assessment and monitoring are essential
10

11. 1.1.ESSENTIAL MEDICINE
CONCEPT AND NATIONAL
DRUG POLICY
11

12. 1.1.1 CONCEPTS OF ESSENTIAL
MEDICINES
Objective
 Explain essential medicine concept
12

13. CONCEPTS…
 Essential medicines are those that satisfy the
priority health care needs of the population.
 Essential Medicines;
 save lives,
 reduce suffering and
 improve health, but only when they are:
 of good quality,
 safe,
 effective,
 available and
 properly used by providers and patients.
13

14. CONCEPTS…
Selection criteria; Essential medicines are selected with
due regard to;
 disease prevalence,
 evidence on efficacy and safety, and
 comparative cost-effectiveness.
Purpose; Essential medicines are intended to be available
within the context of functioning health systems at;
 all times in adequate amounts
 in the appropriate dosage forms
 with assured quality and adequate information
 At a price the individual and the community can afford
14

15. CONCEPTS…
Historical Background
 During and soon after WWII “Miracle”
 However, the miracles were for the minority
 there was gap in access to drugs
 Series of drug-induced disasters
 Some of the complaints in the early nineteen seventies
were:
 No access to most needed drugs
 No links between drugs and health needs
 Rising costs of pharmaceuticals
 Uneven rural-urban distribution
15

16. CONCEPTS…
Against this background; Birth of essential drug
concept
 WHO adopted the concept with the view that
essential medicines should be given priority.
 In 1975- WHO defined essential medicines
 In 1977, WHO published the first model list of
essential drugs
 List is revised every 2-3 years by WHO expert committee
 In 1978, historic goal of ‘health for all by 2000’
essential medicines were recognized as one of the
eight elements of primary health care.
16

17. CONCEPTS…
Essential medicine concept and its principles
Concept:
 A limited range of carefully selected medicines leads to
 better health care,
 better drug management and
 lower costs.
17

18. CONCEPTS…
 Principles:
 The vast majority of health problems can be
treated with a small, carefully selected number of
drugs.
 Most practitioners routinely use fewer than 200
drugs.
 Supply activities can be carried out most
efficiently for a limited number of pharmaceutical
products.
 Patients can be better informed when confronted
with limited drugs.
18

19. 19

20. 1. Rational
selection
4. Reliable
health and
supply
systems
2. Affordable
prices
3. Sustainable
financing
ACCESS
20

21. 1.1.2. National drug policy
and medicine financing
21

22. LEARNING OBJECTIVES
At the end of this chapter, students will be able to:
 Define national drug policy
 Narrate the core objectives and key strategies of a
National Drug Policy
 Discuss the process of National Drug Policy
development
 Identify components of a national drug policy
 Review national drug policy of Ethiopia
22

23. 1.1.2. NATIONAL DRUG POLICY
CONCEPTS
Policy :
 Is a commitment to goal and guide to action .
 It is the way how to achieve the objective of certain plan.
National drug policy:
 Is a document specified by a government for
pharmaceutical and other health sectors to satisfy the health
care need of the country.
 It expresses and prioritizes the medium- to long term goals
 set by the government for the pharmaceutical sector, and
 identifies the main strategies for attaining them.
23

24.  It covers both the public and the private sectors,
and involves all the main actors in the
pharmaceutical field.
 A national drug policy as a common framework
 to solve problems in pharmaceuticals
 to address the sectors problems comprehensively
 It is very difficult to implement a health policy
without a drug policy.
24

25. RATIONALE
 Health is a fundamental human right.
 Access to health care, which includes access to
essential drugs, is a prerequisite for realizing that right.
 Despite the obvious medical and economic importance of
drugs; there are still widespread;
 lack of access,
 poor quality,
 irrational use and waste.
25

26. RATIONALE…
1. Lack of access to essential drugs
 WHO has estimated that at least one-third of the
world’s population lacks access to essential drugs;
 In poorer areas of Asia and Africa this figure may
be as high as one-half
 2 Millions of children and adults die each year from
diseases that could have been prevented or treated
with cost-effective and inexpensive essential drugs.
26

27. RATIONALE…
2. Poor quality
 Inadequate drug quality assurance systems
 Substandard and counterfeit products
 Inappropriate handling, storage and distribution can
alter the quality of drugs.
27

28. RATIONALE…
3. Irrational use of drugs
 No right medicine in the right dosage when needed
 Many people are prescribed and dispensed, drugs that
are not appropriate for their needs.
 use several drugs (poly pharmacy)
 use drugs that carry unnecessary risks.
 The irrational use of drugs may unnecessarily prolong or
even cause ill-health and suffering, and results in a waste
of limited resources.
28

29. OBJECTIVES OF A NATIONAL DRUG POLICY
The general objectives of a national drug policy are to
ensure:
Access:
 Equitable availability and affordability of essential drugs
Quality:
 The quality, safety and efficacy of all medicines
Rational use:
 The promotion of therapeutically sound and cost-effective
use of drugs by health professionals and consumers.
The more specific goals and objectives of a national policy
will depend upon the country situation, the national health
policy, and political priorities set by the government.
29

30. NATIONAL DRUG POLICY DEVELOPMENT
PROCESS
Steps of formulating NDP
Step 1: Organize the policy process:
 The ministry of health take the lead role in formulating a
national drug policy
 Decide how to organize the development process that
will identify the structure of the policy, major objectives
and priority components.
 Identify all the interested parties ;
 that need to be involved,
 the necessary resources, and
 how these can be obtained
30

31. POLICY PROCESS
 These include:
 other ministries (higher education, trade, industry),
 doctors, pharmacists and nurses,
 local and international pharmaceutical industries,
 drug sellers,
 nongovernmental organizations (NGOs), academia
 drug regulatory agency, the media etc…
31

32. POLICY PROCESS…
Step 2: Identify the main problem
 small team of experts from the ministry of health
and other disciplines
 examine the situation systematically, to identify the main
problems, make recommendations.
 their recommendations, discussed at one or more
multidisciplinary workshops, in order to formulate
consolidated advice to the government.
32

33. POLICY PROCESS…
Step 3: Make a detailed situation analysis
• Further analyze the source of the problems,
• in order to identify potential solutions,
• choose the most appropriate strategies,
• set priorities, and serve as a baseline for future systems
of monitoring and evaluation.
Step 4: Set goals and objectives for a NDP
 Once the main problems have been defined, goals can
be set and priority objectives identified
33

34. POLICY PROCESS…
Step 5: Draft the text of the policy
 It should set out the general and specific objectives of the
policy.
Step 6: Circulate and revise the draft policy
 circulated for comments, first within the ministry of health,
then in other government, NGOs & to relevant institutions.
34

35. POLICY PROCESS…
Step 7:
Secure formal endorsement(permission) of the policy
Step 8: Launch the national drug policy
35

36. THE FORMULARY PROCESS
 Once a national essential drugs list has been
agreed upon and adopted,
 The next step is the development of STG and a
formulary manual.
 Essential Drug List: is a list of drugs considered
optimal treatment choices to satisfy the health care
needs of a given population.
 It can be used for a given health facility, or for a
group of health facilities to indicate which drugs
should be procured and prescribed.
36

37. FORMULARY …
 It is a handy reference that contains selected information
that is relevant to;
 the prescriber,
 dispenser and,
 nurse or other health worker.
 It commonly includes;
 the generic name of a drug,
 its indications for use,
 Dosage schedules,
 contraindications,
 side effects, and
 important information that should be given to the
patient. 37

38. FORMULARY…
 Standard Treatment Guidelines:
 are systematically developed statements that
assist prescribers in deciding on appropriate
treatments for specific clinical problems.
 Name of disease
 Characteristics of disease
 Choices of medications with their dosage schedules
 STG is disease focused but EDL is drug focused
38

39. KEY COMPONENTS OF A NATIONAL DRUG
POLICY
 A national drug policy is a comprehensive framework in
which each component plays an important role in
achieving one or more of the general objectives of the
policy
 The policy should balance the various goals and
objectives, creating a complete and consistent entity.
 For example, access to essential drugs can only be
achieved through;
 rational selection,
 affordable prices,
 sustainable financing and
 reliable health and supply systems. 39

40. KEY COMPONENTS…
 Selection of essential drugs
 Affordability
 Drug financing
 Supply systems
 Drug regulation
 Rational use of drugs
 Research
 Human resource development
 Monitoring and evaluation
40

41. KEY COMPONENTS…
1.Selection of essential drugs:
Key policy issues are
 The adoption of the essential drugs concept to
identify priorities, for government involvement in
the pharmaceutical sector, and especially for drug
supply in the public sector and for reimbursement
schemes
 Procedures to define and update the national list(s) of
essential drugs
 Selection mechanisms for traditional and herbal
medicines.
41

42. KEY COMPONENTS…
2.Affordability;
Affordable prices are an important prerequisite for ensuring
access to essential drugs in the public and private sectors.
Key policy issues are:
 Government commitment to access through increased
affordability;
 For all drugs: reduction of drug taxes, tariffs and pricing policy;
 For multi-source products: promotion of competition through
generic policies, generic substitution and good procurement
practices;
 For single-source products: price negotiations, competition
through price information and therapeutic substitution. 42

43. KEY COMPONENTS…
Challenges
 New essential drugs are often expensive:
 Market failure:
 Information imbalance;
 Failure of competition;
 Externalities;
 International trade agreements :
 Industry consolidation
43

44. KEY COMPONENTS…
3.Drug financing
Drug financing is essential component of policies to improve
access to essential drugs.
Key policy issues are:
 Commitment to measures to improve efficiency and reduce
waste;
 Increased government funding for priority diseases, and for
the poor and disadvantaged;
 Promotion of drug reimbursements as part of public and
private health insurance schemes;
 Use of and limits of development loans for drug financing;
 Guidelines for drug donations.
44

45. KEY COMPONENTS…
Challenges
 Inadequate resources:
Ensuring stable and adequate financing for health
care is becoming increasingly difficult as a result of:
 Economic pressures,
 Continued population growth and
 The growing burden of disease
45

46. KEY COMPONENTS…
Drug financing options
 Improving efficiency and reducing waste
 Increasing government funding
 Prepayment schemes and health insurance
 Development loans
 Donations
46

47. KEY COMPONENTS…
4.Supply Systems
Key policy issues are:
 Public–private mix in drug supply and distribution
systems;
 Commitment to good pharmaceutical procurement
practices in the public sector;
 Publication of price information on raw materials
and finished products;
 Drug supply systems in acute emergencies;
 Inventory control, prevention of theft and waste;
 Disposal of unwanted or expired drugs.
47

48. KEY COMPONENTS…
5.Drug regulation
Key policy issues:
 Government commitment to drug regulation,
including the need to ensure a sound legal basis
and adequate human and financial resources;
 Independence and transparency of the drug
regulatory authority.
 Commitment to good manufacturing practices,
inspection and law enforcement;
 Commitment to regulation of drug promotion; 48

49. KEY COMPONENTS…
Core Elements of Drug Regulation
 Quality
 Safety
 Efficacy
 Information
49

50. KEY COMPONENTS…
6.Rational use of drugs
 The rational use of drugs means that patients
receive medicines;
 appropriate to their clinical needs,
 in doses that meet their individual requirements,
 for an adequate period of time, and
 at the lowest cost to them and their community.
 Efforts to promote rational drug use should also
cover the use of traditional and herbal medicines.
50

51. KEY COMPONENTS…
Key policy issues are:
 Development of evidence-based clinical guidelines.
 Establishment and support of drugs and therapeutics
committees.
 Promotion of the concepts of essential drugs, rational
drug use and generic prescribing in basic and in-service
training of health professionals.
 The need and potential for training of informal drug
sellers.
 Continuing education and independent, unbiased drug
information.
 Consumer education, and ways to deliver it. 51

52. KEY COMPONENTS…
Challenges:
A. Complexity of the issue:
B. Conflicting interests:
C. Lack of independent information
D. Inappropriate drug promotion
E. Unrestricted availability of prescription
drugs
52

53. KEY COMPONENTS…
Core strategies to improve drug use
 Strategies to promote rational drug use can be;
 Educational; Rational use depends on the
knowledge, attitudes and practices of health care
practitioners and consumers.
 Managerial ;Adherence to the clinical
guidelines; like Standard treatments, essential
drugs lists, dispensing standards
 Regulatory; Evaluation of drugs for market
approval and scheduling.
53

54. KEY COMPONENTS…
 Reading assignment
 7. Research
 8. Human Resource
 9.Monitoring and Evaluating.
54

55. Image source: Jad Davenport
55

56. ETHIOPIAN NATIONAL DRUG POLICY AND
ITS IMPLEMENTATION
Objectives
 To meet the country’s demand of essential drugs/ and
ensure access
 To ensure safety, efficacy and quality
 To develop domestic manufacturing capacity directed to
export
 To expand human resource training, Research &
Development
 To devise ways and means to utilize traditional medicine
56

57. ETHIOPIAN NATIONAL DRUG POLICY 1993
 Create favourable conditions for local manufacturers,
importer/distributors
 Establish an effective system of drug regulation
 Establish system of rational use of drugs
 Devise a program for the training of professionals
 Conduct a coordinated research on traditional medicine
 Create favourable condition for technology transfer
 Create favourable condition for export
57

58. ETHIOPIAN NATIONAL DRUG POLICY…
Strategies
1.Selection of drugs
 Based on the country’s
 health problems,
 trained HR, Financial resources and
 infrastructure
2. Drug Supply
 Government shall establish a drug procurement and
distribution enterprise/PFSA
 Domestic Drug procurement and distribution shall be
carried out by networks established at regional
level/PFSA 58

59. ETHIOPIAN NATIONAL DRUG POLICY…
3.Drug administration and control -FMHACA
 Quality standards setting
 Drug information
 Inspectors assignment
 Registration, classification and licensing to be carried out
by responsible body
59

60. ETHIOPIAN NATIONAL DRUG POLICY…
4. Human Resource training
 Formal pharmacy training
 Strategy for upgrading/Diploma to Degree in different
Universities
 On job training and continuation education
5. Drug information and promotion
 Monitoring of the content and distribution of DI to
professionals and the public
 Current and accurate information and reference materials
on drugs shall be produced and distributed to
practitioners in the field
60

61. ETHIOPIAN NATIONAL DRUG POLICY…
6. Drug Use
 List OTC drugs
 Standard prescription
 Generic prescribing encouraged
 Generic substitutions for Brand drugs by pharmacists
 Public awareness on drug use/Radio/ TV
61

62. ETHIOPIAN NDP REVISION: THE NEED
 The country is still overwhelmingly dependent on
importation of drugs
 The number and distribution outlets shows
mismatch to the needs.
 Enforcement capacity is its lowest level to fight
illegal drug trade and encourage expansion of legal
activities.
 Shortage of qualified and experienced
management and technical personnel in public
health facilities and industry.
62

63. ETHIOPIAN NDP REVISION: THE
NEED…
 Unsuitable and insufficient distribution and storage
facilities.
 Inadequate systematic and continuing education
coupled with inadequate reference and learning
materials.
 Shifting in health financing strategies from out of
pocket expenditure by patients to health insurance
schemes 63

64. 1.2. PHARMACEUTICAL SUPPLY
CHAIN
Objectives :
 Define supply chain and supply chain
management.
 Describe the supply chain concept
 Explain the key parts and flows of supply chain
 Understand the need of supply chain
management
64

65. SUPPLY CHAIN…
Supply Chain
 Is a system of organizations, people, technology,
activities, information and resources involved in
moving a product or service from supplier to
customer.
 A supply chain is a network of retailers,
distributors, transporters, storage facilities, and
suppliers that participate in the production,
delivery and sale of a product to the consumer.
65

66. SUPPLY CHAIN…
 Supply chain activities transform natural
resources, raw materials and components into a
finished product that is delivered to the end
customer.
 In simple terms, a supply chain is the link
between a firm or business and its suppliers
66

67. SUPPLY CHAIN…
 A supply chain has three key parts:
 Supply; which focuses on the raw materials
supplied to manufacturing, including how, when,
and from what location.
 Manufacturing; which focuses on converting these
raw materials into finished products.
 Distribution; which focuses on ensuring that the
products reach the consumers through an
organized network of distributors, warehouses, and
retailers.
67

68. SUPPLY CHAIN…
What is Supply chain Management?
 Is concerned with the management and control of
the flows of ;
 material,
 information, and
 finances in supply chains.
 Is the oversight of materials, information, and
finances distributed from supplier to consumer.
 It also includes all the necessary steps between the
supplier and the consumer.
 It involves coordinating this flow of materials within
a company and to the end consumer.
68

69. SUPPLY CHAIN…
 The Council of Supply Chain Management
Professionals defines supply chain management as
follows:
 “Supply chain management encompasses the planning
and management of all activities involved in;
 sourcing and procurement,
 conversion, and
 all logistics management activities”.
69

70. 1.2.2. CONCEPTS OF SUPPLY
CHAIN MANAGEMENT
The concept is based on two core ideas;
 The first; practically every product that reaches an
end user represents the cumulative effort of
multiple organizations.
 SC is the alignment of firms that bring products or
services to market
 It includes the manufacturers, suppliers,
transporters, warehouses, retailers, and customers
themselves.
70

71. CONCEPTS…
 The second; SCM involves the active management
of SC activities to maximize customer value and
achieve a sustainable competitive advantage.
 It represents a conscious effort by the supply chain
firms to develop and run supply chains
71

72. CONCEPTS…
 The organizations that make up the supply chain
are “linked” together through physical flows and
information flows.
 PF- involves the transformation, movement, and
storage of goods and materials.
 IF- allows the various SC partners to coordinate
their long-term plans, and to control the day-to-day
flow of goods and material up and down the SC.
72

73. 1.2.3. OBJECTIVE OF SUPPLY
CHAIN MANAGEMENT
 A supply chain is a global network of organizations
that cooperate to improve the flows of material and
information between suppliers and customers;
 At the lowest cost and
 The highest speed.
 The final objective of a supply chain is
customer satisfaction.
 The main purpose of the supply chain is
to maximize overall value generated.
 Value is the difference between ;
 what the cost supply chain incurs and
 the worth end product has to the customer.
73

74. OBJECTIVE…
Challenges for Drug Management
 The major challenges for policy-makers and
managers in the area of drug supply management
are:
1.Achieving Financial Sustainability:
 This is realized when expenditures and financial
resources balance and are sufficient to support a
given level of demand.
74

75. OBJECTIVE…
 In the absence of such a balance the health system
is left with only four options:
 Improve efficiency,
 Increase financial resources,
 Reduce demand, or
 Accept a decline in quality of care.
75

76. OBJECTIVE…
2. Improving Efficiency in Public Drug Supply:
 public-sector drug supply in many countries
continues to be challenged by
 Ineffective management systems,
 Lack of staff incentives,
 Inability to control fraud and abuse,
 Political pressures that channel drug supplies to
better-off areas and
 Insufficient drug selection and use.
76

77. OBJECTIVE…
3. Changing the Perceptions and Behaviors of
Providers, Patients and the Public:
 Major problems with this regard include:
 Prescribing and dispensing incorrect, harmful, or
unnecessary drugs;
 Failure by patients to use needed medications correctly;
and
 Wasteful or harmful self-medication practices.
77

78. OBJECTIVE…
4. Reorienting the Role of Government:
 A challenge for the public sector is to work with the
private sector and NGOs to achieve universal
access to EDs and RUDs.
 This involves;
 Mutual understanding,
 Constructive partnerships, and
 The right incentives.
 Greater coverage of essential drug need by the
private sector promotes
 The use of public resources on prevention, control of
communicable diseases, and on the poorest segments of
the population. 78

79. OBJECTIVE…
5. Regulating Safety, Efficacy and Quality:
 Many governments in the developing world are
characterized by very low regulatory capacities
which are characterized by; Absence or lack of;
 Legislative basis,
 Trained personnel,
 Specific technical resources
 Adequate funding, and
 Public commitment to establishing basic standards.
79

80. OBJECTIVE…
why drugs should given special emphasis? and
why they should be managed properly?
1. Drugs save lives and improve health:
 Most of the diseases can be prevented, treated, or
at least alleviated with cost effective essential
drugs.
2. Drugs promote trust and participation in the
health services:
 The presence of drugs and their use to save the
lives of sick members of the society increases the
credibility of health worker
80

81. OBJECTIVE…
3. Drugs are costly:
 Represent the major out-of-pocket health
expenditures at an individual level, and the one of
the highest health expenditures at national level.
4. Drugs are different from other consumer
products:
 One should not expect drugs to be left to market
forces just like other consumer products due to the
following reasons:
81

82. OBJECTIVE…
 The drug is prescribed by a clinician or
recommended by a pharmacist.
 The consumer is not trained to judge its safety,
appropriateness, quality, or value for money.
 Fear of illness can lead patients to demand from
health workers, or to buy for themselves.
 The consumer often cannot judge the likely
consequences of not obtaining a needed drug
82

83. 1.2.4. THE NEED FOR LOGISTICS
What is Logistics?
 Is the work required to move and position inventory
through out a supply chain
 As such, it is a subset of and occurs within the
broader framework of a supply chain.
 Inventory is the stock of an item on hand at
particular location
83

84. LOGISTICS…
 It is the combination of a firm’s order management,
inventory, transportation, warehousing, materials
handling, and packaging as integrated throughout a
facility network.
 Integrated logistics serves to link and synchronize
the overall SC as a continuous process and is
essential for effective SC connectivity.
84

85. LOGISTICS…
 Logistics management includes a number of
activities that support the six rights. The purpose of
logistics system is to meet six rights of logistics.
 The Six Rights of Logistics
1) The RIGHT goods
2) In the RIGHT quantities
3) In the RIGHT condition delivered
4) To the RIGHT place
5) At the RIGHT time
6) For the RIGHT cost
85

86. LOGISTICS…
Major activities in the logistics cycle
1. Serving customers: Everyone who works in
logistics must remember that they select, procure,
store, or distribute products to meet customer
needs.
2. Product selection: In any health logistics system,
health programs must select products.
3. Quantification: After products have been
selected, the required quantity and cost of each
product must be determined
4. Procurement: After a supply plan has been
developed as part of the quantification process,
quantities of products must be procured 86

87. LOGISTICS…
5. Inventory management: storage and
distribution; After an item has been procured and
received by the health system or program, it must be
transported to the service delivery level where the
client will receive the products.
6. Logistics management information systems; is
Heart of the logistics system. Information is the
engine that drives the logistics cycle; without
information, the logistics system would not run
smoothly
87

88. LOGISTICS…
7. Other activities at the heart of the logistics
cycle
 Organization and staffing
 Budget;
 Supervision;
 Monitoring and evaluation
88

89. 1.3.COMPONENTS OF THE PHARMACEUTICAL SUPPLY
CHAIN MANAGEMENT
89

90. COMPONENTS…
Objectives
 Discuss components of drug management cycle
(selection, quantification, procurement, distribution
and drug use)
90

91. COMPONENTS…
Overview
 Managing drug supply is organized around the
following basic functions:
 Selection
 Quantification
 Procurement
 Distribution and
 Use
91

92. 92

93. 1.DRUG SELECTION
 Is a process of deciding the type of needed drug
products.
 Enforcing reasons for drug selection:
 Up to 70% of pharmaceuticals in the world market are
duplicate and non-essential
 Availability of so many drugs is confusing for professionals
and leads to inconsistency in practice
 Large number of non-essential drugs decrease purchasing
power
93

94. SELECTION…
 Drug selection can lead to:
 Better supply
 More rational prescribing and dispensing
 Lower cost
 More rational patient use
 So careful selection of drugs has:
 Cost implications
 Clinical implications
94

95. SELECTION…
Criteria for drug selection
 Relevance to the pattern of prevalent diseases
 Facilities (diagnostic facilities, treatment facilities,
physical facilities for distribution and facilities)
 Training and experience of available personnel
 Drug products only for which sound and adequate
scientific data on efficacy, safety, quality, bioavailability
and stability are available;
95

96. SELECTION…
 Possibilities of easy and prompt procurement
and local manufacture
 Drug products with widest possible coverage for
the prevailing diseases
 Drugs with affordable cost by considering total
cost of treatment not only the unit cost of drug(s)
 Single ingredient drug products
96

97. SELECTION…
 When two or more drugs seem similar in the above
respects selection can be based on:
 The most thoroughly investigated drug
 Drug(s) which offers better patient compliance
 Drug(s) which are locally available
97

98. SELECTION…
Source of drug information
 Drug information sources categorized in to three
classes.
Primary sources:
 Is the foundation on which all other information is
based;
 E.g. Reports of clinical drug trails, Case repots
Pharmacological research.
Secondary sources: -
 Function as a guide to review of the primary
literature.
 E.g. – Review articles, Abstracts (International
pharmaceutical abstracts). 98

99. SELECTION…
Tertiary / general sources ;–
 present documented information is (condensed
format).
 E.g. – formulary manuals, Text books, General referent
books, Drug bulletin, Drug compendia.
99

100. 2.DRUG QUANTIFICATION
 It is the process of determining the amount of drug
products needed for the purpose of procurement.
 Appropriate drug quantification can avoid:
 Shortage of (out of stock) of drugs as well as
 Overstock of drugs.
100

101. QUANTIFICATION…
Indicators of poor quantification:
 Shortage of drugs
 Overstocking of drugs
 Irrational prescribing
 Inefficient budget use
 Suppression or distortion of demand
101

102. QUANTIFICATION…
Quantification Methods
The four general methods for quantification are:
 Consumption method
 Morbidity method
 Proxy consumption/adjusted consumption method
 Service level projection of budget requirements
102

103. QUANTIFICATION…
Selection of the appropriate quantification
method requires considering:
 Advantages and disadvantages
 The conditions under which each method can be
applied
 The sets of data required
 The organization of the drug supply system
 Additional purposes
103

104. 3. DRUG PROCUREMENT
 It is the process of acquiring drug product through
purchase, manufacture or donation.
 It is a major determinant of drug availability and the
total health cost.
104

105. PROCUREMENT…
An effective procurement process should:
 Procure the right drug in the right time
 Obtain the lowest possible purchase price
 Ensures that all drugs procured meet
recognized standard quality
 Arrange timely delivery to avoid shortage and
stock out
 Achieve the lowest total cost
105

106. PROCUREMENT…
Operational Principles of Good Pharmaceutical
Procurement
 There are operational principles for good
pharmaceutical procurement clustered in to
four:
1) Efficient and transparent management
2) Financing and competition
3) Drug selection and quantification
4) Supplier selection and quality assurance
106

107. PROCUREMENT…
Efficient and transparent management
 Separation of key procurement functions and
responsibilities
 Transparency, written procedures and using explicit
criteria to award contracts.
 Planning procurement and monitoring its
performance
107

108. PROCUREMENT…
Procurement Methods
 All pharmaceutical procurement methods fall into
one of the following four basic categories:
I. Open tender
II. Restricted tender
III. Competitive negotiation
IV. Direct procurement
108

109. 4. DRUG DISTRIBUTION
 Is a continuous process of receiving drugs from the
supplier and moving them safely /securely to the
many point in the health care system at which the
drugs will be dispensed to patients.
 A well-run distribution system should:
 Maintain a constant supply of drugs
 Keep drugs in good condition
 Minimize drug loses due to spoilage and expiry
 Rationalize drug storage costs
 Use available transport as efficiently as possible
 Reduce theft and fraud
 Provide information for forecasting drug needs 109

110. THE DISTRIBUTION CYCLE
110

111. 5. DRUG USE
 Drug use is the process of:
 Prescribing
 Dispensing
 Patient use
111
Diagnosis/
Follow up
Prescribing
Dispensing
Adherence

112. USE…
 The rational use of drugs requires that patients
receive:
 medications appropriate to their clinical needs,
 in doses that meet their own individual requirements,
 for an adequate period of time,
 and at the lowest cost to them and to their community
112

113. USE…
Rational drug use involves:
 Appropriate indication
 Appropriate drug
 Appropriate dosage regimen
 Appropriate patient
 Correct dispensing
 Patient adherence
113

114. USE…
 What roles can you play as a pharmacist to
promote rational prescribing?
114

115. THANK YOU
115