Transcript File - 6th Global Health Supply chain summit

The 5th Global Health Supply Chain Summit
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Understanding Distribution of Medicines to
Private Sector Drug Shops and Pharmacies
Prashant Yadav
[SPEAKERS NAMES]
[DATE]
November 18 -20, 2013
Addis Ababa, Ethiopia
Understanding Distribution of Medicines to
Private Sector Drug Shops and Pharmacies
Prashant Yadav, Jessica Cohen, Jean
Arkedis, Sarah Alphs, Pete Larson, Julius
Massaga, Oliver Sabot
Tanzania: Understanding Remote Distribution
N = 356 accredited drug shops
Inventory and stock audits every
other month for 12 months
3
How do the drug shops obtain their medicines?
100%
90%
Remote
80%
Overall
Urban
70%
60%
50%
40%
30%
20%
10%
0%
Someone from the shop Place order by phone, and Place order by phone,
goes to visit the supplier to
supplier delivers the supplier sends it to another
purchase directly.
product directly to the
location in town and
shop.
someone from the shop
picks it up.
Other (specify)
4
Where do the drug shops obtain their medicines?
45%
Remote Shops
40%
Urban Shops
35%
30%
25%
20%
15%
10%
5%
0%
own
town/village
Lindi town
Mtwara town Masasi town Dar Es Salaam Sumbawanga
another
location
5
6
7
Road, trade networks and product availability
Joint work with Pete Larson
8
Understanding product diffusion in remote areas
Source: Yadav P, J. L Cohen, S. Alphs, J. Arkedis, P. L Larson, J. Massaga and O. Sabot. Trends in
availability and prices of subsidized ACT over the first year of the AMFm: evidence from remote regions
of Tanzania, Malaria Journal 2012, 11:299
9
Understanding product diffusion in remote areas
Source: P.S. Larson, P. Yadav, J. L Cohen, S. Alphs, J. Arkedis, J. Massaga Stocking Patterns, Market
Competition, and Customer Demand of Subsidized ACTs in Private Drug Shops in Tanzania. 2012
Traditional measures of competition do not help understand stocking
behavior
Mtwara
Rukwa
No ACT
ACT
p
No ACT
ACT
P
Population within 5 km (1000s)
11.61
13.5
0.6
5.62
5.8
0.23
Number of shops within 1 km
2.48
3.12
0.6
3.61
4.3
0.17
Number of shops which stocked
ACTs within 1 km
1.68
2.57
0.2
1.98
2.5
0.04
Average distance to the nearest
3 shops
5.89
5.43
0.7
6.02
3.4
0.01
Traditional measures of competition do not help understand stocking behavior
Source: P.S. Larson, P. Yadav, J. L Cohen, S. Alphs, J. Arkedis, J. Massaga Stocking Patterns, Market Competition, and
Customer Demand of Subsidized ACTs in Private Drug Shops in Tanzania. 2012
11
New models for understanding retail competition in a network
Competition/Wholesaler Network. Colors represent city of supplier, size represents degree of centrality
(number of connections each shop has with other shops through perceived competition)
Source: P.S. Larson, P. Yadav, J. L Cohen, S. Alphs, J. Arkedis, J. Massaga Stocking Patterns, Market
Competition, and Customer Demand of Subsidized ACTs in Private Drug Shops in Tanzania. 2012
12
New models for understanding retail competition in a network
Source: P.S. Larson, P. Yadav, J. L Cohen, S. Alphs, J. Arkedis, J. Massaga Stocking Patterns, Market
Competition, and Customer Demand of Subsidized ACTs in Private Drug Shops in Tanzania. 2012
13
Other issues impacting private sector medicine
availability and price
Understanding retail competition (or lack of)
Source:
Joint study with CHAI and UNZA in Zambia
15
Retail competition impacts retail markups and thus sales volume
Price charged for a full course of antimalarial in
Zambian Kwacha
12,000
10,000
P value = 0.0854
8,000
6,000
4,000
2,000
-
1
2
3
4
5
6
Competition Index= # of sources for anti-malarials in 1 km radius
Study of over 100 outlets in 4 districts in Zambia
Stocking your product in a wider number of retail outlets helps reduce retail
markups
16
Incentivizing distributors to distribute to underserved markets
Manufacturer
Importer/
Distributor
Many new models such as
• Consolidated drop-off point,
• Van sales,
• Coca-Cola like MDC
allow wholesaler distribution to small
shop clusters at reasonable costs
• Demand aggregation with technology
Wholesaler
Wholesaler distributes
Wholesaler distributes
Sub -Wholesaler
(URBAN)
(RURAL)
Retail
Retail
Access to capital constraints at the retail
level
P. Yadav, L. Smith & S. Alphs 2012. Enhancing Access to Medicines through Innovations in
Working Capital Financing for Drug Shops. Technical report for SDSI, MSH
18
Lack of working capital in the overall system
Manufacturer
30-45 Days Letter of
Credit
Importer/
Distributor
Wholesaler
Delivery - 30 Days Credit
• Higher Working Capital Needs
• Lower Product Availability
• Higher Prices
• Lower Sustainability
Cash &Carry / Cash Van
Sales
Sub -Wholesaler
(URBAN)
(RURAL)
Retail
Retail