Stakeholder perspectives on the challenges surrounding management and supply of essential medicines
Publication | Update:
Background Shortages of essential medicines impact patient safety and raise the costs of medicines to consumers and governments. Ongoing medicine shortages have become a critical issue that threaten global access to medicines. Objective The aim of this study was to explore key stakeholders’ perspectives on the challenges surrounding management and supply of essential medicines. Setting Western Pacific, Asia, Europe, North America, and Africa. Methods In-depth, semi-structured interviews with 47 participants were conducted across seven stakeholder groups globally. Stakeholders included government, academics, consumer groups, non-profit organisations, hospital healthcare providers, manufacturers, and wholesaler/distributors. A grounded theory approach was applied to qualitative analysis. Main outcome measure Stakeholders’ perspectives on the challenges surrounding management and supply of essential medicines. Results This study showed that supporting consumer demand for a wide range of therapeutic products required increased resources and coordination. Four main themes were identified: (1) consumer demand for a wide range of individual therapeutic needs cannot be sustained by the supply chain; (2) there lacked a coordinated approach to manage medicine shortages throughout the supply chain; (3) there were gaps in communication throughout the continuum of the supply chain; and (4) both international and local disruptions contributed to vulnerabilities in the supply chain. Conclusion Prioritisation of supply, logistics, and budget decisions around essential medicines need to be clearly coordinated between stakeholders to mitigate medicine shortages. Financial structures should include resilience planning to support fair and equitable access to medicines that meet consumer needs.
Objectives and Study Scope
This study has assimilated knowledge and insight from business and subject-matter experts, and from a broad spectrum of market initiatives. Building on this research, the objectives of this market research report is to provide actionable intelligence on opportunities alongside the market size of various segments, as well as fact-based information on key factors influencing the market- growth drivers, industry-specific challenges and other critical issues in terms of detailed analysis and impact.
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Research Process & Methodology
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Historical, qualitative and quantitative information is obtained principally from confidential and proprietary sources, professional network, annual reports, investor relationship presentations, and expert interviews, about key factors, such as recent trends in industry performance and identify factors underlying those trends - drivers, restraints, opportunities, and challenges influencing the growth of the market, for both, the supply and demand sides.
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Market phase is determined using factors in the Industry Life Cycle model. The adapted market phase definitions are as follows:
The Global Economic Model
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The model is a hybrid statistical model that uses macroeconomic variables and inter-industry linkages to forecast sectoral output. The model is used to forecast not just output, but prices, wages, employment and investment. The principal variables driving the industry model are the components of final demand, which directly or indirectly determine the demand facing each industry. However, other macroeconomic assumptions — in particular exchange rates, as well as world commodity prices — also enter into the equation, as well as other industry specific factors that have been or are expected to impact.
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The principal explanatory variable in each industry’s output equation is the Total Demand variable, encompassing exogenous macroeconomic assumptions, consumer spending and investment, and intermediate demand for goods and services by sectors of the economy for use as inputs in the production of their own goods and services.
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Demand elasticities can be influenced by several factors. Each of these factors, along with the specific characteristics of the product, will interact to determine its overall responsiveness of demand to changes in prices and incomes.
The individual characteristics of a good or service will have an impact, but there are also a number of general factors that will typically affect the sensitivity of demand, such as the availability of substitutes, whereby the elasticity is typically higher the greater the number of available substitutes, as consumers can easily switch between different products.
The degree of necessity. Luxury products and habit forming ones, typically have a higher elasticity.
Proportion of the budget consumed by the item. Products that consume a large portion of the consumer’s budget tend to have greater elasticity.
Elasticities tend to be greater over the long run because consumers have more time to adjust their behaviour.
Finally, if the product or service is an input into a final product then the price elasticity will depend on the price elasticity of the final product, its cost share in the production costs, and the availability of substitutes for that good or service.
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