•Hospital supply chain

management

• Dr Saurabh Banerjee
THE SUPPLY CHAIN AND THE
SIX RIGHTS
•Product
selection
In public health
• Most countries have developed essential
medicine lists patterned on the World Health
Organization (WHO) Model List.
• The output of product selection is a national
essential medicines list that is guided by
standard treatment guidelines and
recommended protocols for service delivery.
• New list of essential medicines: 39 new drugs added, 16 dropped

• https://www.moneycontrol.com/news/business/companies/new-list-
of-essential-medicines-39-new-drugs-added-16-dropped-
7425241.html
Hospital setting

•HOSPITAL FORMULARY
1. IPD
2. OPD
• Tea Break
•Quantification
Quantification

• Quantification. After products have been selected,

the required quantity and cost of each product must
be determined.
• Quantification is the process of estimating the
quantity and cost of the products required for a
Hospital and determining when the products should
be procured and delivered to ensure uninterrupted
supply of products.
 Hospital setting

•Monthly consumption
• Consumables – drugs, medical gases, disposable needles
and syringes, reagents, kits, etc.
• Semi – durables – surgical instruments, linen, etc.
• Durables – equipments, laboratory instruments, etc.
•Procurement
 Procurement.
• Procurement. After a supply plan has been
developed as part of the quantification process,
products must be procured.
• This will enable the procurement to be carried
out in a timely manner, according to an open,
fair, and competitive process and to ultimately
supply quality-assured products for the hospital
•Problem in procurement in
private hospitals
Problem in procurement in private hospitals

•You have to maintain a variety

of brands for a therapeutic
segment
Rs 241 –Branded
Procurement.
Vendor selection

•Reliability of the vendor

•Legal status
•Quality of the supplied drug
•Time of delivery
•Inventory strategy
ABC VED
ABC Analysis: A, B, and C Medicines (1)

Percentage of
Budget
Percentage of
Category Medicines Ordered
Value

A medicines 70–80% 10–20%

B medicines 15–20% 10–20%

C medicines 5–10% 60–80%

VEN Analysis
 Method to prioritize for medicine purchase and stock
 V–Vital
 Potentially lifesaving
 Crucial to providing basic health services
 E–Essential
 Effective against less severe but significant illness, but
not vital
 N–Nonessential
 For minor illnesses
 High cost and low therapeutic advantage
•Warehousing
and
distribution

•Stores
Management
Stores management
• Warehousing and distribution. After an item has been
procured, its physical management, through various levels of
an supply chain, must be carried out in a structured way to
ensure that it will be protected from harmful
environmental conditions or handling and is available,
accessible, and in good condition while posing no risk of
injury to workers.
• To meet this requirement a combination of interventions
requiring both physical infrastructure and structured
procedures must be maintained.
•Storage
•Serving customers
•OPD Pharmacy
•IPD pharmacy
•Rational use
•AMR
•HEART OF THE LOGISTICS CYCLE
•The center of the logistics cycle
consists of management functions
that support the operational
components
•An LMIS collects data about the hospital
supply of and demand for commodities and
these are most often used for routine
operations, such as ordering and replenishing
supplies for health facilities.
•Logistics data are used for making informed
decisions about activities within the logistics
cycle.
 Logistics Management Information Systems
(LMIS).

• In the beginning of the cycle, hospital supply chain and

managers gather information about each activity in the
system and analyze that information to make decisions
and coordinate future actions.
• For example, information about product consumption
and inventory levels must be gathered to ensure that a
manager knows how much of a product to procure.
•IDENTIFY THE DIFFERENT
STAKEHOLDERS IN Hospital
SCM
Organizations in the Govt hospital supply chain often
include
1. departments of ministries of health (procurement, planning,
2. drug regulatory board,
3. human resources, and health programs);
4. Medical stores;
5. donors;
6. nongovernmental organizations (NGOs);
7. regions and districts;
8. health facilities;
9. community health workers; and
10. private sector partners, such as third-party logistics providers, drug
manufacturers, distributors, and private service providers
Organizations in the Govt hospital supply chain often
include
1. Departments of ministries of health (procurement, planning,
2. Drug regulatory board,
3. Human resources department ,
4. Medical stores;
5. Donors;
6. Nongovernmental organizations (NGOs);
7. Regions and districts;
8. Health facilities;
9. Community health workers; and
10. Private sector partners, such as third-party logistics providers, drug
manufacturers, distributors, and private service providers
Organizations in the Corporate hospital supply chain
often include
1. Management of the hospital
2. drug regulatory board,
3. Store in charge
4. IPD and OPD Pharmacy incharge
5. donors;
6. nongovernmental organizations (NGOs);
7. private sector partners, such as third-party logistics providers,
8. drug manufacturers,
9. distributors,
10. private service providers
Organizations in the Corporate hospital supply chain
often include
1. Management of the hospital
2. Drug regulatory board,
3. Store in charge
4. IPD and OPD Pharmacy in charge
5. Donors;
6. Nongovernmental organizations (NGOs);
7. Private sector partners, such as third-party logistics providers,
8. Drug manufacturers,
9. Distributors,
10. Private service providers
•THE ROLE OF THE SUPPLY
CHAIN MANAGER in
hospitals
•Hospital Supply chain managers
have overall responsibility to
ensure the continuous supply
of health commodities
wherever and whenever they
are needed.
• Thanks