fixing-the-weak-links-1920

Improving the supply chain

Gaps in the supply chain resulted in cost mark-ups putting modern cancer therapies out of reach for patients in sub-Saharan Africa.

Published 25 June 2019

The best medicine can be of little worth to patients if it does not reach them on time. Worse still, imagine if you have to pay every cent of your healthcare costs, and you make less than a dollar a day.

Until a few years ago this was the reality for many cancer patients in sub-Saharan Africa (SSA). In countries big and small, most of them with a pay-out-of-pocket system, costs very often put proven and modern cancer therapies out of reach. One of the primary reasons – broken or sub-optimal supply chains in these countries which led to a compounding of costs on a sustained basis. Sometimes they led to mark-ups between 40 and 700%. The impact was cruel. Physicians who knew their patients would benefit from these treatments hesitated to prescribe them.

The serious challenges resulting from a broken or poorly functioning supply chain in SSA was highlighted by a systematic evaluation carried out by Roche, that included members of its Pharma Technical Operations team in 2016-17. The study was carried out in six countries – Kenya, Ethiopia, Sudan, Côte d'Ivoire, Nigeria and Ghana. The findings were startling, but they could be fixed in incremental steps.

One of the first Roche affiliates in the region that stepped into action was Nigeria. The results are beginning to show. While some remedies have been simple adjustments bearing quick and immediate results, others have needed a more fundamental structural change in the way business was done and relationships maintained with partners on the ground.

Says Ladi Hameed, Country Manager, Roche Products Nigeria: “Looking back three to four years, one of the main problems we faced was having multiple levels of distribution. In Nigeria we would go from a main distributor to a sub-distributor to several sub-distributors before finally getting to the end user in the hospital, or the patient.”

Three bitter pills

A lab assistant from Lakeshore Cancer Center in Lagos is sitting in front of a fume cupboard and opening a bag with drugs to start reconstitution process.
Pharmacist reconstituting a drug at the Lakeshore Cancer Center in Lagos, Nigeria.

He adds, “Every person in each stage of this complex distribution chain would add mark-ups of 5-10% on the cost of these medicines. Secondly, there would be concern about the quality of the products because very often their cold chain would be a weak link. And then there was a third major problem which came about because the importation of drugs was not done directly by us. It was done by the distributor on our behalf and they kept pushing up costs stating the forex versus local currency argument. That meant that we had no control. Any currency fluctuation would immediately be transferred to the patient who was paying out-of-pocket. At one stage they were paying a difference of between $200 and $500, month on month, for well-known breast cancer and blood cancer medicines.”

A very basic health insurance system – National Health Insurance Scheme (NHIS) - mainly oriented towards infectious diseases did not help much. Even if they got started, at some point the patient would just give up and stop the treatment. In other cases, the doctors hesitated to even prescribe these medicines.

Doctors’ dilemma

Talking about these upheavals, Dr Ella Nwachukwu of the National Hospital Abuja points out, “I am always eager to inform patients about modern treatment options that would be beneficial to them. But prescribing these drugs can be challenging as a majority of my patients cannot afford to procure them. This inability to afford the best treatment put a lot of pressure on my decision making as I had to then recommend therapy which was not necessarily the best option because of financial constraints.”

She continues: “Prior to their availability in the hospital pharmacy, patients had to procure these medicines from sources that could change or increase the prices of these medicines. I often heard my patients say, ‘I can’t afford this treatment. Is it covered by the NHIS? What are my options if I cannot afford this drug?’ I was also worried about the preservation and transportation of the drugs.”

Expert speak

Prashant Yadav, Strategy Leader- Supply Chain at the Bill & Melinda Gates Foundation, and a Lecturer at Harvard Medical School believes that such fundamental flaws in structure of the supply chain have deep social and economic consequences. He highlights: “When the supply chain serving patients who seek treatment in government run clinics and hospitals is ineffective, it reduces the patient’s confidence in the formal health system. It leads to loss of follow-up, lack of care continuity, delays in seeking early treatment at the next episode of an illness, and going to alternative forms of medicine.”

Mr. Yadav is of the opinion that, “Often when government hospitals and clinics are out of stock of medicines, patients go to private retail pharmacies and drug shops to obtain the prescribed medicines. High mark-ups along the channel, which typically consists of an importer – wholesaler – retailer, are sometimes even as high as 100% of the ex-manufacturer price. This implies that patients have to pay a high price for medicines. In addition, the quality of medicines they obtain may be uncertain.”

Two airport workers are standing in front of a closed garage at cargo terminal, Lagos airport. A sign indicates this is an AC room, where medicine is stored.
An AC room at the cargo terminal at Lagos Airport.

Nigeria – working on solutions

Following the findings of the Roche study a couple of years ago it was evident that some things had to change in order to benefit the patient. “One of the major things that we undertook in Nigeria with help from Roche headquarters was to change the business model,” says Ladi. “Roche Products Nigeria went from being a pure marketing services company to a buy-and-sell operation, by which we could bring in the medicines ourselves. We took on the risk of forex fluctuations upon ourselves. Importantly, we could directly supply the crucial medicines to the hospital pharmacies without constantly impacting the prices. With this step we removed several layers of mark-ups and that brought an almost 50% reduction in the price of some of medicines to the patient immediately.”

A hospital employee is sitting at a desk in an office room. She does calculations on checking her paper for the medicine stock at Lakeshore Cancer Center in Lagos.
Pharmacist completing documentation work on medicine stocks at Lakeshore Cancer Center in Lagos.

That having been achieved, the local Roche affiliate in Lagos was empowered to go to the federal government, and then to state governments, to begin discussions on reimbursement and how to make sure patients were receiving the therapies that their doctors thought were the best for them. For instance, Roche could now approach state governments in Nigeria about paying for breast cancer treatments for their local population, and it worked. To start with, they agreed to pay for 20 patients over five years. Roche could also start discussions with the federal government about creating a fund for critical illness of which cancer was one. This would never have been possible before with the earlier prices. The number of patients who could access Roche’s modern medicines went up from 105 in 2016 to 232 in 2017 and then reached 431 in 2018.

Added responsibilities

It wasn’t however, all a given and easy to do. There was a host of added responsibilities. Because Roche was now involved in directly supplying medicines to the institutions in Nigeria, it had to work with them to ensure that the quality of medicines was maintained, even after they had reached the hospital pharmacy. This involved training of staff in supply chain management. In some instances, it needed the team to provide hospitals with solar panel powered refrigerators so they could stock these drugs for sufficient number of patients to protect against the frequent loss of power in Nigeria. The local quality team responsible then helped the hospital staff to develop a SOP that they could implement to assure quality standards.

This was a hugely beneficial exercise to the whole Nigerian healthcare environment as the systems that Roche Nigeria put into place was not restricted to Roche products alone. They were adapted for the supply chain in general and warehouses stocking products of other companies as well.

Tags: Society, Patients, Access to healthcare