MINISTRY OF HEALTH
REPORT ON
Updating of the Three Year Rolling Procurement Plan for Essential Medicines and Health Supplies2009/10 -2011/12
Including Evaluation of 2008/2009
PHARMACY DIVISION
March 2010
Table of Contents
Acknowledgement
Acronyms
1.1Uganda Situation
1.2Background to the procurement plan
1.3Objectives of the procurement plan consultancy
1.4Methods
2.1Evaluation of EMHS Procurements in the FY 2008/2009
2.2 Procurement plan 2009/10
2.2.1 Funding by Product category
2.2.2Main funders and funding modalities
2.2.3Supply chain management
2.2.4Funding Gap
2.3Evaluation of the Med Planner software
3.1 Observations
3.1Predictability of funding for EMHS
3.2Lack of flexibility in resource allocation
3.3Efficiency and effectiveness of the Supply chain systems
3.4Resource allocation to service providers
3.5Data on commitments for EMHS
3.6 Monitoring and Evaluation
3.2Recommendations
Annexes 1: Data collection team
ANNEX 2: Data Collection tool
ANNEX 3: The Procurement Plan 2009/10 and 2010/11
Acknowledgement
On behalf of the Ministry of Health and Pharmacy Division allow me to extend my sincere appreciation to all those who worked tirelessly to ensure the publication of this report.
First and foremost I would like to thank Medicines Transparency Alliance (MeTA) for funding this activity and the MeTA council for their patience as project moved at its own pace.
Secondly I would like to acknowledge the pharmacy team division team of Morries Seru, Thomas Obua, Gideon Kisuule and Frans Bosman for data collection, analysis and review. I wish also to acknowledge Khalid Mohammed formerly a consultant in the Division for his input.
Last I would like to thank all the organizations involved in funding, procurement, storage and distribution of essential medicines for their cooperation and providing the information that enabled to carry out the exercise. I would like to single out the following, MOH programmes (UNEPI, TBLP, NMCP, ACP, RH, CPHL,HSPS III,), NMS, JMS, UNICEF, USAID, CDC, MAUL, UNFPA and CHAI)
Martin Oteba
Assistant Commissioner Health Services
Ministry of Health
Acronyms
ART / Anti Retroviral TherapyARV / Anti Retroviral
CHAI / Clinton HIV AIDS Initiative
DANIDA / Danish International Development Agency
EMHS / Essential Medicines and Health Supplies
GF AGENT / Global Fund Agent
GFATM / Global Fund for Aids, Tuberculosis and Malaria
DFID / Department for International Development
GAVI / Global Alliance Vaccine Initiative
PMI / Presidential Malaria Initiative
GOU / Government of Uganda
JMS / Joint Medical Stores
MEDACC / Medical access
MeTA / Medicines Transparency Alliance
MOH PROG / Ministry of Health programmes
NMS / National Medical Stores
PEPFAR / Presidents Emergency Funds For Aids Relief
SCMS / Supply Chain Management Systems
UBTS / Blood Transfusion services
UNFPA / United Nations Fund For Population Activities
WHO / World Health Organisation
CHAPTER 1 INTRODUCTION
1.1Uganda Situation
1.1.1Geography and Population
Uganda is located in East Africa with an area of 240,038 km2 of which 197,323 km2 is covered by land. In 2002 the population of Uganda was estimated at 24.2 million: 48.5% were male while 51.5% were female; and 86% are resident in rural areas. . The population growth rate is estimated at 3.3% per annum which means an increment of more than 1 million people annually. The Uganda Bureau of Statistics (UBOS) estimates the population in 2009 at 30.7 million and by 2014/15 Uganda’s population will be approximately 37.9 million. This rapid growth in population has serious implication for the health sector in general and access to pharmaceutical services in particular.
1.1.2Pharmaceutical Sector
Like the general health sector the pharmaceutical sector in Uganda is can be subdivided into three main segments, the public sector, Private Not for Profit (PNFP) and the Private for Profit (PFP). While the sectors may have distinct characteristics in reality they are so much interrelated all support one another in way or the other. Pharmaceutical sector activities can be categorized as importation/manufacture, Wholesale/distribution, and retail/dispensing
1.1.3Import / Manufacture of Medicines
The Uganda Pharmaceutical Manufacturers Association (UPMA) estimates that 85% of the pharmaceutical use in Uganda is imported. All importers are licensed by National Drug Authority (NDA) and only bring in medicines from registered manufacturers. The remaining 15% of the medicines used in the country in manufactured locally by the 15 licensed small and large scale manufacturers[1]. One of the largest importers is National Medical Stores (NMS) and Joint Medical Store (JMS) who import on behalf of GOU facilities’ and PNFP facilities respectively. NMS and JMS also procure medicines and supplies from other importers. Figure 1 shows the relationship between different players in the sector
1.1.4Wholesale/ distribution
In the majority of cases importers of medicines and health supplies also act as wholesalers and sell in bulk to other wholesalers or retailers. 80% of the wholesalers are located in Kampala, the capital city with the remaining 20% located in major towns in the country. NMS distribute to government facilities through intermediate transit stores in the districts and JMS operates a cash and carry system and supplies mainly PNFP facilities.
1.1.5Retail and dispensing
All government and PNFP facilities offer comprehensive services which include supply of medicines to the patients. At the PNFP facilities services are offered at a fee, while governenment facilities offer the services free of charge. Outside government and PNFP sector is a booming private for profit sector estimated to provide between 6 and 10% of health services[2]. In addition to clinics and private hospitals which mimic the government units in regards to comprehensive nature of services, there are private drug shops and pharmacies that primarily sell drugs to patients.
1.1.6.Financing of health
At the start of the implementation of second Health Sector Strategic Plan (HSSP II) 2005/06-2009/10 it was estimated that about21.2 US$per capita was required to provide the Uganda Minimum Health care Package (UMHCP). The long term expenditure framework indicated that only about 12 US$ per capita would be available leaving a gap of 9.2 US$ per capita. In 2007 the National health account reported that 50% of funding for health is met by household through out of pocket funding and about 40% of this is used in procurement of pharmaceuticals.
1.2Background to the procurement plan
Essential medicines and health supplies constitute one of the major inputs in the provision of services. Starting in 2002 financing for Uganda Health commodities has grown significantly particularly with the advent of Global Initiatives like Presidents Emergency Fund for AIDS relief (PEPFAR) and Global fund for AIDS, Tuberculosis and Malaria (GFATM). At the same time other bilateral donors like DANIDA increased the budget for EMHS. By mid 2005 it was evident that increased resources without better planning resulted in poor management of resources, leading to problems such as stock outs that called for expensive emergency procurements. Furthermore, the multiplicity of funders and procurement modalities required coordination to minimize potential for wastage as a result of duplication. With these developments the Joint Review Mission of 2005 undertook to support the development of three year rolling procurement plans. ThePharmacy Division in the Ministry of Health was tasked to spearhead this initiative and with collaboration from partners through the Technical Working group on Medicines Procurement and Management the first plan covering the period2006/07 to 2008/09 was published.With World Health Organizations (WHO) support the 2006/07 plan was evaluated after the FY ended with evaluation details published in the Annual Health Sector Performance Report 2006/2007. The WHO support also enabled the Pharmacy Division to develop software called Med Planner which supports the development and evaluation of procurement plans and makes them readily accessible to any authorised user for updating and consulting purposes.
With experience from the work on the first two rolling plans it became clear that timely compilation of the procurement plan requires dedicated personnel to collect, analyze and triangulate the data. It was therefore timely when the Medicines Transparency Alliance (MeTA)[3] agreed to support a consultancy to take forward the process that had stalled for some time.
1.3Objectives of the procurement plan consultancy
The objectives of the consultancy were to:
- To evaluate the procurements in the year- 2008/09
- To update the Rolling procurement plan for medicines and related health commodities for the period 2009/10 to 2011/12
- To evaluated progress towards integration and harmonization of procurement activities
- To evaluate the functionality of Med Planner Soft ware
1.4Methods
- Data on 2008/2009 procurements and commitments by funders for 2009/2010 was collected using the data collection tool attached (Annex1). The same tool was given to MOH programs and supply chain organizations involved procurement storage and distribution of EMHS (Annex 2)
- Desk review of available literature was carried out in orders to document the context of the EMHS procurement plan
- Discussions with key stakeholders at a workshop to map way forward on integration and harmonization
- Data input and report generation from the Med Planner to identify the strength and weakness of the system
CHAPTER 2 RESULTS
2.1Evaluation of EMHS Procurements intheFY 2008/2009
In this section the procurements made in the FY 2008/09 are described in relation to projections made in 2007/2008. In the analysisEssential Medicines and Health Supplies (EMHS) is disaggregated into major categories of (EMHS). The categories include Vaccines and related supplies, Contraceptives, Condoms, Credit line supplies and Non Credit line supplies, Laboratory credit line items, Essential medical Equipments, ACTs, ARVs, TB and leprosy medicines. Table 1 is a summary of the procurements that were made in 2008/09 for different categories of products. Table 2 provides more details regarding the source of these items.
Table 1: Procurements of EMHS in FY 2008/2009 in comparison to Projections made in 2007/2008[4] and Commitments for 2009/2010-Figures are Millions of US dollars.
Category / Actual 2008/2009 / Projections made in 2007 / Commitments 2009/2010ARV / 45.4 / 35.2 / 60.0
Credit line and non credit line medicines / 22.3 / 32.7 / 47.0
Vaccines and supplies / 16.9 / 29.4 / 21.1
Antimalarial (ACT ) / 15.5 / 0.0 / 55.3
HIV test Kits / 6.2 / 9.5 / See lab below
Contraceptives / 5.0 / 3.2 / 10.0
Credit line laboratory products / 4.2 / 3.4 / 18.6*
TB medicines / 2.3 / 0.0 / 1.7
Condoms male / 1.7 / 1.1 / 6.0
Insecticide treated Nets / 0.3 / 0.0 / 37.2
Condoms female / 0.1 / 0.1 / 0.03
Equipment credit line / 0.0 / 1.5 / 1.9
Total / 119.9 / 116.1 / 258.83
*The Lab figures for 2010 is sum of all lab items including HIV test kits
Vaccines and related supplies
A total of 16.9 million US$ worth of vaccines and related supplies was received in the FY 2008/09. Projections made in 2007/2008 had put the estimate at 29.4 million US$ as what would be required to meet vaccine needs. This was a big increase in value of vaccines due to planned increase in use of the DPT Hep B Hib Pentavalent vaccine. It was estimated that its use would increase from about 200,000 doses in 2007/2008 to 4.2 million doses at a cost of whopping 14.88 million US$. The plan was that GOU would share the cost with GAVI. Overall GOU released 4.9 million US$ and GAVI 12 million US$ in the FY 2008/2009 making a total of 16.9 million US$. For the FY 2009/2010 US$ 21.1 million US$
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Table 2: Value of procurements for the FY 2008/09 showing product category and funders(Figures in millions of US$)
PRODUCT CATEGORY / UNITAID/CHAI / DFID / GAVI GOU / GF / GOU / GOU/GF / PEPFAR / PMI / UNFPA / UNICEF / USAID / GOU/ DANIDA / GOU / PHARMA IND / GRAND TOTAL1 / Antiretrovirals (ARVs) / 13.3 / 4.2 / 19.4 / 0.3 / 8.2 / 45.4
2 / Credit line and non credit line / 0.3 / 7.2 / 11.7 / 3.1 / 22.3
3 / Vaccines and supplies / 12.0 / 4.9 / 16.9
4 / Antimalarials ACT / 0.1 / 14.5 / 0.9 / 15.5
5 / HIV rapid test kits / 4.8 / 1.4 / 6.2
6 / Contraceptives / 0.2 / 0.6 / 4.2 / 5.0
7 / Laboratory credit line / 4.2 / 4.2
8 / Anti-TB medicines / 2.3 / 2.3
9 / Condoms male / 1.1 / 0.6 / 1.7
10 / Re-treatment chemicals for Nets / 0.3 / 0.3
11 / Condoms female / 0.1 / 0.1
12 / Ess medical equipment credit line / -
Grand Total / 13.3 / 0.3 / 12.0 / 18.7 / 5.1 / 2.3 / 28.8 / 0.9 / 1.8 / 1.7 / 4.8 / 7.2 / 19.9 / 3.1 / 119.9
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Contraceptives
Funds for procurement of contraceptives have mainly come through two sources: USAID and UNFPA. Commodities worth 5.5 million US$ were delivered into the country. USAID bought the largest proportion worth 4.2 million US$. Storage and distribution of contraceptives ismainly through NMS for the public sector. A larger proportion of contraceptives is procured and branded for distribution through the private sector outlets at subsidized prices. The marketing and distribution is managed by social marketing organizations like UHMG and PACE. GOU released 0.2 million US$ from programme 9 budget for procurement of contraceptives out 1.2 million US$ allocated. This was mainly for Misoprostol, Medroxyprogesterone and Emergency “Morning after” pills. UNFPA brought in contraceptives worth 0.6 million US$. The total procured exceeds projection of US$3.4 million . Commitments for 2009/10 are even higher at 10 million US$
Condoms
UNFPA brought in 45 million unbranded male condoms in the FY 2008/09. This was worth 1.15 Million US$. USAID bought 600,000 US$ worth of condoms giving a total of 1.75 Million US$ in the review period. Projections for male condoms were for 2007/2008 was only 1.1 million far less than the quantification figure of US$3 million (MOH Quantification report 2009). It would appear that at the time of projections it was already clear that GFATM who had previously funded procurement of condoms would not release more funds until the problems with project implementation were resolved.[5] The reduction in funding for condoms also affected the social marketing sector and to date funding to support to support the popular brand of male condoms Life Guard has been intermittent.
There was a plan to re-launch female condoms and UNFPA procured 100.000 US$ worth of it.
Essential Medicines and health supplies
According to the health sector performance report total funding for procurement of essential medicines through the credit line the FY 2008/2009 was US$ 7.03 million. GOU of Uganda and DANIDA contributed 3.23 million US$ and 3.8 million US$ respectively to the essential drugs account through which the credit line funds are managed.
In addition to credit line to the GOU also gave grants worth 11.7 million US$ for districts and municipalities for procurement of EMHS. Mulago and Butabika were given 5million and 0.5 million US$ respectively. A number of donations were also realized including the Cotrimoxazole used in prophylaxis for HIV positive patients (0.3mill US$ by PEPFAR) and Praziquantel and albendazole donations by pharmaceutical industry to the vector control programme estimated at 3 million US$. Pfizer has also continued to donate Diflucan estimated at 100,000 US$
Laboratory Credit line and HIV test kits
The creation of a laboratory credit line system-with support from PEPFAR through CDC- at NMS and JMS was a strong indication that funding for lab consumables and testing kits was going to stabilize and hence projections of 3.44 and 9 5 million dollars were made for the lab consumables and HIV test kits respectively. Analysis of what was procured show that CDC brought in lab items worth 4.22 million US$. Addition lab chemicals and consumables worth about 1 million dollars were bought by CHAI and distributed to its implementing partners
A total of 6.42 million US$ worth of HIV test kits came into the country in the year under review. The largest proportion was funded by CDC at a cost of 4.79 million US$. UNICEF bought quantities worth 1.41 million US$ and CHAI made a contribution of 220,000 US$ for procurement of HIV test kits. The total was less than the projections which included procurements by GFATM that did not come to fruition for reasons explained earlier
Essential Medical Equipments
GOU and partners established a credit line system 2007 for procurement and distribution of basic and essential equipment for Primary Health Care. GOU, DANIDA and UNFPA did commit to provide funds for a number of years in order to jumpstart the scheme. The Essential Medical EquipmentAccount (EMEA) was created and by July 2007 the account was holding about 1.55 million dollars (DANIDA 1 million US$, GOU, 250,000 US$ and UNFPA 305,000 US$). An additional amount of about 500,000 US$ was added to the account in 2008. The first attempt to utilize the funds was through developing a MOU with JMS to manage the procurement and distribution. Almost immediately the plan met with resistance and the back and forth discussions led to delays. Subsequently, the procurement department of MOH floated a tender in two lots and the first lot of smaller equipment worth 583,558 US$ was awarded to a company called Intercross who completed delivery late in 2009. The second lot of bigger equipment worth 1.24 million US$ was after long discussions awarded to UNICEF who started delivery in February 2010. The essential equipment credit line illustrates how availability of funds do not necessarily translate into availability of commodities in the period planned.
Artemesinin Based Combination therapies (ACT)
Following the suspension of Global fund and subsequent prolonged negotiation projections of funding for ACTs were far from optimistic. GOU stepped in and put and committed to release 15 million US$ for procurement of ACT in 2008/09. The products were single sourced from Quality Chemicals Industries Limited (QCIL) a local pharmaceutical manufacturer. In total about 14.5 million US$[6] worth of ACT was supplied. Smaller quantities also came in through the PMI worth 900.000 US$ and a donation from the People’s Republic of china of ARCO and DUOCOTEXINE brands valued at 1 million US$.
TB medicines
A total of 2.3 million US$ was procured into the country. The projections earlier were pessimistic as protracted discussions continued with GF who were the main funders in the previous years. GF procured 1.68 million US$ worth of TB drugs through the GDF in the period of review. Stop TB also brought in drugs to the tune of 320,000 US$. In the same period GOU bought drugs 220,000 US$.
2.2Procurement plan 2009/10
This section covers the procurement plan for the FY 2009/10. The Full three year plan is shown in the annex 3 but it is important to note that many organizations have only been able to provide figures for the first year of the plan. Table 3, 4 and 5 is a summary of the of plan for the year 2009/10. This is followed by a discussion of the funding sources and modalities of flow of funds as well as the supply chain management systems used to manage the different categories of health commodities.
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Table 3: PRODUCT CATEGORYAND PLANNED PROCUREMENTS BY FUNDER FOR THE FY 2009/10. FIGURES ARE IN MILLIONS OF US DOLLARS
PRODUCT CATEGORY / UNFPA / USAID / DANIDA / GAVI / GFATM / GOU / MULTIPLE / PEPFAR / PHARMA / PMI / UNTAID / GRAND TOTAL1 / Antiretrovirals (ARVs) / 10.4 / 15.0 / 24.5 / 10.1 / 60.0
2 / Antimalarials ACT / 40.3 / 15.0 / 55.3
3 / Credit line and non Credit line Medicines / 3.4 / 1.3 / 22.6 / 15.6 / 0.8 / 3.1 / 0.3 / 47.0
4 / Insecticide treated materials / 37.2 / 1.5 / 38.7
5 / Vaccines and related supplies / 14.6 / 6.6 / 21.1
6 / Lab Equipment consumables and reagents / 8.5 / 8.3 / 1.9 / 18.6
7 / Contraceptives / 2.0 / 7.3 / 0.8 / 10.0
8 / Condoms male / 1.1 / 0.3 / 4.6 / 6.0
9 / Medical Equipment / 0.2 / 1.2 / 0.5 / 1.9
10 / TB medicines / 1.7 / 1.7
11 / Blood Transfusion Items / 0.5 / 0.5
12 / Condoms female / 0.0 / 0.0
Grand Total / 3.4 / 7.5 / 4.6 / 14.6 / 103.9 / 60.9 / 15.6 / 33.5 / 3.1 / 1.5 / 12.3 / 260.8
TABLE 4: PRODUCT CATEGORYAND THE MODALITIES FOR THE FLOW OF THE FUNDS FOR ESSENTIAL MEDICINES AND HEALTH SUPPLIES FOR THE FY 2009/10 (FIGURES IN MILLIONS OF US$)