What Is The Purpose Of Doing Demand Forecasting?

“Improved supply chains and demand forecasting is
essential to ensure that life saving drugs reach patients in need. The
new Artemisinin-based combination therapies (ACTs) provide a unique
opportunity to tackle unacceptable burden of malaria. In order to
manage risks and opportunities, manufacturers, procurement agencies and
donors need clarity in the medium term needs for these drugs. This
report provides a significant contribution to understanding and
mitigating the risks related to demand forecasting.”

  Dr Christopher Hentschel, President and CEO, Medicines for Malaria Venture
The dynamic of the antimalarials market has changed
significantly since the advent and scale up of ACTs in many African
countries. The issue is no longer to find a highly effective medicine,
but to ensure that these new medicines reach those who need them.
Many countries have focused initially on access through
the public sector. However, even in this environment, the challenges of
ensuring supply chain management and appropriate demand forecasting
have been significant.
These challenges will further increase as ACTs become
more widely available in the private sector - possibly with the arrival
of the proposed Affordable Medicines Facility, malaria, derived from
the Institute of Medicine’s report ‘Buying Time, Saving Lives’
Understanding the scale up in demand, and therefore
planning for implementation, has been a challenge for all stakeholders
involved in access to ACTs. National malaria control programmes need to
understand their future needs, which may not be entirely in line with
historical consumption data. Central medical stores and procurement
agencies need to understand which drug to purchase, in what quantities,
and for what delivery periods. Funders and donor agencies must foresee
sufficient long term funding. Manufacturers must plan immediate
production capacity and assess the investments required to scale up in
order to meet future demand.
Good forecasting underpins many of these decisions. In light of this, the report ‘A Risky Business’, (download the report in PDF format 1.7MB) by the Centre for Global Development
provides an analysis of the problem, and an agenda for action. Taking
the ACT example as a case study, specific recommendations have been
developed for implementation by interested parties. Among the
recommendations is the creation of an "infomediary" — a neutral third
party to collect and disseminate essential data for forecasting demand.
MMV welcomes this focus on improving demand forecasting
for the antimalarials market. It continue to play an active role in
advocating for improved demand forecasting, coordinated by those
organizations with the best expertise and capacity to manage this
process.