Friday, March 7, 2014

Medicine Donations: Matching Demand with Supply in Broken Supply Chains

KOTSI Telesilla, VAN WASSENHOVE Luk, HENSEN Michael
Read the working paper
INSEAD Working Paper 2014/19/TOM/ISIC

The continuing economic downturn, which impacts health systems around the globe, will lead to more requests for medicine donations in the future. This discussion paper analyses the context in which cross-sector partners (pharmaceutical manufacturers, non-governmental organizations (NGOs), and local health institutions) can work together to give beneficiaries access to medicines donated by manufacturers in emergencies and non-emergencies. These cross-sector partners need to be aware of all stakeholders and ethical dilemmas that a medicine donation may pose. In an effort to address medicine donations under a holistic approach for the first time, we identify four factors that hinder supply chain performance: problematic assessment of demand, opaque supplies for donations, lack of funds for medicine distribution, and fuzzy communication among partners. We describe how partners in supply chains of medicine donations can tackle these issues by (a) setting up new or managing existing partnerships, (b) mapping current supply chains in emergencies and non-emergencies, and (c) managing a harmonized supply chain through transparent end-to-end flows. Once partners apply these design elements, they will make a step forward in ensuring that donations are needs-driven and based on an understanding of local cultures.