CHAPTER ONE

GENERAL INTRODUCTION

Background to Study

Essential Medicines Health Care is one of the measures of human welfare and basis for economic growth and development. Access to essential medicine is one of the fundamental human rights (Hans et al, 2003) and the provision of essential medicines constitutes one of the core elements of primary health care which aims at achieving “health for all” Christian and Florien, (2010). Most developing and middle income countries are working towards achieving the United Nations Organization (UNO) Millennium Development Goals (MDGs) set in 2000; targeting the eradication of pertinent problems affecting the population such as diseases, environmental degradation, gender inequality and others by 2015 (Pirozzi, 2012). The international development community believes that an effective supply chain of essential medicine (MDG 8, target 17) is critical to achieving at least four of MDGs which are; (a) combating disease such as malaria, HIV/AID and others (MDG6), (b) reducing child mortality (MDG4), (c) improving maternal health (MDG5), and (d) developing a global partnership for development (MDG8) (O’Neal, 2010).

The government of Cameroon is currently carrying out developmental projects in all sectors of the economy (such include food security, infrastructural development, industrial development, and others). All these are aimed at transforming or developing the country in to an emerging nation by 2035 (IMF, 2010). These goals can only be achieved if the population is in good health. Unfortunately, the inaccessibility of essential medicine to the population due to the lack of an effective supply chain management is one of the factors hindering developing countries from attaining the Millennium Development Goals target (Ulrika et al, 2004).

In the global market place, in every business type in an organization, there is increased customer demand and competition. As a result, the organization should explore a new method to run their business and deliver what the consumer wants at the right time, right place, right quantity, and right condition in an affordable price. To meet the customer needs, organization should adopt supply and value chain management as a means of driving efficiency and delivering value (Treves, 2015). With the world gradually evolving into a global economy, Africa is playing an increasing role both as a supplier and a consumer market for products from other parts of the world. So it is necessary for organizations to understand logistics and supply chain management practice in Africa. For firms that operate in Africa, it is crucial to understand the current state of logistics in the continent and has to differentiate the challenges in the system. Some of the challenges faced by countries in Africa are poor information, communication and consumption data, lack of quality assurance procedures and inadequate storage facility. The public supply chain is very complex because of Ethiopia’s large size and the expansive scope of the health program (USAID logistics hand book, 2011).

The federal ministry of health has been working to ensure an efficient and high performing health care supply chain that will ensure access to affordable medicines for all the society. In the country, supply chain challenges like inadequate quality and affordable essential drugs, poor storage conditions and weak stock management were faced by the organizations. To overcome these challenges pharmaceutical fund and supply agency developed and implement the integrated pharmaceutical logistics system (IPLS) in 2009 (USAID/ DELIVER project, 2015). On different literatures Supply Chain Management Practice defined in different ways. Among these, some of literatures defined it as follow: Li et al., (2005) define Supply chain management practice as an activity that takes place in an organization to promote effective management of its supply chain. Otto and Kotzab (2003) termed SCM practice as a special form of strategic partnership between retailers and suppliers. Alvardo and Kotzab (2001) viewed SCM practice in terms of reducing duplication effects by focusing on core competencies and using inter organizational standards such as activity based costing or electronic data interchange and eliminating unnecessary inventory level by postponing customization towards the end of the supply chain.

        Enhancing performance, reduce inventory and lead time are the short term and increasing market share and integration of supply chain are long term objectives of SCM (Koh et al., 2007). Health status of the society is one main indicator of social development and progress. And the provision of the health care is a major challenge to human life (Jahanbani et al.2016). Among the few, accompanied with the new requirement of the society, the major challenge of the health care institutions is customer dissatisfaction and increased cost of the health care services. Because of these factors health care organizations are forced to adopt a new system in dealing

with the increase in health service costing and gaining customers’ dissatisfaction (Ali et al., 2012).

            According to the World Health Organization (WHO, 2010), an estimated 65000 people die every year in Africa from malaria, HIV/AID, and tuberculosis due to lack of access to drugs. Thirty-Two percent (32%) of the world population lack access to essential medicines (WHO, 2010) and in Cameroon an estimated 50% of the population lacks access to quality drugs (Ministry of Public Health, 2009). In 2009, 30% of health units in Cameroon did not have the required minimum stock of drugs as required by W.H.O; seven out of thirteen drugs were found to be often unavailable in public health units as compared to private health units. Stock rupture of these drugs sometimes went up to 19 days (National Institute of Statistics, 2010). Based on the above, it is evident that health care units in Cameroon need to address the problem of drugs procurement and supply chain management. This is because the burden of diseases cannot be reduced without an effective supply chain that can make essential medicines more accessible to the population of Cameroon in general and of Mezam Division in particular.

            In Cameroon like elsewhere in the world, essential medicines and supplies are essential elements of all functioning health systems at all times. The government through the National Centre for Essential Drug Provision and Medical Supply (CENAME) seeks to ensure the regular supply of low cost, high quality drugs to public health establishments in the Country. Drugs purchased by CENAME (the only government wholesale unit) are distributed among the ten regional intermediate supply units (CCP). In the North West Region, the role of the CPP is carried out by the North West Regional Special Fund for Health (NWRSFH). The NWRSFH then tries to ensure the distribution of drugs to all public health facilities.

The private sector of drug supply chain is made up of both profit and non-profit making drug dealers.

These non-profit making establishments are principally confessional drug dealers or mission bodies health establishments (principally the Catholic, Presbyterians, and the Cameroon Baptist Convention (CBC) health units and others. The organization of the supply chain by these health facilities is similar to that of the public health establishments. The supply of drugs in health units run by each of the mission bodies is from wholesalers to the respective mission body central procurement Centre (not necessary to be located in Yaoundé as the case of Public sector supply chain) then to the regional distribution units, and from the regional distribution unit to the respective health centers. It should be noted that, the Cameroon government authorized these health establishments to buy essential drugs from CENAME in case of shortages or emergency (Ministry of Public Health, 2009).

In 2007 the supply of drugs by profit making health facilities constituted 70% of the drug market in Cameroon with five local manufacturers and ten of large scale distributors of which five were major distributors (UC-PHARM, LABOREX, CAMPHRAM, CCP and PHARMACAM) (Midoungue et al, 2008). LABOREX has been authorized by the state to ensure the distribution of quality drug to lay-private health facilities in the region. The supply chain follows the same pattern as in previous ones. However, this chain differs from others at the regional level where only pharmacies and private hospitals are authorized to buy drugs directly from LABOREX. Private health units/clinics are supposed to obtain drugs from pharmacies.

            One serious issue faced by this sector is that drugs of doubtful quality (sub-standard, counterfeited, expired, poorly stored drugs and non-homologated drugs by the Ministry of Public Health still occupy a large market share in the region with illegal importation occupying 40% of the Cameroon drug market (Rockefeller foundation, 2008). These drugs are mostly supplied by drug dealers who have not been authorized by the state (ghost suppliers) and do not comply with laws regulating the purchase and sale of drugs in the country. A large portion of these drugs penetrate the country through neighboring countries and then smuggled in to the region where they are retailed by provision stores, pharmacies, private hospitals, health units/clinic and hawkers. According to Rockefeller foundation (2008), the existing drug supply chain in Cameroon is characterized by: high technical regulation, limited channel choices, limited number of outlets, weak public sector role (example illegal importation from Nigeria), and follows the francophone archetype. These challenges necessitate an investigation into the supply chain of essential medicines.

Statement of problem

            Over the past decade, the Cameroon government just as many other African governments has been striving to develop an adequate health care system. Despite the efforts to develop the health system the inaccessibility (absences/inadequate drugs supply in health units) and the in affordability (high prices) of drugs is still singled out as one of the major cause of deaths in Cameroon and Africa as a whole (Ulrika et al, 2004). According to the United Nations Organization (UNO), an estimated 8500 people die every day in Sub- Saharan Africa (SSA) due to lack of access to essential drugs (Roland et al, 2005). It is thought that the high rate of inaccessibility to essential medicine by the population may be due to the fact that some health care units are still unable to develop an effective and a sustainable procurement and supply chain management system (Abayneh et al, 2006). A system that ensures that high quality drugs get to the right place, in sufficient quantity, at the right time and administered to the right patient at an affordable price as required by W.H.O. The so called Just in Time supply chain management technique helps to ensure that high quality drugs get to the right place, at the right time and in sufficient quantity (JIT or drugs arrive before they are needed) (POMS, 2010). In Bamenda, North West Region of Cameroon, the main problem responsible for the inefficient drugs procurement and supply chain management seems to be the inconsistent supply leading to drugs shortages in some health units (National Institute of Statistics, 2010). The present study focuses on the various ways of how an effective supply chain can make essential medicines more accessible to the population of Bamenda

Research questions

Main Research question

What is the effect of essential medicine supply chain practices on the performance of health units in Bamenda?

Specific Questions

The specific questions are:

• What are the effects of the procurement of essential medicine on the performance of health units?
• What are the effects of inventory control on the performance of health units?
• What are the effects of stock keeping/warehousing of essential medicine on the performance of health units?

Research objectives

Main objective

The main objective of this work is to examine the effects of essential medicines supply chain practices on the performance of health units in Bamenda.

Specific objectives

The specific objectives are to:

• Examine the effect of essential medicines procurement on the performance of health units.
• Identify the effects of inventory control of essential medicine on the performance of health units.
• Determine the effects of stock keeping/warehousing of essential medicine on the performance of health units.