A private sector approach creates a quickly scalable solution for public healthcare in Mozambique

Without effective and efficient logistics and distribution of medical goods and services, it is difficult for people to access life-saving medicines and healthcare when and where they need them. Project Last Mile is part of an initiative in Mozambique to bolster medicine distribution in the country. One of the project’s most successful aspects has been its ability to scale its solution: the model went from a small pilot in Tete in 2018 to national coverage in just three years.

The project focused primarily on outsourcing the distribution of medicines at the primary and secondary levels. It forms part of the more extensive scope of work that has been underway in Mozambique since 2016. This work is a partnership between Mozambique’s Central de Medicamentos e Artigos Médicos (CMAM), The Global Fund to Fight AIDS, Tuberculosis, and Malaria, and several other stakeholders, including Project Last Mile, to expand and implement CMAM’s Strategic Plan for Pharmaceutical Logistics (PELF).

In the pilot and scaled model led by VillageReach, the distribution of medical supplies was outsourced from a service directly provided by the Mozambican government to one contracted out to the private sector. Project Last Mile provided strategic input on outsourced distribution, which enabled key stakeholders to make informed decisions at the beginning of this project. It was not directly involved in implementing or rolling out pilots or operations.

Courageous decisions by policymakers

The courageous decisions made by policymakers in Mozambique significantly influenced the successful implementation and scaling of outsourced distribution. These decisions included transitioning from a government-provided service model to a private sector outsourced model for the distribution of medical supplies. This shift required a substantial leap of faith and a departure from traditional methods, driven by the need to improve efficiency and reach in the healthcare system.

For instance, the policymakers’ decision to tap into private sector expertise through Project Last Mile exemplified a forward-thinking approach. They recognized the potential benefits of integrating private sector logistics expertise into public healthcare. As a result, Project Last Mile provided key stakeholders with invaluable insights and direction across several critical areas:

• Templates and guidance: Developed templates and guidance on contracting with service providers for outsourced distribution based on The Coca-Cola System best practices. This support was instrumental in drafting the first service-level agreements between VillageReach and third-party logistics providers.
• Network and route optimization: Conducted thorough network and route optimization analyses, providing insights into time, resource, and cost benchmarks essential for the transition to outsourced distribution. This included planning, implementation, contracting, and performance management with service providers.
• Advocacy and case building: Supported CMAM and other stakeholders in the early stages by building a compelling case for change. This involved developing case studies and quantifying the expected benefits of changes like outsourced distribution.

Route optimization to scale the distribution of medical supplies

As part of the foundational work that underpinned the development and implementation of this solution, Project Last Mile assisted with the route optimization component, drawing on expertise derived from The Coca-Cola System.

This route optimization project involved two main activities. The first was collecting and validating data across 10 of Mozambique’s 11 provinces to enhance the accuracy and reliability of the route optimization work. The second activity was conducting a route optimization analysis to better understand the time, resources, and cost required for the existing supply chain network compared to the proposed intermediary supply chain network.

Combined with evidence about the medical supply demands gathered from every health facility, this allowed Project Last Mile to advise CMAM on validating the location and health facility information to build an accurate health facility database for accurate route optimization.

Road network model for the wet and dry seasons

The terrain in Mozambique shifts significantly during different times of the year. To address this, Project Last Mile built an improved, bespoke, routable road network model for both the wet and dry seasons to run accurate, reliable time and distance calculations between all storage and delivery points. This included adding missing roads and adjusting the travel speeds on the original road network, which was used for route optimization in all provinces.

With this, Project Last Mile provided insights into the required number of delivery routes, vehicles, delivery days, overnight stops, and expected costs per delivery window.

This analysis helped to quantify the required resources and cost of distribution (insourced and outsourced) for the existing and proposed models and was used to build a case for change for the PELF.

Positive outcomes and impact on healthcare

Lucrécia Venâncio Mateus, head of the Department for Monitoring & Evaluation at CMAM, said: “The initiatives provide CMAM with a unique opportunity to strengthen operational efficiency by optimizing transport routes for medicine and health product distribution and strengthening financial information systems, logistics, and human resources. This allows for better visibility of management information and accountability. These positive outcomes will have a major impact on health service provision to the population.”

The innovation demonstrates how private sector methods and best practices can enhance the healthcare industry by adapting the knowledge, tools, and processes used by organizations like The Coca-Cola System and other fast-moving consumer goods companies to the current reality and requirements. Innovating in this way keeps the patient at the center while being mindful of the environment in which the health sector operates. It validates the courageous decision made by government policymakers in Mozambique to initiate this change and follow through with its implementation. Furthermore, it strongly supports the operationalization of medical supply logistics managed outside the government, inspired by private sector outsourced distribution models. This presents an approach that other countries in Africa can emulate.

You can read the entire case study by the SDG3 Global Council on ways and means of addressing structural constraints to scaling innovation in African primary healthcare systems, with a focus on last mile service delivery, here.