Background

In 2001, following the creation of the country’s Social Security System, the Dominican Republic began a major health system modernization and reform. The core elements of the reform focused on separating the national health system’s central functions - oversight, insurance, procurement, and financing - and reorganizing the system around functional decentralization of administration. Meanwhile, the country’s health system experienced frequent drug and supply stock-outs, parallel procurement processes due to multiple “vertical” systems of supply chain management, and overall poor planning. Specifically, while a central medical store, Programa de Medicamentos Esenciales/Central de Apoyo Logístico (Program for Essential Medicines/Central Logistics Support [PROMESE/CAL]), oversaw procurement of bulk quantities of generic categories of goods, there were other programs and health facilities that also procured health commodities at hugely inflated purchase prices, far more than what PROMESE/CAL was paying. ² From the outset of the health system reform, there was a proposal for the integration of the pharmaceutical supply, but this did not materialize until 2008, when a study by USAID found that system fragmentation contributed to stock-outs and to losses from expired products. The Ministry of Public Health was catalyzed to create a single supply management system that would address the fragmentation, inefficiency, and inequality in medical drugs and supplies. ¹

Innovation

In 2010, the formal proposal for the Ministry to organize this integrated, single supply system was endorsed. The system was named Single System for Managing Medicines and Medical Supplies (SUGEMI, in Spanish). Before implementation of SUGEMI, supply chains in the Dominican Republic were inefficient due to (a) the overall inefficiency of the system as a result of  fragmented purchasing; (b) the use of multiple fleets of vehicles traveling to the same destinations; and (c) the existence of separate warehouses, inventory management systems, dispatch, and requisitions for each Disease Control Program (DCP). ¹

System efficiency was created by transferring certain distribution chain components to specialized units of SUGEMI (such as the National Pharmaceutical Supply Management Unit, or UNGM in Spanish) and keeping selection and use coordination components with each individual DCP. More specifically, this meant decisions about which products and quantities to procure remained with the Regional Health Service Centers and Disease Control Programs, and the procurement itself was managed by this central SUGEMI system. ¹ This system change effectively decentralized responsibility for supply selection to ensure local knowledge and needs could be taken into account while centralizing bulk procurement - where local knowledge is less helpful - to simplify logistics and reduce costs. The newly created UNGM developed standard operating procedures for all components of the supply chain management system. For example, SUGEMI and UNGM have an annual purchasing planning meeting, a collaborative activity that involves reviewing epidemiological data provided by DCPs. ¹

With the integration of the DCPs into SUGEMI, the multiple vertical manual and electronic information systems have been eliminated and replaced with a unified electronic system. Efficiency has been improved in other ways as well, such as: streamlining medicine delivery to include multiple medicines in each re-supply; the simplification of requests for dispatch to just a single form; special staff designation for pharmaceutical management; and consolidation of medical warehouses into larger, more equipped facilities with robust inventory management. Each of these strategies saves time and resources. ¹

Outcome

The integrated SUGEMI approach helped surface a number of deficiencies in the system and created strategies to promote efficiency and equality in the pharmaceutical supply chain management and the Dominican health system overall. As a result of SUGEMI, the Dominican Republic has decreased the frequency of stock-outs and waste of unused, expired commodities and has decreased overall purchasing prices for these drugs and supplies. This approach in the Dominican Republic demonstrates the value of integrating individual DCPs (e.g. malaria, tuberculosis, HIV/AIDS) into a single supply system, a priority task for contributing to the integration of the health services systems overall. ¹