Overview of UNICEF procurement of

Safe Injection Equipment

Safe Injection Equipment

Industry Consultation

21st – 22nd April 2015

Rob Matthews, HTC

Objective of Session

• Provide an overview of UNICEFs engagement in Safe Injection Equipment (SIE) procurement

• Strengths and Challenges faced

• Share Findings from Analysis undertaken

Source: UNIICEF Supply Division

Immunization Supplies

Vaccines

Safe Injection Equipment

Cold Chain Equipment

Safe Injection Supplies: US$ 42.2 million907

Million Pieces

doses

1320

Transactions2014

Countries UNICEF

procures Injection devices

on behalf of:

Full schedule

Partial schedule

Source UNICEF Supply Division

613

Shipments

UNICEF has a key role in Immunization procurement, including Vaccines, Safe Injection Equipment and Cold Chain Equipment; procuring immunization supplies on behalf of around 100 countries annually

Scope of Activities covered

Commercial

• Responsible for the supply operation including

strategic market intelligence, forecasting,

procurement, delivery, innovation and analysis of

product groups and procurement strategies

• Ensure on-time delivery and operational efficiency

• Collaborate with partners to increase access,

decrease prices, establish a healthy, competitive

supplier base and sustainable supply, including

that can be accessed by government buyers

• Ensure appropriate Emergency Response

• Support optimization projects

• Support knowledge sharing via communication

pieces on key products/markets and publication

of information

• Achieve targeted supply outcomes for relevant

result areas

Technical

• Quality Assurance

• Technical oversight and review

• Provision technical assistance and knowledge management

• Responsible for ensuring expertise on products

• Complaints Handling

• Support knowledge sharing via communication pieces on key products/markets and publication of information

• Product performance assessments

• Product Innovation

• Product Pipeline

• Engagement with Technical Partners

Safe Injection Equipment – UNICEF Product Scope

Contributing Directly to 2 MTSP Result Areas

Result 1: Survival during delivery and the neonatal period and living free from preventable diseases and disability;

Result 2: Protected from HIV infection and free from AIDS.

Commodity Overview

5 Commodity Groupings Programme Focus Areas Usage/ Application Product Strategic Profiling

Auto-Disable (AD) Syringes Immunization Injection for Immunization 29 Standard Stock Materials

All considered Strategic due to their role in

Immunization and Emergency response and

UNICEF’s role in the market

Primary Demand Immunization (>90%); Curative

Demand principally for Kits

Safety Boxes Immunization & Curative Safe Disposal of Syringes

Disposable Syringes Immunization & CurativeReconstitution of Vaccines; As

part of Health KitsRe-Use Prevention (RUP)

SyringesImmunization & Curative

Needles Curative Health Kits

Immunization Devices – UNICEF Product Scope

Injection Devices Supply Overview

What’s Good What’s Challenging

• Positive Market

developments

• Supply base for Injection

Devices is good*

• 5 year shelf life

• Comparative cost (to

vaccines)

• 0.5ml AD syringe used for

multiple vaccines

• Opportunities to improve

delivery efficiency

• Engaged Partners and

established partner forums

• Geographically spread supply base

• Sea Shipment lead times (2-4 months)

• Timely Funds Availability

• Poor Forecast Accuracy*, particularly for

supplementary activities

• Focus on Vaccines, not Injection Devices

• Large storage capacity required

• Demand driven by multiple vaccines &

programmes

• Technically acceptable supplier base for Safety

Boxes

• Price levels for RUP and SIP featured Syringes

• Bundled deliveries of all safe injection materials

• Effective Waste Management remains an

unsolved issue

Immunization – frequently cited as the most cost effective health intervention…..

• 32% of child mortality is from vaccine preventable diseases…

• Where safe injection equipment plays a key role

Procurement Value 2013

Procurement Volume 2013 Average shipment time excl. Order LT and FFwdr 2013 (Days)

No of Shipments 2013

Product Diversity within the Immunization Context

Profile Vaccines Injection Devices

Product profile Biological Plastics

Quality Assurance WHO PQ, GMP, Batch Release WHO PQS, UNICEF Tech. Assessment, Field Test, Inspection

Production Lead time 6-24 months 2-4 weeks

Storage requirements Temp controlled (Cold Chain) Dry Stores

Supply Base Restricted Healthy (Ability to respond dependent on forecast accuracy)

Shelf life 2 years 5 Years

Shipment Mode Air Sea

Influencing Markets

• AD Syringes– Reduction in the WAP (>10%), estimated savings >$5m for tender

period (2014-2015)– Implementation of Landed cost evaluation– Quality Assured supply base– Healthier market, 4 suppliers, more balanced– Injection Safety

• Programmatic Preference for disabling technology implemented on activation of Device

– Focus on Sustainability• All 0.5ml suppliers contracted > 1,3m pieces per 40’ Container

(Offers rcvd: 500k – 1.8m)

• Safety Boxes– Reduction in the WAP in prior tender round (>10%), estimated

savings >$500,000 for tender period– Implementation of Landed cost evaluation– Quality Assured supply base– Healthier market challenged by technically acceptable supplier

base

• Reconstitution Syringes– Demand moving towards Re-Use Prevention (RUP) syringes,

principally funded by GAVI, not countries– Pricing of RUP and RUP with SIP (stick-injury protection) remains a

barrier– WHO Policy issued for use of RUP and SIP featured syringes for

therapeutic markets– Manage the transition from Disposable to RUPs for Reconstitution

• Disposable Syringes and Needles– Highly volatile demand profile due to emergency response

AD Syringe Volumes and WAP 2005 - 2014

Safety Box Volumes and WAP 2005 - 2014

Disposable and RUP Volumes and WAP 2005 - 2014

5ml Reconstitution Syringe Volumes and WAP 2005 -2014

Needles Volumes and WAP 2005 - 2014

Value of UNICEF SIE procurement 2005 - 2014

2005

Joint UNICEF, WHO, UNFPA

Policy Issued

Auto-Disable (AD) as a step-

stage technology (added

attribute to already established

technology)

1999

AD @ start

RUP

SB

AD

RUP/SIP

UNICEF Expressed preference for

early activation of the disabling

mechanism (to reduce risk of reuse)

leading to redefining technology and

improve product design

AD

AD @ start

2009 Adequate Supply

Available with

preferred AD

mechanism for full

award - with multiple

suppliers

2008

Introducing the RUP &

RUP/SIP feature for

reconstitution of freeze

dried vaccines

RUP/SIP

RUP

2015

Introducing the RUP &

RUP/SIP in therapeutic

injections- WHO Policy

issued in Feb 2015

Needle-free

devices

NEW

Safe Injection Device Development and Innovation

Service Delivery

Opportunity for Efficiencies,

expansion, refinement

Key Success factor, critical

management and monitoring

The Dream The Reality

The Dream The Reality

The ordering process by design creates an increasing number of activities

Country Example

Service Delivery: ensuring focus on the whole supply chain, engaging all Stakeholders

Throughout the process collaborative planning is key:Campaign Safe Injection Equipment order timelines

• Scheduled Campaign date January 2015; Devices indicated to arrive in February 2015

• Orders driven by funds release, not program needs and realistic lead times

• Reprioritising orders of routine orders impacts other countries supplies – where planning was adequate

• Alternative remedies sought - Potential use of local stock to be investigated

• Risk of poor results, delayed campaigns which could be avoidable through better planning; earlier funding

• Increased Advocacy with key stakeholders required

2014: Changed operating approach to consolidate GAVI shipments (50% of total orders)

Country Example

Opportunities for Supply Chain improvement initiatives

UPDATE

Procurement development over the past 5 years

GAVI playing an increasing role

Consolidation of shipments shows a reduction in Shipments, most notably for GAVI

Savings gained in the last tender round reflected in the Value/ Volume statistics

Data Source: UNICEF SD ZSOS based on PO Year – covering all IID products

LTA Supply Base

AD Syringes

Reconstitution

Syringes

AD and Reconstitution

Syringes

Safety Boxes

AD and Recon

Syringes and

Safety Boxes

Demand Profile by

Region

Shown as a

Percentage of

total UNICEF

demand by

UNICEF Region

40%

7%

26%3%

2%

13%

Source: UNICEF SD PO quantities by region 2010- 2014

XX

%

9%

Supply and Demand Mapping of AD Syringes; Safety Boxes; Reconstitution Syringes

Analysis of Sea shipment lead times for Injection Devices over a 4 year period (2010 - 2013)

A wide range of transit times, depending on source and consignee country with an average of 43 days and a standard deviation of 24 days.

Freight Forwarder lead times for securing shipments is 14 days.

Supplier lead times vary from 10 – 30 days for forecast demand following placement of the order, depending both on the supplier and the order volumes.

Using a 20 day order lead time, 14 freight planning, 43+24 shipment transit time - assuming no delays, and not considering customs clearance and in country distribution requirements gives a lead time of : 20 + 14 + 43 + 24 = 98 days

Country Specific Shipment Lead times

Products are sourced Globally

Order lead times are supplier specific

Shipment lead times are supplier –consignee specific

Safe injection Equipment is sourced globally by product and often not consolidated across products before shipment, unless shipped from SD Warehouse or suppliers contracted for multiple products

Supply Chain strengthening through collaborative planning

Myanmar MR Campaign. Target Population17.5mLogistics challenge: Insufficient warehousing capacity for dry stock; Bottleneck at Central level

Solution: Share regional distribution plans before order placement; Procure containers; Pack for direct regional distribution; Combine all devices (AD’s Recon syringes, Safety Boxes) at central level for onward distribution

Enabler: Early planning and Funding, Collaboration across stakeholders along the supply chain

Changing Focus - Engaging partners along the supply chain to address challenges and country constraints

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Developing synergies improving the overall performance of the supply chain

SCSC

Supply Chain improvement initiativesStructured framework and iterative approach for Forecast Improvement

Prioritize & Identify Key

Drivers

Engage Stakeholders

Structured Empirical

Methodology

Adjust & Develop Forecast

Methodology

Undertake Forecast Exercise

Monitor Forecast Accuracy

Analyze

Identify causes of variance/ volatility

Identify & Implement Corrective

Action

IMPROVEMENT

Past 3 years forecast accuracy > 20% variance

Reviewed Forecast approach for Injection Devices

Performance Monitoring On Time Arrival

Performance Monitoring On Supplier performance

Emergency Response

• Emergency response provisions in established LTAs

• Stocks in Copenhagen warehouse for emergency response

• Forecasting and Warehouse replenishment for emergency demand challenging – identified risk area

2014 Performance

9 of 40 Emergency response lines

late

6 shipments, All ex-warehouse,

Due to consolidation and closed

borders (CAR)

2015 UNICEF Supply Focus Areas

Engage Key Countries, Donors and Industry to address Supply related issues – along the whole supply chain

• Key Countries – Work together to Improve forecast accuracy

• Key Donors – Leveraging funds – early order placement; improve contractual terms

• Industry – Engage industry in addressing challenges, improving program results

• UNICEF Supply Division – Develop a Procurement Strategy to address program needs

• Opportunities for improving operational efficiency

• Leverage Partnerships