Abstract
The global demand for artemisinin-based combination therapy (ACT) has grown sharply since its recommendation by the World Health Organization in 2002. However, a combination of financing and programmatic uncertainties, limited suppliers of finished products, information opacity across the different tiers in the supply chain, and widespread fluctuations in raw material prices have together contributed to a market fraught with demand and supply uncertainties and price volatility. Various short-term solutions have been deployed to alleviate supply shortages caused by these challenges; however, new mechanisms are required to build resilience into the supply chain. This review concludes that a mix of strategies is required to stabilize the artemisinin and ACT market. First, better and more effective pooling of demand and supply risks and better contracting to allow risk sharing among the stakeholders are needed. Physical and financial buffer stocks will enable better matching of demand and supply in the short and medium term. Secondly, physical buffers will allow stable supplies when there are procurement and supply management challenges while financial buffer funds will address issues around funding disruptions. Finally, in the medium to long term, significant investments in country level system strengthening will be required to minimize national level demand uncertainties. In addition a voluntary standard for extractors to ensure appropriate purchasing and sales practices as well as minimum quality and ethical standards could help stabilize the artemisinin market in the long term.
Highlights
Since artemisinin-based combination therapy (ACT) was recommended as the first-line treatment of uncomplicated malaria in April 2002 by the World Health Organization (WHO), demand for it has grown sharply [1]
The current limitations on available information about future funding for ACT impede their ability to improve the accuracy of forecasts far enough in advance to benefit those stakeholders in the supply chain that need them
Accurate forecasting information from the country level will enable a closer matching of global demand and supply; this will require significant investments in national health system strengthening which are unlikely in the short-term
Summary
Since artemisinin-based combination therapy (ACT) was recommended as the first-line treatment of uncomplicated malaria in April 2002 by the World Health Organization (WHO), demand for it has grown sharply [1]. A regionally located inventory can result in lower transport costs and lead to better preparedness for any time-sensitive, short-term demand spikes that may require more than one supply source, such as a malaria epidemic Such stockpiles and buffers have been successfully used by PEPFAR/SCMS [46,47,48] for HIV medicines, PMI for ACT [49], the Global Drug Facility (GDF) for Multi Drug Resistant Tuberculosis (MDR-TB) medicines [50] and UNICEF for multiple vaccines [43,44,45]. Large purchasers such as PMI and Global Fund would ensure that ACT manufacturers from whom they purchase source their artemisinin only from extractors who have opted to meet the voluntary quality standard This standard would reduce the number of participating extractors and in turn simplify the API supply chain and result in fewer, and more responsible, extractors that meet standards of product quality as well as better selling and pricing practices [12]. Such methods of providing better demand and price information to farmers have been commonly used to eliminate middle-men and stabilize prices in other agricultural sourcing markets including the ITC e-Choupal programme [53]
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