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IIT Madras, Krea University study suggests ways to boost medicine supply deliveries in four states

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Conducted in TN, Kerala, Odisha, and Punjab, the study identified key operational, logistic & infrastructural challenges in drug delivery system & suggested measures to address medicine shortage

Indian Institute of Technology Madras and Krea University, Chennai, conducted a study that can help states boost medical deliveries. The study showed that fill rates of Tamil Nadu, Kerala, Odisha, and Punjab could potentially rise to 53 per cent as compared to an average fill rate of 30.95 per cent.

These four States were chosen for the study as they were the largest Indian states with the largest populations in the country. Essential medicine procurement in Indian Public health system is undertaken by the State-level medical service corporations (MSC). Some states, such as Kerala, follow a centralised system, while others like Punjab. Tamil Nadu and Odisha follow a decentralised system, which is a mix of the two.

The study found that despite the operational, logistic, and infrastructural challenges that exist in the current drug supply system, several measures can be undertaken by State Governments to considerably ease the system and address medicine shortage. It focused on issues that are identified in the procurement process of essential medicines. The medicine procurement data and contract information from the four States were central to the current study.

The study was conducted by Prof. R.P. Sundarraj, Department of Management Studies, IIT Madras, and Prof. Vijaya C. Subramanian, Department of Operations Management, IFMR-GSB, Krea University. The Research was published recently in the reputed peer-reviewed journal Social Science and Medicine.

The key findings and recommendations of the study, which was conducted between the period 2015 and 2019, include:

  • The study confirms the intuition that order timing is very important to meeting demands and that states must consider staggering their orders instead of batching them
  • While the current processes of applying penalties and blacklisting suppliers are important levers with a state, a graded manner of applying these can help alleviate issues.
  • Instead of a blacklisting process that is binary (i.e., suppliers can be blacklisted or not) states can consider blacklisting as well in a graded manner, proportional to the extent of default by a supplier
  • The study also brings out the importance of inter-state coordination

Elaborating on the need for such studies, Prof. Sundarraj said, “Essential medicine is a key issue affecting health outcomes. This is especially an issue in low and middle income countries. The Indian government recognises this and has enabled the import and production of APIs and KSMs for the manufacture of such medicines”

Further, speaking about how it has been conducted using field data, Prof. Sundarraj said, “We were fortunate to have the active support of a key policy maker who could point us to the right data sources and more importantly scope the project to address the key issues faced by state governments”

Highlighting how such studies and partnerships with State Governments can address medicine shortage in India, Prof. Subramanian said, “This work is an attempt to bridge the gap between research and policy. The current pandemic has brought into focus the urgent need to address the deficiencies in healthcare delivery. We strongly believe that collaborations such as these between policy makers and researchers can contribute to immense improvements in the current system.”

The entire research and modelling were done based on data available in the public domain, with advice from policymakers.

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