lecture

1. RDF Quantification for 2014 EFY Organized by
EPSA in collaboration FMOH
December 17-18, 2020
J Hotel Adama

2. Goals and objectives
Goals:
• Preparation for quantification and supply planning(2014EBY) for Health
commodity managed through RDF.
• Evidence based, professional and reliable forecast of medicines, laboratory
reagents and medical supplies that drive procurement and financial management.
• To Plan the over all 2014 EBY quantification exercise from upstream to
downstream

3. Objectives: At the end of this Orientation participants will be able to
Explain principles and processes of quantification
and support HFs in their hubs to develop realistic
forecast in 2014EBY
Identify required data and their respective sources
for quantification and support HFs
Train, mentor and supervise HFs on processes of
data collection, organization, analysis, interpretation
validation and triangulation.
Support HFs on approaches of making
assumptions when quantifying needs in the
absence of certain data

4. Objectives ….
Support HFs how to work through DTC that involves
various health departments regarding their future
medicines, diagnostics and medical supplies requirements.
Support Health facilities on reconciliation of forecasts
with available budget; Undertake budget gap analysis
and applications of VEN, ABC analyses or other suitable
techniques.
Be a change agent by instituting strong forecasting and
supply planning in hospitals to achieve HSTP target of 100%
availability and reduction of expiry below 2%
4

5. Objectives …..
Strengthen systems for quantification of medicines,
Laboratory reagents and medical supplies
Enriching EPSA’s pharmaceuticals’ procurement list
for EFY2014 quantification exercise
Identify challenges, opportunities and possible
improvements around quantification process in HFs
Monitor and evaluate forecast and supply plan of
essential medicines, lab reagents and supplies
5

6. Quantification
Principles

7. Content
Quantification Definition
The Goal, Scope and rationale for Quantification
Steps in Quantification
Future Planned activity under quantification
 Signs of good and poor Quantification

8. What is Quantification?
• Quantification: is the process of estimating the quantity and cost of the
products required for a specific health program (or service) during a specific
period and determining when the products should be procured and distributed
to ensure an uninterrupted supply.
• Quantification is not a one-time, annual exercise that ends when the final
quantities and costs of the pharmaceuticals have been determined. It is an
iterative process with reviews and updates required year-round
• Quantification is a critical supply chain activity that links information on
services and pharmaceuticals from the facility level with program policies and
plans at the national level

9. Cont.…
Has 2 parts:
• Forecasting - estimating quantity required of each product to meet
demand for the forecast period
• Supply planning - adjusting quantities forecasted to determine
quantities to procure and time of delivery of the products

10. Goal for Quantification
• The ultimate goal of quantifying pharmaceutical requirement is to
ensure that appropriate medicines are available sustainably to treat,
promote and maintain the rational and economic use of medicines.
That means quantification:-
• Reduces stock out of products at different levels hence increases availability.
• Avoid overstock of products hence minimizes wastage rate.
• Promote rational use of pharmaceutical
• To reconcile the need of pharmaceutical and the available budget
• Ultimately satisfy the customers with limited budget sources

11. Rationale for Quantification
Eliminate stock out of health commodities
National program expansion
New guidelines, interventions, new programs
Change in list of medicines, dosage, and dosage forms
Prioritize the most critical requirements
Plan, mobilize and secure financial resources
 Guide timely, appropriate supply plans and procurement

12. Scope of the Quantification
• The quantification is national and includes all
pharmaceuticals (medicines, Medical Supplies, Laboratory
Products and routine Medical Equipment’s) that are included
in EPSA’s procurement list and are availed through RDF.

13. Steps in Quantification of Pharmaceuticals

14. Steps in Quantification…
1. Preparation
 Assemble a quantification team
Describe the program (program performance, policies & strategic plans)
Define the purpose & scope of the quantification exercise (products, timing)
Collect required data (for forecasting and supply planning)

15. Assemble a quantification team –
• During the preparatory phase, the hub quantification
team will do the following activities:
• Establish quantification team at hub level, Composed of Hub manager,
QTFOs, WIMC, WIMO LabOs, RHBs and/or ZHDs and partners.
• Collect, organize and analyses the following data
• Hub issue data
• Facility level issue data (from dagu sites, if possible)
• Hub and facility based order fill rate or requested Vs issued data
• Health facility request

16. Cont..
During the preparatory phase, the central quantification team
will do the following activities
• Revise the list of pharmaceuticals that will be included in the forecast by
considering the agency’s procurement list, commodities that are supplied in
health program, less essential items, strength duplications and other
considerations.
• Revise the unit price of all commodities and verify the final price list together
with Tender Management Directorate(By assessing the market)
• Prepare a sample size for hub support
• Prepare estimated budget need for site support and communicate with
management to mobilize the needed budget
• Together with FMOH, give orientation to federal hospitals and other high load
referral hospitals with regard to RDF quantification. DSM coordinators of the
selected will participate in the orientation and exercise on forecasting of RDF
commodities by using their real data during the orientation.

17. Cont…
•Collect, organize and analyses the following data
• Past three years hub issue data
• Past three years hub based and also national forecast
• Past three years procurement data
• Facility level issue data (from dagu sites, if possible)
• Hub and facility based order fill rate or requested Vs
issued data
• Price trend over the past five years
•Prepare a workshop and discuss the overall process
of the quantification with hubs and provide an
agreed time plan.

18. B) Describe the program
• current status, and performance of the program for which the
pharmaceuticals/ commodities are being quantified.
• a review of program goals, strategies, and priorities, and any
expansion plans or change in policies that may significantly
influence uptake of services and demand for commodities

19. C) Purpose & Scope of the Quantification
To provide data on specific commodity requirements and costs for the government’s
annual budget allocations
To advocate for resource mobilization for commodity procurement
To optimize existing budgets based on priority health problems to be treated
and the most cost-effective treatment approaches.
National/ Specific health facility
Time Period

20. •Different types of data and information will be
required at each step in the quantification
•The data and information may be collected through
•Interviews,
• Consultative meetings with key stakeholders
•Through existing reports (HMIS and LMIS) and
• Direct data collection at health facilities.
• Reviewing of different documents
D) Collect required data

21. 1. Data necessary for forecasting includes:
Logistic data Morbidity data Services data
 Facility level
Consumption data for
each pharmaceutical
 Hub level issue data
 Days out of stock per
product for the defined
period
 Wastage information
 Number of specific
diseases diagnosed or
treated in the health
facility
 Treatment and test
options
 Service expansion plan
or national targets
 Lab test methodologies
 Annual attrition or
migration rate
 number of visits,
 number of services
provided,
 lab tests conducted,
 treatment episodes,
 number of patients on
treatment
 List of working lab
equipment and usage
rates

22. 2. Data for Supply Planning
Data Needed Product information Supplier information Procurement information Distribution information
.The monthly forecasted
consumption
.National- or program-level stock
on hand
.Expiration dates of products in
stock
.Quantity on order: any
shipment quantities of
product(s) already on order, not
yet received
.Procurement lead time(s)
.Established shipment intervals
and current shipment delivery
schedule
.Established national- or
program-level maximum and
minimum stock levels
.Registration
status,
prequalification
status if
applicable
.Verify whether all
products are on
the National
Essential
Medicines List
.specific product
characteristics
(formulations,
dosages, number
of units per pack
size, unit cost, and
others)
.Supplier prices
.Supplier
packaging
information
.Supplier lead
times
.Shipping and
handling costs
.Procurement
mechanisms
(e.g.,
competitive
international
bidding/tender
ing, restrictive)
• Shipment
modalities
(air, sea,
land etc)
.In-country storage
and distribution
costs (if
applicable)
.In-country
sampling/quality
testing costs
• Customs
clearance

23. 2) Forecasting
Forecasting, the second step in the quantification process
Uses the data collected during the preparation step to estimate the quantity of each
product that will be used during each year of the quantification.
These quantities are the basis for calculating the total commodity requirements in the
supply planning step.
The forecasting step in a quantification exercise is a four-part process
Organize, analyze, and adjust the data.
Build and obtain consensus on the forecasting assumptions.
Calculate the forecasted consumption for each product.
Compare and reconcile results of different forecasts

24. Hub teams activities during the forecasting phase
• Select health facilities that will be supported based on the selection
criteria and list for which sites their result will be extrapolated.
• Disseminate the forecasting tool to sampled health facilities under
catchment
• Provide intensive support for selected sample health facilities

25. Cont..
• Aggregate the forecast result of supported health facilities
as per the Quantification tool
• Analyze the aggregated forecast and send the final hub
based forecast to central team on the agreed timeline

26. , Central team activities during the forecasting phase
 Provide intensive support to hubs
 Aggregate and analyses the hubs forecast by
comparing with previous years forecast, past three
years adjusted issue data, request Vs issue
 Prepare a validation workshop and agree with hubs
on the three years forecast result

27. 3) Supply Planning
used to estimate the total pharmaceuticals requirements and costs to be procured
To calculate this estimate,
 start with the forecasted consumption for each product from the forecasting step;
 existing stock on hand;
 any quantities of product already on order, but not yet received;
 the established maximum and minimum stock levels
 supplier lead times and
 buffer stock
Supply planning process
Organize and analyze data.
 Build supply planning assumptions.
Estimate total commodity requirements.
Develop supply plan.
Compare costs to available funding.

28. Organize and analyze data
Product related data Procurement
information
Distribution
information
Stock status
specific product
characteristics
(formulations,
dosages, shelf life,
temperature
requirements,
number of units per
pack size, unit cost,
and others)
.procurement
mechanisms (e.g.,
competitive
international
bidding/tendering,
restrictive)
.Shipment modalities
(air, sea, land etc)
.In-country storage
and distribution costs
(if applicable)
.In-country
sampling/quality
testing costs
.Customs clearance
fees
SOH, Quantity on order

29. Build the Supply Planning Assumptions
Assumptions about national and facility stock levels (stock on hand),
any quantities that have been ordered but not yet received (quantity on
order), and any products that will expire before they are used.
.

30. Estimate the Total Commodity Requirements and
Costs
The estimate of the total commodity requirements for the forecast period is
determined by:-
 Calculating the additional quantities of product needed to cover procurement lead
times and buffer stocks, and then subtracting the quantity of each product already in
stock.

31. Compare Available Budget to Total Commodity Costs
 The final decision on the quantities to procure will be determined by the amount of
budget available for procurement of products.
 Where sufficient budget is available, the final quantity to procure of each drug will be
the same as the quantity to order as a result of the quantification.
 In situations of non-full supply, where it is not possible to mobilize additional
resources to procure the full quantities of products required, the forecasted quantities
of products expected to be dispensed will need to be reduced

32. Using the results of the quantification
• Through the presentation of the quantification results to policymakers, program
managers, procurement managers, funders, and supply chain managers, the
following decisions and actions can be facilitated:
Program planning and budgeting decisions
Informing procurement actions on which products to procure, how much to procure, and
when to procure
Adjusting timing of procurements and shipment delivery schedules to ensure continuous
supply while avoiding stock outs and overstocking

33. Signs of Good Quantification
Rational use of medicines
Fewer expired commodities
Rational adjustment to budgetary constraints
Satisfied clients
Consistent availability of supplies (no stock-outs or under-stocking)
No overstocking
Easy management of stock

34. Signs of Poor Quantification
 Chronic and widespread shortages
 Surpluses of quantified health commodities
Irrational adjustment to budgetary constraints
 Suppression or distortion of demand
 Poor cost-effectiveness
 Irrational & ineffective use of medicines

35. Activity
Can you relate to any of the symptoms of poor quantification
to RDF Pharmaceuticals ?
Point out the three most important signs
What could be done to prevent the three pointed out signs of poor
quantification?

36. Forecasting Methodologies:

37. Session Objectives
At the end of this session, the participants will be able to:-
• Describe the various forecasting methods
• Describe the uses, data needs, and limitations of each forecasting
method
• Identify the appropriate method of forecasting according to the
information available
• Describe commonly used logistics terminologies

38. Types of Data for Forecasting
1. Morbidity data – estimated incidence or prevalence rates of health
conditions occurring within a defined population group
• Used to estimate the number of cases expected during the
quantification period
• Forecasting with this data typically tends to over-estimate
pharmaceutical demand

39. Cont..
2.Consumption data – Quantities used, losses and adjustments to
inventory, and the stock on hand at the various levels of the in-country
supply chain
3. Demographic or Population data - Population growth and
demographic trends
4. Service Statistics data - Number of service delivery sites, the volume
of services or number of patients per site, and the type of service
received

40. Forecasting Methods
• Consumption Based
• Morbidity Based
• Adjusted consumption
• Service-level projection

41. Consumption-based quantification
• The consumption (or Logistics) based method uses historical data on the use of health
commodities.
• Past consumption trends may be useful in forecasting Stock-out periods must be factored in
• In the consumption method, a list of all health commodities to be procured is prepared, and
the most accurate inventory records of past consumption are used to calculate the quantities
needed for each product.

42. Consumption Method: Data needs
• Reliable consumption data
• Estimation of time out of stock
• Estimations of wastage (losses caused by expiry, pilferage, damage)
• Used in established supply systems e.g. for long term therapy continuing
patients
• Records of supplier lead times
• Projected medicine costs

43. Steps in the Consumption-Based Quantification Method
Step 1: Prepare a list of health commodities to be quantified..
• Should be sorted into the order that will best facilitate data collection
Step 2. Determine the period of time to be reviewed for consumption.
• For 6 month procurement-12 month review
• 6-12 months are usually recommended
• In case of seasonality, 12 month
• 3 months reviewed reflect if only steady state of consumption for the entire year.

44. Cont..
Step 3. Enter consumption data for each commodity.
For each item on the list, enter the following:
• Quantity consumed for each
• Days out of stock
• Likely source of data;
• Stock records and distribution reports from a central distribution point
• Stock records and reports from regional or district warehouses
• Invoices from suppliers
• Dispensing records from health facilities
• If possible, collect price at this steps

45. Cont..
Step 4. Calculate the consumption of drugs required
• Stock record card: Recorded Consum. = BS + Received – End Bal- Wastage
Step 5. Adjust consumption for stock outs and compute AMC
• key variable in the quantification formula and should be as accurate as
possible.
• If stock-outs occurred during that period, the average must be adjusted to
include the consumption

46. Cont….
• There are two ways to compute AMC
• CA= C ÷(DOS/30.5)
• CA= C ÷( RM-SO in Month )
• For example, consider the entry for ampicillin 250mg capsules. The total
consumption for a 6-month review period was 89,000 capsules. The
medicine was out of stock for 34 days in the 6-month period. Therefore, the
average monthly consumption (CA) is:
CA = 89,000 ÷ [6 – (34 ÷ 30.5)] = 89,000 ÷ 4.8852 = 18,219
or
CA = 89,000 ÷ (6 – 1) = 89,000 ÷ 5 = 17,800
AMC = CA/RM

47. Cont..
Step 6. Calculate the projected AMC for expected changes in consumption pattern
CA adjusted for service change= CA + (CA x percent for SC)
Step 7. Convert into order pack
No. of order pack = quantity calculated/pack size required
Step 8. Estimate costs for each health commodity and total these. Total cost of each drug = no. of order pack x unit
price per pack
Step 9 Compare total costs with the budget and make adjustments. ( VEN/ABC)
• If the total expected procurement cost exceeds the available budget, only two choices really exist:
either
• Obtain more funds or
• Reduce the number of commodities or the particular quantities of each ordered, or both.

48. Limitations of Consumption Method
• Assumes that current and past usage patterns will continue
• Not useful for newly introduced protocols
• Relies on good inventory records
• Possible changes in the pattern of consumption (Change of prescribers,
promotional influence)
• Needs data from a system with relatively uninterrupted supply
• Can perpetuate irrational use

49. Summary
The success and accuracy of forecasting can be improved by
• Accurate consumption data is critical.
• Most recent accurate data yields highly valuable information
• Always ensure you adjust for losses, negative/positive adjustments and stock-outs
during the consumption review period
• A team approach to making assumptions and decisions
• Cross checking data, information and projected needs
• Using ongoing monitoring of projected versus actual needs to adjust assumptions

50. Morbidity based Methodology

51. Objectives
The objectives of this session are:
• To discuss the critical issues in quantification
• To describe the steps in Morbidity method of quantification process
• Merit of Morbidity method of quantification

52. Morbidity Method Morbidity based
forecasting
 Morbidity Method:- estimates the need for specific pharmaceuticals
based on the expected number of attendances, the incidence of
common diseases, and standard treatment patterns for the diseases
considered.
• This method starts from two sets of data: the number of episodes of
each health problem and average standard treatment schedules

53. Cont.…
Morbidity method is more appropriate when:
 Available consumption data are incomplete /unreliable
 Prescribing patterns are not cost effective
The health facility or services concerned are not expanding or contracting rapidly

54. Morbidity Method: Data Needs
• Population data broken down by cohorts
• Prevalence/incidence of diseases
• Current patient numbers
• Estimates on the number of patients to be tested or treated
• Program attrition rates
• STGs, testing algorithms or other protocols

55. General Highlight

56. Morbidity based forecasting steps[4]
Summary
• Preparing an Action Plan, critical step
• Hospital level quantification for increased ownership and data quality
• Computerized methods for increased efficiency
• Morbidity based quantification steps –critical issue

57. 3. Adjusted consumption method
• Uses data e.g. disease incidence, consumption and/or expenditure from
a standard supply system and extrapolates the consumption to the
target supply system
• Useful for estimating needs when rolling out services to new sites or
when starting new programs

58. Adjusted Consumption: Data needs
• Similar area or region with good consumption and population data
• Requires adequate comparability of facilities, morbidity & treatment
practices

59. Limitations of Adjusted Consumption
• Difficult to match or adjust for all variables
• e.g. prescribing practices

60. 4. Service-level projection method
• Used for estimating budget needs
• Uses the average medical supply procurement cost per attendance or bed-
days in different types of health facilities in one system to project needs for
similar types of facilities in another system
• Doesn’t directly estimate quantities of health commodities needed

61. Choosing a Forecasting Method
This is based on the availability and quality of data:
1. Rate of consumption of the pharmaceuticals used
2. Number and type of patients receiving services, treatment and
testing guidelines

62. Forecasting Accuracy
The measures are as follows:
Algebraic deviation = Forecast demand - Actual demand
Absolute deviation = |Forecast demand - Actual demand|
Absolute deviation percentage = (Absolute deviation /actual demand) * 100
Mean absolute deviation (MAD) =Sum of absolute deviation over N periods/N
Mean absolute deviation percentage (MADP) =Sum of absolute deviation percentages over
N periods/N.
EPSA KPI….Most Popular Matrix :Mean Absolute Percentage Error - MAPE

63. Mean Absolute Percentage Error - MAPE
• The mean absolute percentage error (MAPE) is the mean or average
of the absolute percentage errors of forecasts. The smaller the MAPE
the better the forecast.
n
Actual
|
Forecast
-
Actual
|
MAPE


%
100
*

64. The Realities!
Forecasts are seldom perfect
Most techniques assume an underlying stability in the system
Short-term forecasts are more accurate than long-term forecasts
 Collaborative forecasting will minimize forecast errors
Summary

65. Thank You

66. Quantification orientation of Laboratory
commodities for 2014 EFY
2013 EFY

67. Outline
12/21/2023 67
 Introduction
Points to be considered
Central Analysis

68. Introduction
68
Laboratory is a dynamic science, in which majority of resources and
finance is allocated to research and related projects
Diagnostic technologies are continuously changing
Occurrence of new emerging disease patterns
Requirement of a continuous periodic and relentless updating and revision
of tests as well as product lists

69. Introduction……
• laboratories service required large number of commodities
• Quantification system uses item prioritization based on routine utilization
and budget availability of the facilities
• Which depends on VEN systems and ABC analysis to prioritize selection,
procurement, and use according to the potential health impact of products.

70. Points to be considered for quantification
12/21/2023 70
• Types of services given
• Level of health facility
• Test menu
• Type of instruments available
• VEN category of each hub
• Previous issue data

71. Peculiarity of placement
• Obsolete (discontinuity) of the technologies
• Unmovable (underutilization) of items
• Substituted (replaceable) items
• An emergence of placement machines and reagents
C. chemistry, hematology and glucometer machines

72. Cont..
Invention of new technologies
e.g. Chromatographic technique for serology kits digital/computerized X-Ray,
MRI & CTscan machines
New emerging disease patterns e.g. Hepatitis virus, Cancer diagnostic
reagents (HPV), kidney transplant diagnostic reagents

73. Thank You

74. •Medical Device

75. Approaches to 2014EBY
Quantification

76. Content
• The Methodology For the 2014 EBY quantification exercise
• To Sampling Approach
• Quantification supporting modality
• General Assumption for the 2014 Quantification
• Data source for the quantification Exercise
• Data quality and cleaning
• Proposed team composition for Clustering

77. Methodology(Process-1)
• Technical team composed of
staffs with various technical
expertise's in the area of
medicines, laboratory reagents,
medical supplies and medical
equipment is established at
central level under the
Quantification and Market
Shaping Directorate to work on
the overall quantification process
• Smart chain(Global fund)
• Conduct an analysis on the overall
RDF quantification
• Conduct a workshop and discuss
with Experts from
stakeholders(EPSA, Implementing
partners on the current practice and
future Design
• Conduct a Health facility visit
• Come to a conclusion on the future
design
• Modeling approach

78. Process(2)
• SOP/Procedural developed and took kit
• Develop the sampling/Modelng approach
• Cluster based approach
• Revise the list of pharmaceuticals that will be
included in the forecast by considering the
agency’s procurement list, commodities that
are supplied in health program, less essential
items, strength duplications and other
considerations.
• Revise the unit price of all commodities and
verify the final price list together with Tender
Management Directorate(From Latest PO)
• Develop a quantification Tool
• Provide an Orientation for EPSA hubs and
RHBs
• Hub Activity
• Cluster will establish a cluster based team and will be
responsible for the forecasting under its catchment
• Establish a team
• Select health facilities that will be supported based
on the selection criteria and list for which sites
their result will be extrapolated-Cluster and Hub
• Provide intensive support for selected sample
health facilities at least twice-Cluster and Hub
• One Integrated with Regimen data collection
• Other onsite support
• Aggregate the forecast result of supported health
facilities as per the Quantification tool-Cluster
and Hub
• Aggregate and Analyze the forecast of hubs under
the cluster-Cluster
• Conduct a validation workshop-Cluster

79. Cluster based approach
• The central Team will oversee and support the cluster Hubs
• The cluster hubs in return will mentor and support the hubs
under them.
• A Cluster based Team will be developed at each cluster and the
cluster will be responsible for aggregating and make ready the
data under ites respective Hubs

80. Process(3)
• Centrally
• Aggregate and analyses the Cluster forecast by comparing with previous years forecast, past three years
adjusted issue data, request Vs issue and other parameters
• Prepare a validation workshop and agree with Cluster
• Generate three years forecast (2013-2015EBY)
• Use Pipeline software to analyses the current stock on hand and on pipeline and compute the annual
demand of procurement for all commodities
• Reconcile the annual demand budget with the actual budget available considering factors like foreign
currency, and discuss this with finance directorate.
• Generate procurement request for items not included in framework agreement and for locally
manufactured items
• Initiate request for PO issuance for items included in framework agreement
• Quarterly update Pipeline and do a proper pipeline monitoring
•

81. Activity Expected from Hub and center at Forecasting
Phase
During the forecasting phase, the hub based
quantification team will do the following
activities
• Make RDF quantification an agenda on
technical working groups(IMPACT
Team) and other coordination platforms
• Select health facilities that will be
supported based on the selection criteria
and list for which sites their result will
be extrapolated to.
• Disseminate the forecasting tool to
sampled health facility
• Provide intensive support for selected
sample health facilities at least twice
(one whole day to discuss on what data
sources to use and exercise on some
medicines and get back another whole
day to see the progress the facility is
doing and support on gaps). lth facilities
under catchment
• Data sources that can be used at facility
level to generate forecast can be the
following
• Bin cards , Stock cards,Dagu
facility level (if updated regularly),
Model 19 and 22,
• Case reports (HMIS, morbidity
data)
• Past year quantification report
• Daily lab registration reports
• Aggregate the forecast result of
supported health facilities as per the
Quantification tool
• Analyze the aggregated forecast and
send the final hub based forecast to
central team on the agreed timeline
• For cluster Hubs:
• Provide an intensive support for
those hubs under the clusters

82. Cont..
During the forecasting phase, the central quantification team will do the following activities
 Provide intensive support to cluster hubs
 Aggregate and analyses the hubs forecast by comparing with previous years forecast,
past three years adjusted issue data, request Vs issue and other parameters
 Prepare a validation workshop and agree with hubs on the three years forecast result
 Generate three years forecast (2013-2015EBY)

83. Activity Expected from Hub and center at Supply planning Phase
• During the supply planning phase, the hub
based quantification team will do the
following activities:
• Update and use the following data to
calculate the net requirements a part of
supply plan
• SOH with respective expiry date as
of Tir 30 2012EBY
• Expected local delivery from Tir to
Sene 30/2012
• During the supply planning phase, the central
quantification team will do the following
activities:
• Use Pipeline software to analyses the current stock
on hand and on pipeline and compute the annual
demand of procurement for all commodities
• Reconcile the annual demand budget with the actual
budget available considering factors like foreign
currency, and discuss this with finance directorate.
• Generate procurement request for items not included
in framework agreement and for locally
manufactured items
• Initiate request for PO issuance for items included in
framework agreement
• Quarterly update Pipeline and do a proper pipeline
monitoring

84. Further activities planned-2013
Quantification
• Activities that will be done by the central team after finalization of the
quantification
• A summary of the quantification report will officially be shared to each directorate
and also on the agency’s website
• ABC/VEN analysis of RDF commodities
• Delivery breakdown for locally manufactured commodities will be done
• Quarterly pipeline monitoring using Pipeline software will be done for all vital
commodities
• Adjust AMC twice a year (every 6months)
• Monthly stock status reports
• Follow up the agreement versus demand or consumption for facilities that are
included in committed demand, analyses the challenges and come up with solutions
• Look for ways that will further improve the quality of RDF quantification
• Compute forecast accuracy twice a year (every 6months)
• Give inputs to market shaping team regarding RDF commodities

85. What Is new for this year quantification?
• Cluster based quantification
• Cluster based aggregation and Analysis
• Sampling Method
• FMOH highly engaged

86. Modeling Approach-for sampling
• Sampling approach
• Modeling approach will be used by the hub to sample that health
facility that will forecast their future need. This is with an objective
of obtaining representative health facility.
• It is expected to address :
• All referral hospitals under the hub catchment area (100%)
• Health centers -Sample (10% of the total with the respective volume)
• For Functional primary hospital sampling- (15% of the total primary hospital)
• General hospital 20% of the total will be taken as representatives sample

87. Cont.….
• The above sampling should be used which accordingly will be extrapolated by
using the number of Health facility (Primary hospital, General Hospital and health
center) who summit their need.
• The extrapolations should use the same volume (level) data to extrapolate the
uncovered (None summited) health facility.
• The criteria for selecting those sampled health facility will be
• Those health facility who had a good LMIS records(Dagu site)
• Those health facility with good accessibility
• Those health facility with the same route
• If the hub serves more than one region, region representation into the selection

88. How to Extrapolate????
• The extrapolation procedure is a critical step throughout the quantification
process to consider those health facilities that may not summit their forecast
need due to some circumstances. So it is required from the Hubs to
extrapolate the need of other using the formula
Y=(𝑻𝑭𝑵/𝑻𝑯𝑭𝑺) ∗ 𝑻𝑯𝑭
Where
• Y=Extrapolated For non-submitted HFs Need
• TFN= Total Submitted Facility Need in quantity
• THFS=Total number of health center who summit their forecast need in Number
• THF=Total Number of Health facility(HV,MV,LV or PH,GH) under the Hub

89. Example: How to extrapolate?
• Example on Extrapolation: Assume that Adama Hub have a total of
280 Health facility out of which 40 are primary hospital,200 Health
centers(40 High volume,100 middle volume,50 low volume) and 35
general hospital and the reset referral Hospital and only 4 Primary
Hospital and Health center Summit their need. So based on this
information how can we Extrapolate for
• Scenrio1:Primary Hospital
• Scenario 2:High Volume

90. Cont.…
• Hub Level role at 2013EBY quantification exercise
• Continuous support to HFs
• Supportive supervision
• Phone communication
• Support through WoHOs
• Sampling based on the predefined Assumption
• Extrapolation for sites that didn’t send forecast
• Feedback for HFs and WoHOs on data quality

91. Data Source for the quantification
Data sources
Hub level Central Level
• Last year quantification result
• Centrally developed quantification tool
• Annual hub distribution data
• Expert opinion
• Bin cards
• HCMIS
• Last year quantification result
• The forecasted data sent by selected health
facilities that is aggregated and adjusted at
hubs
• Data on stock on hand (hubs + central) and
quantity on pipe line.
• Updated hub-specific AMC
• Updated national AMC
• Updated prices are retrieved from recent POs
and price index guidelines and international
price indicator.

92. Data quality Issue-
Critical Issue to
consider
 The data that is obtained/collected from the health facility should
be as reliable as possible.so it is expected from the hub to:
o Reconciling with the previous quantification exercise
o Compare and oversee the Actual issue trend
o Cross check with RDF purchase request from facility with in the redefined
period
•

93. Coordination and collaboration
EPSA Central
EPSA Hubs
FMOH/PMED
RHBs
ZHDs
WoHOs
Health Facilities
Implementing partners

94. Due date for Quantification Submission

95. General Assumption for the 2014EBY
Quantification

96. Technical
assumption
 Days out of stock should be
considered
 Consider the expiry date for
supply planning
 It is assumed that for AMC
Adjustment the review period to
be used:
 At Health center:3 Month review
period
 At Hospital:6 Month review
period

97. Sampling
assumption
 All referral Hospital 10% of all
health center
 15% of Primary Hospital
 20% of General hospital under

98. Routine medical
Device
 Health facilities should undertake a
minor inventory analysis before
quantifying their demand.
Quantification for medical device
shall indicate slight deviation from
that of drug reagents or other
medical supplies. Accordingly the
health facility should consider the
following purposes.
 Replacing the damaged device
 For service expansion that under
takes
 In accuracy and lack of precision
due to the elongated life span
 For back up purpose in time of
emergency
 For providing specialty health
service

99. Supply plan Assumption
Hub should use Stock on hand as of Tahesas 30,2013
Expected local delivery from Tahesase 30,2012- Sene 30,2013
Expiry date should be consider for SOH
Items that are locally procured and directly supplied to branches, will be
considered as stock on transit on the bases of the previous two quarter supply
performance and the remaining balance to be delivered as planned schedule

100. Other Assumption
• Health facility can use 5-15% of the total forecast if there is service expansion(Program scale up)
• For 2013 EBY Private health facility will not be considered
• The consumption pattern and price of pharmaceuticals will not be significantly changed in the
years to come
• Demand will increase as a result of the launching of Social Health Insurance & Community Health
Insurance
• Currently under construction public hospitals will begin service provision soon.
• Respective facilities will considere the no of days or months that the item was out of stock during
the review period
• The number of health facilities selected from each category is enough to represent the total number
health facilities found in the country

101. Cont.…
• Health facilities for which extrapolation is made have similar
consumption pattern to those of the respective categories of health
facilities that submitted their demand