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Introduction, development of a revolving fund pharmacy–the process, declaration.

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The Revolving Fund Pharmacy Model: backing up the Ministry of Health supply chain in western Kenya

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Imran Manji, Simon M Manyara, Beatrice Jakait, William Ogallo, Isabel C Hagedorn, Stephanie Lukas, Eunice J Kosgei, Sonak D Pastakia, The Revolving Fund Pharmacy Model: backing up the Ministry of Health supply chain in western Kenya, International Journal of Pharmacy Practice , Volume 24, Issue 5, October 2016, Pages 358–366, https://doi.org/10.1111/ijpp.12254

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A pressing challenge in low and middle-income countries (LMIC) is inadequate access to essential medicines, especially for chronic diseases. The Revolving Fund Pharmacy (RFP) model is an initiative to provide high-quality medications consistently to patients, using revenues generated from the sale of medications to sustainably resupply medications. This article describes the utilization of RFPs developed by the Academic Model Providing Access to Healthcare (AMPATH) with the aim of stimulating the implementation of similar models elsewhere to ensure sustainable access to quality and affordable medications in similar LMIC settings.

The service evaluation of three pilot RFPs started between April 2011 and January 2012 in select government facilities is described. The evaluation assessed cross-sectional availability of essential medicines before and after implementation of the RFPs, number of patient encounters and the impact of community awareness activities.

Availability of essential medicines in the three pilot RFPs increased from 40%, 36% and <10% to 90%, 94% and 91% respectively. After the first year of operation, the pilot RFPs had a total of 33 714 patient encounters. As of February 2014, almost 3 years after starting up the first RFP, the RFPs had a total of 115 991 patient encounters. In the Eldoret RFP, community awareness activities led to a 51% increase in sales.

With proper oversight and stakeholder involvement, this model is a potential solution to improve availability of essential medicines in LMICs. These pilots exemplify the feasibility of implementing and scaling up this model in other locations.

A pressing challenge in low- and middle-income countries is inadequate access to essential medicines and medical supplies. The United Nations Development Program (UNDP) through target 5 of Millennium Development Goal 8, recognizes the importance of increasing the availability of affordable medicines for the world’s poor. UNDP aims to reduce poverty by 50% by the year 2015, and one indicator of this initiative is the proportion of the population with access to affordable, essential drugs on a sustainable basis. [ 1 , 2 ] In 2008, the World Health Organization (WHO) resolved to improve the delivery of and access to all health products and medical devices by working toward overcoming barriers to access. [ 3 , 4 ] In an effort to provide greater guidance to developing world health systems, the WHO has created a list of minimum medicine needs for a basic healthcare system (the Model List of Essential Medicines). It includes the most clinically effective and cost-effective medicines for priority conditions. [ 5 ]

One method for overcoming the barriers to access to essential medicines is the revolving drug fund (RDF). The RDF concept was first introduced in Sub-Saharan Africa (SSA) in the 1980s through the Bamako Initiative, as a strategy to increase the availability of essential medicines in the region. [ 6 ] In the RDF model, an initial stock of essential medicines is obtained through donations or purchase. The medicines are then sold at a markup, which is sufficient to replenish the stock and ensure self-sustainability, but small enough to ensure that the medicines remain affordable to those who need them. [ 6–8 ]

While early implementation of the RDF approach had various failings and criticisms, analysis of its impact on the availability of essential drugs in primary healthcare facilities in south-east Nigeria by Uzochukwu et al . shows better availability both in number and in average drug stock in Bamako Initiative health facilities compared to the non-Bamako Initiative health facilities. [ 9 , 10 ] However, many of these initiatives have since disappeared due to lack of political will or waning support from the community. [ 11 ]

More than three decades later, despite demonstrating great improvements in the availability of HIV medicines throughout SSA, access to other essential medications within the public sector remains a largely unmet need within most settings. [ 3 ]

In Kenya, the Ministry of Health (MOH) through the Kenya Medical Supplies Agency (KEMSA) is in charge of supplying government healthcare facilities with medications. Every government health facility has a pharmacy that is stocked with medicines supplied by KEMSA that patients can access at low costs. However, availability of essential medicines within pharmacies in public facilities can be challenging. A 2009 MOH survey on access to essential medicines in Kenya reported a median availability of 67% of essential medicines in government health facilities. The survey further reported that medicines in government health facilities were out-of-stock for a median duration of 46 days in a year, with 14% of facilities experiencing durations that were greater than 90 days. [ 12 ] This presents a great challenge to patients who often resort to going without the medications or buying them from private commercial pharmacies when they are unavailable in public facilities. This is concerning considering that private pharmacies are usually more expensive ( Table 1 ), harder to access and of indeterminate quality. A 2005 survey by the National Quality Control Laboratory and the Pharmacy and Poisons Board of Kenya found that 30% of medications primarily in the Kenyan private market were substandard. [ 13 ]

Comparison of select medication costs per tablet for Private * versus Revolving Fund Pharmacies (RFP)

Prices at private pharmacies were collected by visiting commercial pharmacies in Eldoret, Kenya. The prices were converted to US dollars (Exchange Rate used: 80 KES = 1 USD).

In response to these challenges, the Academic Model Providing Access to Healthcare (AMPATH) has implemented Revolving Fund Pharmacies (RFPs) in western Kenya. The United States Agency for International Development (USAID)-AMPATH Partnership, in cooperation with the MOH, delivers community- and facility-based healthcare services to a population of more than 3.5 million persons in western Kenya. It is one of the largest and most comprehensive HIV/AIDS care programmes in SSA and is rapidly expanding its focus to incorporate primary healthcare, chronic disease management and other aspects of health. In its vast western Kenyan catchment area, AMPATH delivers HIV care and treatment services to >150 000 ever enrolled HIV-infected persons through 65 MOH facilities. [ 14 ] AMPATH, in collaboration with stakeholders from the MOH and local communities, has been implementing the RFP model at several of its sites, while providing appropriate controls in order to ensure success and sustainability. This model is aimed at ensuring that all patients and particularly those with chronic diseases have access to a continuous supply of essential medicines.

Guiding principles for RFP

Based on the unique healthcare system dynamics found in western Kenya, we have developed RFPs around the principles seen in Table 2 , which has led us to the implementation dynamics also seen in Figure 1 . The RFPs, which are typically located within public health facilities but are distinct in operation from the government pharmacies, serve as a backup source of medications when they are not available at the government pharmacies. Figure 1 illustrates the perpetual revolving nature of our activities and the basic dynamics, which have ensured the sustainability of the RFP.

Guiding principles built in to the design of the RFP model and their implication on implementation

AMPATH, Academic Model Providing Access to Healthcare; LMIC, low and middle-income countries; MOH, ministry of Health; RFP, revolving fund pharmacy.

Dynamics of revolving fund pharmacy.

Revolving fund pharmacies are typically initiated in a stepwise fashion with the process starting with a thorough needs assessment of the medication availability, supply chain issues, staffing and security issues at each site. Equipped with this data and clear documentation of the needs, relevant stakeholders are then engaged, which typically includes the MOH Facility Management Team, the AMPATH RFP team, and members of the local community. This emphasis on engagement then informs the daily operations as we work together to define the optimal workflow and patient flow dynamics in each setting. During these meetings, we establish a memorandum of understanding to govern the operations. This describes the staffing arrangements and pricing structure to ensure the RFP does not compete with MOH pharmacy infrastructure. Because of this dynamic, the RFP pharmacies charge slightly more than the government pharmacy as seen in Figures 1 and 2 . In an effort to reduce operating costs, any available government staff who are appropriately trained are utilized within this model. As RFP patient volumes and subsequent revenue continues to grow, additional staff are hired from these funds to ensure a high level of quality is provided with minimal wait times. This typically includes hiring a cashier to ensure all cash collections maintain the highest level of integrity to prevent any misappropriation of funds. After agreeing upon these foundational aspects, we purchase an initial 3-month supply of medications to seed the pharmacies by utilizing funds from donors or profits from other RFPs. As these basic underlying dynamics are established, a management committee is appointed to provide oversight of the pharmacy and ensure that regular audits are performed and reports are disseminated.

Patient flow in public sector medication acquisition and the role of revolving fund pharmacies.

The novelty of this service also necessitates investment on community awareness. To meet this need, we have hired peer educators to directly inform patients of the various facets of the RFP at the clinics where they are available and also within the community by holding village meetings called ‘barazas’ where community members commonly gather.

The objective of this paper is to describe the utilization of the RFP model within the AMPATH catchment area. It is hoped that the description can stimulate the implementation of such models elsewhere with the aim of ensuring sustainable access to quality medications in low and middle-income countries (LMICs).

This paper describes the service evaluation of pilot RFPs started between April 2011 and January 2012 within our catchment area of western Kenya. Between one to 3 months prior to the implementation of RFPs through this project, a cross-sectional availability assessment of 75 essential medications that the Kenyan MOH is responsible for supplying to facilities was performed at potential implementation sites. This evaluation was performed to generate a rough estimation of the needs of the potential implementation site facilities and to project the quantities of different medications needed to provide comprehensive care beyond HIV. The assessment analysed infrastructural needs and staffing needs in addition to a focused assessment of medication availability. This paper focuses on the findings related to medication availability. The medication assessment was performed by sending out experienced auditors (typically pharmaceutical technologists with good knowledge of medicines) to the facilities who compared the list of medications that are supposed to be kept within each facility to the actual stocks of medications of that facility. The percentage availability was then calculated by dividing the number of medications available by the total number of medications that are supposed to be stocked at each facility. The availability on the day of the evaluation was then reported as the availability for that facility. We also captured anecdotal information from pharmacy staff at the facilities on the perceived trends of availability of medications for the RFP team’s own projections; however, this qualitative information is not reported here.

Three initial implementation sites were selected for implementation of the RFPs based primarily on the facilities’ ability to provide space and staff, and the joint desire among the stakeholders to expand care access beyond HIV in these settings. These three health facilities included Mosoriot Health Centre, Turbo Health Centre and Eldoret HIV clinic based at Moi Teaching and Referral Hospital (MTRH). Mosoriot and Turbo Health Centres are both located in rural areas serving a catchment population of 49 095 and 208 583, respectively, based on 2009 census data. The Eldoret RFP is situated in a semiurban setting with a population of roughly 252 061 people. [ 15 ]

In order to provide a descriptive assessment of the utilization of the RFPs and the number of patients served, audit reports and prescription data were used to evaluate the types of medications dispensed and the change in patient volumes. Auditing activities include a physical stock take, reconciliation of all cash collections with medication dispensing to determine the sales and profits, if any, for the period, and prescription tracking to determine the number of patient encounters. RFP staff also tracked this information at specific time points to identify the impact of the community awareness activities through peer educators. However, during the pilot phase, the peer educators were only introduced at the Eldoret RFP and so the impact of community awareness activities was only assessed for the Eldoret RFP. The typical frequency for performing all of these evaluations depends on the maturation process for each RFP with the three RFPs included in this assessment starting with assessments on a weekly basis for the first 1–2 months, then every 2 weeks for the next 2 months, and then graduating to a monthly or bimonthly review. The frequency of review also depends on the stock availability and frequency of delivery as we simultaneously review facilities as we deliver additional stocks to reduce transportation costs.

Ethics approval for the evaluation was obtained from the Institutional Review and Ethics Committee (IREC) at MTRH and Moi University College of Health Sciences.

During the period of evaluation, three pilot RFP sites were started with formal agreements established with the management of the overarching facilities.

For the selected sites, the initial cross-sectional availability of medications in Mosoriot health centre was 40%, while Turbo health centre was 36%. [ 16 ] Moi Teaching Referral Hospital in Eldoret houses an outpatient HIV clinic that previously only stocked non-HIV medications when they were donated, so their availability was less than 10%.

Within each of the RFPs, the number of patient encounters had rapidly grown over the period of assessment as seen in Figure 3 . In the first quarter of operations, the lowest volume RFP had an average number of 89 patient encounters each week. However, by the fourth quarter of evaluation, the RFPs each had an average of over 200 patient encounters per week. During 1 year of evaluation, the three sites had a combined total of 33 714 patient encounters. Since many patients typically receive a prescription for more than one drug, the number of medications supplied is far more than this total, with the same patients likely returning for refills. As of February 2014, the first three RFPs have had a total of 115 991 patient encounters, with an average of 21%, 25% and 39% of total sales being attributable to chronic disease medicines in the Mosoriot Health Centre, Turbo Health Centre and Eldoret HIV clinic RFPs respectively. After about 4 months of standard operation in the Eldoret RFP, we introduced the peer educator advocacy model to increase awareness of the availability of the RFP services. Through the separate analysis performed on the impact of this modality of promotion, a 51% increase in sales was observed after having peer educators describe the RFP model to patients in the waiting areas as seen in Figure 4 . This advocacy model was then introduced in all RFP sites as part of the standard operating model because of the pronounced impact on utilization of RFP services.

Trend of patient utilization of the revolving fund pharmacies over the first year of operation in three sites.

Impact of peer educator on average daily collection.

In February 2014, nearly 3 years after starting the first RFP, a cross-sectional analysis revealed that Mosoriot Health Centre’s availability was 90%, Turbo Health Centre’s was 94% and the Eldoret HIV clinic’s was 91%. All three facilities have demonstrated profitable operations after 1 year of operation and have only had to provide a waiver for services for less than 2% of patients served. All RFPs are still in operation and continue to enjoy an outpouring of support from the communities and facilities where they operate.

The findings of this study suggest that the RFP model can substantially and sustainably increase medication availability and utilization in LMIC settings. This is especially important as healthcare systems within these settings grapple with the dual burden of diseases attributed to communicable and non-communicable diseases.

One of the key strengths of this investigation is that it provides unique insight into the dynamics and feasibility of addressing the marked deficiencies in supply chains seen in LMICs. There are limited practical evaluations describing the factors required for the contextualized implementation of pharmacy services in LMIC settings.

The rapid increase in utilization of the RFPs illustrates the dramatic increase in public sector facility utilization that can occur when supply chain issues are addressed. While the data are not sufficient to determine the precise reason for this growth pattern, it is likely related to multiple factors including the MOH’s continued struggle in ensuring a reliable supply of medicines, the patients’ growing awareness and acceptance of the RFP, increased trust in facilities, and expansion of care to include chronic diseases. The emphasis on involving the local community is also likely to have contributed to the increase in patient numbers. In addition, the use of peer educators to provide targeted education to the community appeared to have had an impact on the increase in patient numbers. Because of the dramatic impact of this service in the Eldoret RFP, peer educators have been introduced as a standard component of the process for initiating and informing the community of new RFPs.

Lack of medicines is costly to the health of patients and detrimental to generating demand among patients to obtain care for chronic diseases. In the ecosystem of MOH facilities, it can sometimes take months until the medications are available countrywide. This dynamic often results in patients typically deciding to forego the transportation costs associated with going to clinic and deciding not to rely on public sector facilities for their health care needs. Because of the immense resource constraints in this setting, this leads to excess morbidity and mortality, as the majority of people do not have the funds available to receive care in the private sector.

One of the key limitations of this analysis is the utilization of a health service evaluation approach. While it does not provide the definitive assessment of impact that a randomized control trial would offer, it does provide insight on the real world application of a sustainable model for improving medication availability. Another limitation is the utilization of a cross-sectional analysis for estimating the availability of medications prior to the implementation of the RFP. While it only provides a limited snapshot of medication availability, the anecdotal comments of the staff received during the evaluation are consistent with the unacceptably low availability found during the evaluation.

In addition to the many positive experiences described with the RFP, several challenges have been faced in the process of implementing the RFPs. Because each RFP serves as a backup when the MOH pharmacy runs out of medicines, the need for specific medications is highly variable and forecasting medication supply needs was initially a challenge in the absence of appropriate data. Compounding this challenge, in 2012, Kenya struggled with multiple nationwide doctors’ and nurses’ strikes, which considerably decreased utilization. This made it difficult to accurately predict the medication consumption.

Despite these challenges and limitations, the early experience with the RFP initiative has been successful by the different metrics described in this paper. It has been able to improve access to essential medicines as did similar models implemented in west Africa through the Bamako initiative. [ 9 , 10 ] Although some of these RDF initiatives are no longer in existence due to lack of political will to keep them running, it is hoped that the AMPATH RFP model will be sustainable in the long run largely because of its tripartite management structure that has a strong community ownership component. [ 11 ]

The success of the RFP model has helped support the broad expansion of the underlying principles of this model. AMPATH is now using this infrastructure to support the provision of essential laboratory services based on the same model, with two sites carrying point of care laboratory supplies in their RFP. Laboratory infrastructure includes reagents needed for the improvement of the overarching government healthcare system, but has a specific emphasis on tests needed for chronic diseases. This includes a basic metabolic panel, point of care glucose test strips and pregnancy tests.

Following the success of the pilot sites, the model has been scaled up to include nine other sites in 2013 and 2014, and another eight RFPs are projected to be implemented by the end of 2015. The RFP model has also been implemented at a smaller scale for chronic disease medications in over 30 village dispensaries within the AMPATH catchment area and has been able to sustainably avail these medications closer to the people who need them. It is hoped that the RFP model will be scaled throughout western Kenya with subsequent implementation throughout the rest of Kenya.

The success of AMPATH’s RFP model has led to thousands of patients in both rural and urban settings gaining access to essential medicines through a backup of the MOH pharmacies. These patients would have been forced to pay substantially higher amounts at commercial pharmacies or, more likely, go without medication.

By building relationships with public healthcare facilities and communities, and developing a carefully thought out implementation model and monitoring system, revolving fund pharmacies can improve medication access for populations in LMICs. With the growing burden of chronic diseases throughout Kenya, the RFP represents a viable solution for ensuring public sector facilities can sustainably provide medications to prevent the inevitable morbidity and mortality anticipated from chronic diseases in the coming years.

Conflict of interest

The Author(s) declare that they have no conflicts of interest to disclose except Sonak D Pastakia has received fees for serving as a speaker and consultant for Abbott within the last 3 years.

This research received no specific grant from any funding agency in the public, commercial or not-for-profit sectors.

Author’s contributions

Imran Manji is the Project lead and primary author; he contributed to conceiving and implementing the idea and coordinated all aspects of manuscript development. Simon Manyara is the Project coordinator; he contributed to implementation of the idea as well as writing and reviewing of the manuscript. Beatrice Jakait is the Associate Program Manager for Pharmacy Operations; contributed to reviewing the manuscript. William Ogallo, Isabel C. Hagedorn and Stephanie Lukas were Global Health Pharmacy Residents at the time the manuscript was being developed; they contributed to generating the first drafts of the manuscript. Eunice J. Kosgei is the lead pharmaceutical technologist for the project; she was involved in the implementation of the idea and contributed to reviewing the manuscript. Sonak D. Pastakia is an Associate Professor, Purdue University College of Pharmacy; he contributed to conceiving and implementing the idea and reviewing the manuscript. Ethics approval to carry out this study was obtained from the Moi University and MTRH IREC, Eldoret, Kenya (Ref: IREC 000993).

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Eastern Mediterranean health journal = La revue de santé de la Méditerranée orientale = al-Majallah al-ṣiḥḥīyah li-sharq al-mutawassiṭ

Sophie Witter

Ensuring a reliable and affordable supply of essential drugs to health facilities is one of the main challenges facing developing countries. This paper describes the revolving drug fund in Khartoum, which was set up in 1989 to improve access to high quality drugs across the State. An evaluation in 2004 showed that the fund has successfully managed a number of threats to its financial sustainability and has expanded its network of facilities, its range of products and its financial assets. It now supplies essential drugs to 3 million out of the 5 million population of Khartoum each year, at prices between 40% and 100% less than alternative sources. However, results illustrated the tension between achieving an efficient cost-recovery system and access for the poorest.

nouria brikci

Amjad Idries

The aim of this study was to generate baseline data regarding the accessibility to essential drugs, the affordability and willingness of patients to pay in addition to gathering information about patients’ satisfaction regarding the RDF services in the Northern Sudan. It was carried as a cross-sectional facility based study. Although the performance of the RDF system seems to be satisfactory according to the results obtained, continuing of the efforts to increase the awareness about the RDF services among the public essential in addition the continuous evaluation of the quality of the services provided is recommended.

Chinwe C Obuaku-Igwe

Within every functional healthcare system, access to quality and affordable essential medicine stands out as one of the building blocks. However, its significance has been underrated due to poor advocacy and research. The implication is that access to quality and affordable essential medicines remains a challenge to many people in low / middle income countries and could create difficulty in the attempt to reform healthcare systems and save lives if not given ample attention. This paper presents a critical discussion of the Nigerian health system with special focus on access to essential medicines as a component of the Nigerian healthcare system by drawing upon primary data, using qualitative research method. Résumé Au sein de chaque système de santé fonctionnel, l'accès aux médicaments essentiels de qualité et à prix abordable se distingue comme l'un des blocs de construction. Cependant , son importance a été sous-estimé en raison de la mauvaise sensibilisation et de recherche. L'implication est que l'accès à la qualité et aux médicaments essentiels abordables demeure un défi pour de nombreuses personnes dans les pays à faible revenu / moyennes et pourrait créer des difficultés dans la tentative de réformer les systèmes de soins de santé et sauver des vies si pas donné une grande attention. Cet article présente une enquête sur le système de santé du Nigeria avec un accent particulier sur l'accès aux médicaments essentiels en tant que composante du système de soins de santé du Nigeria en tirant sur des données primaires , en utilisant la méthode de recherche qualitative. Mots clés : Accès aux médicaments, les médicaments essentiels, la santé, les établissements de santé publics, les médicaments contrefaits, des médicaments traditionnels, les systèmes de santé, de la théorie des

Nigerian journal of clinical practice

Kabir Sabitu

OBJECTIVE To assess the availability of essential drugs and the perceptions of clients on drugs situation in the primary health centres of Tafa Local Government Area, north central Nigeria. METHODS Checklist consisting of minimum drugs expected in a generic primary health centre developed by the National Primary Health Care Development Agency (NPHCDA) was adopted and used to assess drugs availability, while Focus Group Discussions were conducted to determine the perceptions of clients on drugs situation in the health centres. RESULTS Results show that, all the 3 primary health centres in Tafa LGA do not implement Bamako initiative (BI) and none was operating Drug Revolving Fund (DRF) system. Out of the minimum recommended score of 54 points for the availability and adequacy of drugs and consumables, New Wuse primary health centre in the LGAheadquarters scored highest points of 19, while New Bwari and Iku primary health centres scored 13 points each. All these are far below the minim...

Shafiu Mohammed

ClinicoEconomics and Outcomes Research

aderaw yenet

Value in Health

Paul Gavaza

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Nigeria’s Drug Revolving Fund: A Conversation with Tukur Ibrahim

The fund helps provide more reliable access to quality medicines and healthcare services at affordable prices, equity in accessing healthcare services, increased patient turnout, and improved patient confidence.

Drug revolving funds (DRFs) are a financing mechanism used in healthcare to improve access to essential drugs and medicines. The primary goal of a DRF is to ensure a steady supply of quality medications and to prevent stockouts or shortages in public health facilities, such as hospitals and health centers.

The fund starts with an initial capital injection from the government, international donors, or other sources, which is used to purchase essential medicines and medical supplies in bulk at discounted prices. They are then distributed to public healthcare facilities at affordable prices. The facilities can then sell these medicines to patients at cost-recovery prices plus a small mark-up, often lower than market prices but that covers the medicine costs. Funds from the medications purchased by the patients go back into the revolving fund. This creates a self-sustaining mechanism whereby the money generated from sales is used to replenish and buy more medicines to ensure a continuous supply.

DRFs typically have quality-control mechanisms to ensure that only safe and effective medicines are procured and distributed. This involves proper storage, monitoring expiration dates, and ensuring adherence to standard treatment guidelines.

To learn more about DRF implementation, we spoke with Pharmacist Tukur Ibrahim, Senior DRF Manager in Nigeria for the Chemonics-implemented USAID Global Health Supply Chain Program-Procurement and Supply Management (GHSC-PSM) project.

Could you describe what the DRF is and how it is designed to work in Nigeria?

A DRF scheme uses an initial fund to procure medicines (seed stock) for use in the health system on a user-fee basis for sustainability. Users pay just enough to cover their treatment. The funds collected from users are in turn used to buy DRF products and the process continues.

To ensure the seed stock given is adequate for the DRF, a quantification exercise is conducted and, based on the number of health facilities to be supported, procurement is made to cover them. The type and amount of seed stock to be given depends on the intervention by the donor. Each facility receives seed stock based on patient turnover, warehouse capacity, and availability of human resources for health to manage the commodities.

The DRF strategy ensures adequate protective governance structures are in place before initiating key but vulnerable processes such as investments in seed stock, procurements, distribution, training, and health facility rollout. The strategy is expected to attain a certain minimum level of performance as a prerequisite for health commodity integration at the state level. All the governing structures are to ensure compliance with the DRF operational guidelines and standard operating procedures for sustainability.

Which stakeholders are involved in the execution of the DRF and how is the DRF designed to ensure their continued stability as part of the DRF workflow?

Nigeria’s national DRF guidelines encourage states to establish an agency solely responsible for sourcing, procurement, warehousing, sales, and distribution of drugs and medical consumables for all public health commodities. That is the state Drug Management Agency (DMA), which sources, procures, warehouses, sells, and distributes medical commodities for the DRF. The agency also manages all public health commodities that are not for the DRF. Its running cost is from program sustenance, which is one of the five mark-up elements added to the cost of drugs and medical consumables. The other elements are inflation, monitoring and evaluation, losses and expiries, and deferral and exemption. At the end of every month, the DMA and facilities calculate and disburse the mark-up to the various mark-up elements. The inflation mark-up element is meant to take care of any currency devaluation which will lead to inflation. The accrued money will enable the DMA and facilities to maintain their stock level. Hence, minimal currency devaluation will not have much negative effect on the DRF.

The Hospitals Management Board and State Primary Development Agency own, supervise, and control all secondary and primary health facilities, respectively. The agencies get their running cost from the state, and there are small mark-ups from the services rendered by the facilities that go to the agencies from their respective facilities.

The DRF Steering Committee is a high-level policymaking committee that guides DRF policies and implementation across the state. The Commissioner for Health is the chair, and the Director of Pharmaceutical Services is the secretary. All heads of agencies under the State Ministry of Health are committee members. This committee leverages the mark-up from the services to carry out their roles and responsibilities.

A state DRF committee operates in all states implementing a DRF in Nigeria. It has oversight of DRF implementation at all levels. The membership is drawn from different ministries, agencies, civil society organizations, and community representatives. This committee gets funding from the DRF mark-up to carry out its roles and responsibilities. Each facility that implements the DRF has a DRF committee that ensures the DRF is working at the facility level. The facility DRF committee has funding from the net revenue generated from the services rendered by the facility (internal market operation).

What is the impact on people in the health facilities where the DRF is implemented? Do you have any data that reflects this?

The impact of the DRF includes reliable access to quality medicines and health care services made available at affordable prices, equity in accessing health care services, increased patient turnout at health facilities, and improved patient confidence in accessing public health facilities. Also, because the DRF operates with a small mark-up at public health facilities, it leads to better and affordable prices of medicines and healthcare services in private health facilities because of competition between the two sectors.

For example, the quarterly DRF activities for Muhammadu Abdullahi Wase Teaching Hospital in northern Kano State increased across all parameters. In the first quarter of 2022, 37,055 patients visited the pharmacy, compared to 63,332 in the fourth quarter of that year. Patient turnover at the facility almost doubled from 40,883 to 76,069 in the same period. This indicates increased demand for and availability of quality medicines and healthcare services. An increase in enrollees for the National Health Insurance Scheme and State Health Contributory Scheme also indicates the community has confidence in the facility.

Could you highlight some of the challenges moving ahead for implementing the DRF?

Some challenges include getting strong political buy-in from the state leadership, compliance with the DRF operational guidelines and standard operating procedures, and consistent implementation of the DRF.

Additional challenges include the need for robust monitoring and supervision (M&E) despite a well-structured M&E framework, inadequate funding for stock replenishment, and limited items supplied as seed stock by USAID through GHSC-PSM. For example, USAID provides 22 line items of seed stock for malaria and maternal, newborn, and child health medicines, while an ideal DRF system has more than 500 line items. This means facilities lack a wide variety of DRF commodities. Therefore, the DMA has to use the sales from the 22 line items of seed stock provided to procure other line items to satisfy the total stock needs at the facilities, contributing to stockouts of the DRF items.

Another challenge to the DRF is ensuring cash and carry to minimize the risk of de-capitalizing, which is when a DRF facility loses from its initial fund value provided as capital. It is one of the important guiding principles of the DRF. It stipulates that the payment for DRF items should be collected at the time of delivery at all levels: between DMA and health facilities, between health facilities and their respective service units (Internal Market Operations), and when dispensing DRF items to patients.

About Tukur Ibrahim

Tukur Ibrahim is an expert in Drug Revolving Fund (DRF) design and implementation with 28 years of supply chain experience, including 7 years implementing health programs focused on ensuring the availability of essential drugs in Nigeria. He has expertise in logistics and supply chain management, designing programs that ensure availability of medicines through an effective…

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How to establish a successful revolving drug fund: the experience of Khartoum state in the Sudan

Comment mettre en place avec succès un fonds renouvelable pour l’achat des médicaments : expérience de l’etat de khartoum au soudan, cómo establecer un fondo rotatorio para medicamentos: la experiencia del estado de khartoum, sudán, كيف يمكن إنشاء صندوق دائر ناجح للأدوية: تجربة ولاية الخرطوم، بالسودان, gamal khalafalla mohamed ali.

a Public Health Institute, Khartoum, the Sudan.

During the 1990s, the Sudan began several initiatives to establish new medicine-financing mechanisms as part of the health reform process. Initial seed stocks were provided to each hospital. Unfortunately these facility-based funds did not regenerate and the hospitals were left without funds for medicines. The Revolving Drug Fund (RDF) was established in 1989 to facilitate access to medicines in health facilities in Khartoum state.

This study used quantitative and qualitative research techniques to collect data from health-care providers and users to evaluate the experience of operating an RDF in Khartoum state. Data from personal observations and from archival and statistical records were also analysed. Seven health facilities were sampled for this research.

Local setting

The Ministry of Health has a policy to expand the RDF to the whole country and has already commenced roll-out to seven more states. This policy is based on the experience of the RDF within Khartoum state.

Relevant changes

Khartoum state has a high (97%) level of availability of essential medicines and this is attributed to the RDF. The RDF medicines were mostly considered affordable by users and very few (6%) patients failed to obtain the prescribed medicines for financial reasons.

Lessons learned

The RDF could be successfully replicated in other states of the Sudan and in low-income countries with similar contexts on condition that they meet success factors, such as gradual implementation, political commitment and availability of hard currency.

Résumé

Problématique.

Au cours des années 90, le Soudan a lancé plusieurs initiatives pour établir de nouveaux mécanismes de financement des médicaments dans le cadre du processus de réforme du système de santé. Des stocks de départ ont été fournis à chaque hôpital. Malheureusement, ces fonds établis dans des établissements de santé ne se sont pas régénérés et les hôpitaux sont restés sans financement pour leurs médicaments. Le Fonds renouvelable pour l’achat de médicaments (RDF) a été mis en place en 1989 pour faciliter l’accès aux médicaments dans les établissements de soins de l’Etat de Khartoum.

Démarche

La présente étude a utilisé des techniques quantitatives et qualitatives pour recueillir des données auprès des prestateurs de soins et des usagers, en vue d’évaluer l’expérience acquise avec l’exploitation du RDF dans l’Etat de Khartoum. Des données provenant d’observateurs individuels, d’archives et d’enregistrements statistiques ont aussi été analysées. La disponibilité des médicaments a été contrôlée dans sept établissements de soins.

Contexte local

Le Ministère de la santé s’est fixé comme politique de développer le RDF dans l’ensemble du pays et a déjà commencé à étendre ce dispositif à sept Etats supplémentaires. Cette politique repose sur l’expérience acquise avec le RDF dans l’Etat de Khartoum.

Modifications pertinentes

L’Etat de Khartoum présente un taux élevé (97%) de disponibilité des médicaments essentiels et cette situation est attribuée au RDF. Les médicaments bénéficiant du RDF sont pour la plupart considérés comme abordables par les utilisateurs et très peu de malades (6%) ne peuvent obtenir les médicaments qui leur sont prescrits pour des raisons financières.

Enseignements tirés

Le RDF pourrait être transposé avec succès dans d’autres Etats du Soudan et dans des pays à faible revenu offrant un contexte similaire, sous réserve que certaines exigences nécessaires à son succès soient remplies, telles qu’une mise en œuvre graduelle, un engagement politique et la disponibilité d’une monnaie forte.

Durante los años noventa el Sudán emprendió varias iniciativas para establecer nuevos mecanismos de financiación de los medicamentos como parte de su proceso de reforma sanitaria. Se proporcionó una reserva inicial a cada hospital, pero lamentablemente esos fondos basados en los servicios no se repusieron y los hospitales se quedaron sin medios para adquirir fármacos. En 1989 se creó el Fondo Rotatorio para Medicamentos (FRM) al objeto de facilitar el acceso a los fármacos en los servicios de salud del Estado de Khartoum.

Se emplearon técnicas cuantitativas y cualitativas para reunir datos de los proveedores de atención y los usuarios a fin de evaluar la experiencia de manejo de un FRM en el Estado de Khartoum. Se analizaron también datos procedentes de observaciones personales y de archivos y registros estadísticos. La investigación se llevó a cabo con una muestra de siete centros de salud.

Contexto local

El Ministerio de Salud ha adoptado la política de expandir el FRM a todo el país y ha iniciado ya el despliegue del sistema a otros siete Estados. Dicha política está basada en la experiencia del FRM en el Estado de Khartoum.

Cambios destacables

El Estado de Khartoum ofrece una alta disponibilidad (97%) de medicamentos esenciales, lo que se atribuye al FRM. Los medicamentos conseguidos mediante ese sistema fueron considerados en su mayoría asequibles por los usuarios, y fueron muy pocos (6%) los pacientes que no lograron obtener los medicamentos prescritos por razones financieras.

Enseñanzas extraídas

El FRM se podría reproducir eficazmente en otros Estados del Sudán y en países de bajos ingresos en circunstancias similares a condición de que se den algunos factores favorables como son una implementación progresiva, el compromiso político y la disponibilidad de una moneda fuerte.

ملخص

المشكلة.

بدأ السودان، خلال حقبة التسعينات، وفي إطار عملية الإصلاح الصحي، تنفيذ عدة مبادرات لإنشاء آليات جديدة لتمويل الأدوية. وقد زُوِّد كل مستشفى برصيد مبدئي من الأدوية، إلا أن الاعتمادات المالية الخاصة بهذه المرافق لم يتم، للأسف، تجديدها، وتُركت المستشفيات دون أموال لتدبير الأدوية. لذلك، فقد أنشئ الصندوق الدائر للأدوية في عام 1989 من أجل تيسير الحصول على الأدوية في المرافق الصحية بولاية الخرطوم.

الأسلوب

استخدمت في هذه الدراسة أساليب بحثية كمية ونوعية لجمع البيانات من مقدمي ومستخدمي خدمات الرعاية الصحية وذلك لتقييم التجربة الخاصة بعمل الصندوق الدائر للأدوية في ولاية الخرطوم. وحللت كذلك البيانات المستقاة من الملاحظات الشخصية ومن سجلات المحفوظات والسجلات الإحصائية، واختير سبعة مرافق صحية كعينة لهذا البحث.

المرفق المحلي

لدى وزارة الصحة سياسة لمد نطاق الصندوق الدائر للأدوية ليشمل القطر بكامله، وبدأ تعميمه بالفعل في سبع ولايات. وترتكز هذه السياسة على تجربة الصندوق الدائر للأدوية في ولاية الخرطوم.

التغيرات ذات العلاقة

تتمتع ولاية الخرطوم بمعدل مرتفع (97%) لتوفر الأدوية الأساسية، ويُعزى ذلك إلى وجود الصندوق الدائر للأدوية. وتعد الأدوية المتوفرة من خلال الصندوق، في غالب الأحوال، من الأدوية الميسورة الكلفة لمستخدمي الصندوق. وكان عدد قليل جداً من المرضى (6%) هم الذين لم يتمكنوا من الحصول على الأدوية الموصوفة لهم، لأسباب مالية.

الدروس المستفادة

يمكن بنجاح إنشاء صناديق دائرة للأدوية في ولايات أخرى بالسودان وفي البلدان المنخفضة الدخل ذات الظروف المشابهة، شريطة توفر عوامل النجاح لها، مثل التنفيذ التدريجي، ووجود الالتزام السياسي، وتوفر العملة الصعبة.

Introduction

One of the methods for financing medicines is a Revolving Drug Fund (RDF) in which, after an initial capital investment, drug supplies are replenished with monies collected from the sales of drugs. 1 The RDF of the Ministry of Health in Khartoum state, the Sudan, was implemented with the financial support of Save the Children (in the United Kingdom) to improve chronic shortages of medicines in public health centres. The project’s expected outcomes also include establishing an effective self-sustaining medicine supply system and promoting community participation in providing health care. After the first capital investment was made by Save the Children (United Kingdom) in 1989, the RDF used its revenues of pharmaceutical sales to procure more medicines.

There is limited evidence available concerning the effects of RDFs on utilization of public health-care facilities and it is mainly from short-term, small-scale, and often externally funded projects, from the northwest province of Cameroon, 2 Ghana, 3 Vientiane municipality in the Lao People’s Democratic Republic, 4 Nigeria, 5 Viet Nam 6 and Zimbabwe. 7 These studies did not give a comprehensive evaluation of the projects that were assessed. This paper aims to highlight the findings of a recent evaluation study of the RDF in Khartoum state. It also presents several lessons that could be learned from this experience.

Interviews were conducted with 14 senior policy-makers at the Ministry of Health to explore their perceptions about the effects of the RDF on accessibility to medicines and factors that have determined the survival of the RDF. A total of 27 practitioners were also interviewed to gather information about the availability of quality medicines.

The qualitative information was cross-checked with quantitative data collected from 93 patients and 93 households from the catchment areas of selected health facilities. A feasible sample size was set in terms of the available time and resources. In addition, archival records were verified to enable the gathering of data about availability of medicines. Finally, systematic observations were conducted using checklists to check the availability of medicines during visits to health facilities. This information was collected from two sets of health facilities. The RDF facilities comprised one teaching hospital, one rural hospital and three health centres distributed in rural and urban areas. The non-RDF health facilities (control group) included the biggest referral hospital in the Sudan and one rural health centre.

Ethical considerations

Before starting the data collection, ethical clearance was obtained from the Ministry of Health research ethics committee. Permission was sought from interviewees for their participation.

The interviews with the policy-makers and practitioners revealed that the RDF is responsible for maintaining a regular supply of medicines in its health facilities compared with non-RDF ones. The health facilities survey showed that, from a total of 48 respondents who visited RDF health facilities, almost 85% bought their drugs from the RDF pharmacy. Only 8% failed to fill their prescription using RDF because the medicines were not available. The average availability rate of key items, which were determined before the fieldwork, was greater (97%) in the RDF facilities than in non-RDF facilities (86%).

The RDF has strongly improved geographical equity of access to medicines. It has expanded from a project designed to supply only 60 health centres to an independent foundation responsible for the distribution of pharmaceutical products to almost all Ministry of Health facilities in Khartoum state. Our quantitative findings revealed that most of the sampled households were located > 5 km from the nearest RDF facility. As a result, the RDF has met the recommended goal of treating 5.9 million patients in the past 2 years. The RDF medicines were usually considered affordable by users. The average cost of a prescription (3.01 Sudanese pounds) at the RDF facilities amounted to only 2% of the lowest monthly government salary.

This evaluation identified some areas of weaknesses that still need to be considered to ensure the RDF’s sustainability. This study showed that 6% of prescriptions presented to selected RDF health facilities were not dispensed for financial reasons. The RDF also failed to extend access in geographical terms: 26% of health centres and 200 dispensaries in rural areas in Khartoum state still do not have the RDF. Administrators of RDF health facilities or neighbourhood health committees have no role in the financial management of the RDF at their facilities.

Several lessons have been learned from the experience in Khartoum state ( Table 1 ). These lessons were distilled from interviews with policy-makers in considering the factors that often cause RDFs to fail to generate sufficient revenues to replenish their stocks and, in effect, to revolve. 1

RDF, revolving drug fund.

It took 4 years of preparation by Save the Children (United Kingdom) and the Ministry of Health before the RDF was introduced in late 1989. Given the time required to implement the RDF, it is clear that the experience and logistic input of Save the Children (United Kingdom) was of paramount importance. It is therefore essential that the cooperation of international nongovernmental organizations should not be underestimated in the development of RDF programmes.

Substantial investment by Save the Children (United Kingdom) has enabled the RDF to achieve its goals. According to its obligations set out in the agreement with the government, Save the Children (United Kingdom) provided the capital seed stock of medicines that helped the RDF to absorb its first huge loss (46% of the invested capital) that occurred as a result of local currency liberalization in 1992.

Political commitment allowed the RDF to have a separate account so that its managers have a free hand in keeping generated revenues out of public treasury regulation. Therefore one of the important lessons to be learned from the RDF in Khartoum state is that revenues generated from medicine sales should be kept in the RDF and entirely excluded from the Ministry of Finance budget. The RDF also enjoys the benefits of a strong political commitment in terms of tax exemption and import licence exemption.

This study reveals that applying a commercial style of business management, such as on employment contracts, was not only possible and accepted within a public sector setting, but resulted in control over operations and reduction of risk. These measures also resulted in preserving the entity of the RDF. In addition, the RDF needs to recruit staff with expertise in finance, accountancy and private sector experience. This enables the RDF to establish a profit and loss account on a commercial basis.

The Currency Swap Agreement signed between the Government of Sudan and Save the Children (United Kingdom) enabled the RDF to have access to hard currency at official rates. The lesson to be learned is that donors and development organizations wishing to set up effective RDFs may need to be innovative in responding to constraints that might arise. Access to foreign currency is one such constraint. However, by setting up this currency swap mechanism, to which both the government of Sudan and Save the Children (United Kingdom) were committed, the constraint was overcome.

To ensure the RDF’s success, reliable sources of quality medicines must be identified. The drug procurement strategy was based on the annual purchase of a large quantity of drugs and on responding to situations of stock-out and emergencies. All RDF facilities receive their medicines regardless of their ability to make a payment at the time of ordering. This policy ensured that no health facility operated without medicines. In the RDF pharmacies, medicines are dispensed with cash payments only with no exemption allowed.

To make medicines affordable, their cost has to be subsidized through the sale of cheaper drugs on the RDF list. To cover the potential loss, and to generate more funds for the continued supply of the expensive drugs, the cost of the cheaper medicines was always kept as low as possible to maintain their high turnover. The centralized system has enabled the RDF to have a standardized medicine list for each level, bulk purchase for more than 130 health facilities and a uniform price system.

Monitoring, evaluation and reporting on project activities at the RDF facilities have been performed by supervision teams in accordance with a stated list of performance targets. The supervision teams also move medicines that are nearing their expiry date from over-stocked facilities to under-stocked ones. In addition, the supervision teams collect revenue and monitor the financial status of each RDF pharmacy.

The increased use of RDF health centres suggests that people are prepared to go to a local health centre rather than to referral hospitals provided that medicines are available there. The lesson to be learned is that introducing a RDF to enhance the utilization of cost-effective primary health care facilities requires concomitant improvement in the quality of health care provided at these facilities. In addition, community acceptance increases medicine sales and, consequently, the ability of the RDF to replenish used stocks and to meet its operating expenses.

The RDF in Khartoum state has fulfilled its original mandate and could be successfully replicated in other states of the Sudan and in countries with similar contexts. The success factors reported in this evaluation are necessary to secure survival of the RDF. ■

Acknowledgements

Thank you to Professor Chris Bellamy and Dr Matt Henn.

Competing interests: None declared.

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Drug Revolving Fund established

The Drug Revolving System is a concept that promotes access, ensures availability and affordability of drugs. . The drugs revolving system guarantees the sustainability of drugs supplies and services. Before MNCH2, the State had 617 DRF facilities. This has increased to 744 health facilities. MNCH2 revitalised the initiative by ensuring full institutionalisation of the system and ensuring accountability of the Drug Revolving Fund (DRF) system. The DRF scheme is also linked with the community voice and accountability mechanisms (using Facility Health Committees / Hospital friends) to ensure responsiveness. Similarly, in February 2016; the DRF Scheme was integrated with the free drug supply chain systems to foster accountability and synergy.

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Set up Facility Health Committee (FHC) LGA and State Alliances

Re-activation of Primary Health Care Under One Roof (PHCUOR)

 Establishment of Logistics Management and Coordination Unit (LMCU)

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