Quantification

Quantification is the process of estimating quantities and costs of medicines and health products required for a specific period and determining when shipments of the products should be delivered to ensure optimal and uninterrupted supply.

Quantification has multiple aspects including:

  • Calculating estimated order quantities, costs, and shipment delivery dates
  • Planning, mobilizing, and securing financial resources
  • Estimating storage needs
  • Assessing rational use of commodities
  • Facilitating procurement and logistics coordination with donors, suppliers, health facilities, and other stakeholders
  • Informing manufacturers and suppliers on future demand for manufacturing, procurement and logistics management decisions

Accurate quantification of pharmaceutical requirements is essential for effective procurement, efficient stock management, and rational use of medicines. But accurate quantification can be difficult if there is a lack of reliable data, weak coordination among stakeholders, lack of defined roles, and limited ability to update and monitor forecasts and supply plans.

SIAPS includes both forecasting and supply planning in our quantification activities.

  • Forecasting: The process of estimating the quantities and costs of products required to meet demand during a particular time frame. It uses consumption, service, demographic, and morbidity data, including assumptions on programmatic scale-up, service capacity, and related factors for estimating the requirements.
  • Supply planning: The process of determining which health products should be procured, the amount to be procured, the time at which they should be delivered, and the financial costs to be incurred. It requires data on forecasted amounts, stock on hand, stock on order, lead times, expiry dates, freight and logistics costs, unit costs, and minimum and maximum stock levels to estimate the requirements. These plans are part of continuous process used to inform high-level decision making on health products, financing, procurement and logistics.[1]

SIAPS helps partners and in-country stakeholders build their capacity to conduct efficient forecasting and supply planning exercises. We also work to set up coordination mechanisms such as quantification committees or logistics management units to oversee the quantification process. These mechanisms serve as platforms where relevant stakeholders, donors, and partners meet regularly to review forecasts, supply plans, current funding levels, and stock status reports and then make informed decisions that ensure continuous availability of products. SIAPS also works with stakeholders to determine funding gaps and align resources for meeting procurement costs of medicines and other health products, and for strengthening information management systems.

We provide governments and other implementing partners with training, mentoring, and supportive supervision to assist with the implementation of guidelines and tools including Quantimed®, QuanTB®, Reality√® and PipeLine®, which help ensure effective forecasting and supply planning.

As a result of SIAPS assistance, availability of commodities has improved in a number of SIAPS-supported countries improvements to inventory control, better tracking of product expiration dates, and optimized redistribution mechanisms. The Philippines, for example, experienced zero stock-outs of tuberculosis (TB) medicines in the third quarter of 2014, and in Lesotho only 1% of health facilities had stock-outs in the fourth quarter of 2014.

In Swaziland, SIAPS is helping the Ministry of Health strengthen quantification and procurement systems by conducting annual forecasting and quarterly supply planning revisions for HIV, TB, and reproductive health commodities, along with laboratory supplies. This support has directly translated into cost savings, cutting expenditures in 2012 by 6.4% for HIV commodities and 69.2% for family planning commodities due to the cancellation of unnecessary procurements.

In Bangladesh, the National TB Program and Family Planning Program saved a total of USD 5.9 million in 2014 through regular quantification revisions and improved planning.

 

[1] Logistics functions include warehousing, inventory management, and transportation.