Strong supply chains are essential to effective health care delivery and form the backbone of a country’s health system. In Organization for Economic Cooperation and Development (OECD) countries, health product supply chains are largely market-oriented, including countries which have a health system that is largely or exclusively publicly funded and operated. Supply chains for health products are complex everywhere. More stakeholders, greater public scrutiny and need for equity mean that no health product supply chain is perfect. With the exception of stockouts more recently, supply chains in OECD countries work reasonably well in ensuring consistent availability of high-quality medicines and other health products. In contrast, health supply chains in most low- and middle-income countries are fraught with persistent problems of poor availability and stock-outs. Improving health product supply chains has now become an important component of development assistance for health, and discussions abound regarding the use of market-oriented organizational forms versus state ownership of health product supply chains.
As part of the William Davidson Institute’s celebration of 25 years of market-based solutions, this
paper reviews the changes that have taken place in health care supply chains in low- and middleincome countries over the years, with an emphasis on the role of market-based solutions.
This paper has two objectives: (1) to provide an understanding of the evolution of health product supply chains in developing countries over the last 25 years, and (2) to highlight areas where marketoriented reforms have succeeded or failed in improving supply chain performance. It is based on a review of peer-reviewed and policy/practitioner literature on health product supply chains.
