National supply chain

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National supply chain logistics solutions for
vaccines Thoughts from Optimize

• Patrick Lydon (WHO)

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Current Supply Chain
Airport
National
Primary Store (National Level)
Sub-national 1
Sub-national 2
Sub-national 3
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Current Challenges
Review of Vaccine Management Assessment tools
(VMA) 18 National stores 152 Sub-national
stores 223 Health centers Enduring problems
Warehousing Distribution Temperature Stock
control Wastage Problems amplify and ripple
down the chain
Source Andrew Garnett (Optimize consultant)
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Current Challenges

• Push system requires
• Good forecasts based on accurate data and
  information
• Vaccines to be stored at many levels of the
  system
• Infrastructure and buffer stocks at each level to
  anticipate demand fluctuations
• The problem
• Often at some point in the chain, poor data
  compromises good forecasts
• Each store and transport link is a risk point and
  bottleneck
• Collection system at lower levels is weak
• Consequence
• Vaccines often don't end up where they are
  suppose to in the right quantities, at the right
  time and in the right conditions
• Children may not get immunized (stock outs,
  delays in delivery...) or immunized with damaged
  vaccines (temperature exposures, too many storage
  points and mishandling...)
• Wasted financial resources (overstocking at lower
  levels high vaccine expiry...)

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Future Challenges ?

• More expensive new vaccines
• And more to come
• Bulkier presentations
• More complexity in vaccine management

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At the Crossroads

• Has the simplicity of a logistic system developed
  in the 80's reached it's limits today?
• How to address some of the enduring problems of
  the vaccine supply chain?
• How to anticipate the future challenges and
  complexities?
• How to promote long term solutions to address
  these?
• And how to think beyond immunization for
  solutions?
• Optimize undertook a review of the experience in
  the health sector and outside of health

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Future Supply Chain?
Airport
National
Primary Store (National Level)
Sub-national 1
Where is the boundary?
Sub-national 2
Sub-national 3
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Ideal Attributes

• Demand-driven from national and service delivery
  levels
• Distribution-based rather than collection at
  sub-national level
• Optimal number of steps increased speed
• Ability to move great volumes
• Minimized risks to the vaccines
• Traceable
• Integrated with the supply of other health
  commodities
• Good management
• Sustainable
• Increased access to target populations

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Possible Solutions

• Optimizing the current system
• Invest in more equipment
• Increase transport frequency
• Integrated with other health commodities
• Explore system alternatives
• Inter-country warehousing of vaccines
• More direct distribution down the supply chain
• Moving warehouses
• Outsourcing supply chain and logistics functions
• No one size fits all !
• Menu of options
• Solutions likely to be a mix

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Main Outcomes to be Expected

• Vaccines ending up where they are suppose to in
  the right quantities, at the right time, and in
  the right conditions
• Higher coverage from reduced stock outs, delays
  in delivery, and increased supervision
• Lower burden of disease from children immunized
  with potent vaccines
• Mitigate some of the cold chain capacity issues
• Lower costs from reduced overstocking, vaccine
  expiry, too many steps in the chain that increase
  costs

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Inter-Country Warehousing

• Consolidate larger inventories of vaccines and
  supplies in a single warehouse closer to a
  catchment area of many countries
• Advantages
• Accommodate for the procurement needs of several
  countries
• Use of larger cold chain shipping units to reduce
  bulk and costs
• Reduce the need to expand national cold chain
  capacity
• Limits the need to store as much buffer stocks at
  all levels
• Allows for secondary packing and bundling
• Shorter transits to countries
• Pay as you go system

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Inter-Country Warehousing

• Ex 1 USAID / SCMS Project
• For HIV-AIDS related commodities
• 3 regional warehouses (RSA, GHA, KEN)
• Managed by private sector "Fuel Logistics"
• Shorter delivery time (4 months to 6 weeks)
• Economies of scale (cost savings)
• More flexible to high variance of demand
• Ex 2 Regional Vaccine Cold Store facility in
  Fiji
• Vaccines are then be repackaged and distributed
  to 12 Pacific Island States

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Streamlining Solutions
Regional Warehousing
Or

• More direct distribution
• Directly from the national (primary) store to
  district stores
• Directly from port of entry to intermediate
  stores or lower (thru cross-docking)
• The idea is to by-pass bottleneck levels of the
  chain
• Distribution system at sub-national
• Potential for delivery trips to be combined with
  maintenance, supervision and data collection
• Compatible with new information and refrigeration
  technologies

Virtual Primary Store
Health Centres
Health Centres
Service Delivery
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Compatible Technologies

• Cooling technologies
• Passive cooling containers (rolling dollies)
• Solar PV battery-free refrigerators
• Hybrid battery free cooler
• Information technologies
• RFID, bar coding
• Mobile phones
• PDA's

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Ex Thailand's Current System

• Problems
• Poor information systems and forecasting
• Inadequate quantities being supplied
• Frequent delays in deliveries
• High wastage due to expiry
• MoH refrigerated trucks too old and expensive to
  maintain
• Health workers not skilled enough to manage the
  cold chain

Today
Port of Entry
Primary Store (MoH)
Hospitals
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Ex Thailand's Solution - 2009
Today
The Future

• Why?
• Private logistics company already doing this for
  HIV-AIDS drugs
• Hospitals manage drugs and have computerized
  system direct to national level and
• They operate a distribution rather than
  collection system that works

Port of Entry
Port of Entry
Primary Store (Parastatal)
Primary Store (MoH)
Outsourced storage and distribution to private 3
PL
Hospitals
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Outsourcing

• System solutions rely on outsourcing services
• The MoH of many countries already outsource
  discreet supply chain and logistics functions
• Rationale
• Managerial efficiency gains from MoH management
  of logistics
• Reduction in capital investments at the expense
  of increased recurrent costs of outsourcing
  services
• Wastage is reduced because resources are used
  more efficiently
• Or cost increases are offset by improvement in
  efficiency and quality
• Two categories
• Contractor manages part of the system as a
  service to the MoH
• Contractor leases materials or equipment to the
  MoH

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Outsourcing Options
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Outsourcing Models
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Menu of Solutions for the Future
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Thank You

• Patrick Lydon
• lydonp_at_who.int