Vendor Managed Inventory Ensures Continuous Supply of Critical HIV Commodities in Malawi

Sub Title
How Malawi's coalition of health partners used a responsive, data-based approach to rapidly address a national shortfall of HIV prevention supplies
Related Supply Chain Topics
Related Global Health Areas
March 21, 2019
Lead Paragraph/Summary

In June 2018, the USAID Global Health Supply Chain Program-Procurement and Supply Management (GHSC-PSM) project in Malawi received an urgent request for Voluntary Medical Male Circumcision (VMMC) kits. The request came less than a month before Malawi’s winter VMMC campaign, when demand for these commodities is at its peak. This annual campaign supporting HIV prevention takes place from July-September, during which up to 40 percent of all VMMC procedures for the year occur. While preparing for the campaign, Malawi’s coalition of VMMC implementing partners and international donors such as USAID, the U.S. Centers for Disease Control and Prevention (CDC) and the U.S. Department of Defense (DOD) assessed VMMC stock levels and found them to be insufficient—108,000 additional kits were needed.

With procurement support from GHSC-PSM, Malawi received the large quantity of kits they required to raise stock levels in time to meet the demands of the campaign. The first order arrived just six weeks after the initial emergency request. The project also used data to manage kit allocation, supporting the USAID/Malawi Mission to make informed decisions on how many kits and how often to allocate to each implementing partner.

A standard procurement of this magnitude is estimated to take upwards of 7 months. However, GHSC-PSM had recently introduced new vendor managed inventory (VMI) service agreements with two manufacturers of VMMC kits. Under VMI, vendors agree to carry a balance of ready-to-be-administered VMMC kits, available any time upon request, solely to GHSC-PSM. The inventory can address urgent needs and is guaranteed to be shipped within 8-10 business days from vendor warehouses to any of GHSC-PSM’s VMMC implementing countries.

VMI ensured that enough kits were available to rapidly meet Malawi’s needs, demonstrating flexibility and responsiveness in the supply chain. GHSC-PSM responded to the emergency request and delivered 18,321 kits within six weeks. Two additional shipments were made in the following weeks, covering not only the campaign’s demand, but also the country’s VMMC needs for the first quarter of fiscal year 2019.

The procurement process also allowed GHSC-PSM to build rapport and improve communication and information-sharing with VMMC health supply chain implementing partners in Malawi. The project continues to work closely with its partners and vendors to implement VMI and other creative approaches to ensure continuous reliable supply of health commodities, innovate the supply chain and effectively reach those in need across the globe.