NTA Level 5 • Semester 1 • PST05101

Application of Quantification Methods

Medicines and Medical Supplies Management • Source Session/Topic 7

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Session 7: Application of Quantification Methods

Total Session Time: 120 minutes

Prerequisites

• Completion of session 6

Learning Tasks

By the end of this session students are expected to be able to:

• Explain applications of the quantification methods

• Carryout the calculations in different quantification methods in full

supply

• Carryout the calculations in different quantification methods in Non-full

supply

Resources Needed:

• Flip charts, marker pens, and masking tape

• Black/white board and chalk/whiteboard markers

SESSION OVERVIEW

SESSION CONTENTS

STEP 1: Presentation of Session Title and Learning Tasks (5 minutes)

READ or ASK students to read the learning tasks and clarify

ASK students if they have any questions before continuing.

STEP 2: Applications of Quantification Methods (90 minutes)

|Activity: Small Group Discussion ( 15 minutes) |

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|DIVIDE students into manageable groups |

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|ASK students to discuss in groups on the following question: |

| |

|What are the applications of quantification methods? |

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|ALLOW students to discuss for 15 minutes |

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|ALLOW each groups to present |

| |

|CLARIFY and SUMMARIZE by using the contents below |

The following are the applications of quantification methods;

• Calculating order quantities for procurement: Formal quantification may

be necessary before each scheduled procurement. These estimates need to

be accurate to avoid stock outs, emergency purchases, and overstocks and

to maximize the effect of procurement funds. The consumption method is

the first choice, cross-checked to assess the appropriateness of usage

and demand patterns. When consumption data are unreliable or unavailable,

such as in new programs, the morbidity method, the proxy consumption

method, or both, may need to be applied for an initial quantification,

switching to the consumption method when reliable data can be compiled or

the program has stabilized.

• Estimating budget requirements: In many countries, the annual

pharmaceutical procurement budget is determined by adding a fixed

percentage to the previous year’s request or allocation to allow room for

contingencies, such as expected cuts by the ministry of finance,

population growth, or expansion of services. Both budget requests and

cuts are frequently prepared without reliable estimates of actual needs.

This cycle can be broken with rational, well-documented quantification.

Although consumption-based quantification is the best guide to probable

expenditures, the morbidity-based method may be the most convincing

documentation for a budget request. Proxy consumption is useful for

checking and justifying either consumption or morbidity methods. When

budget requirements do not need to be justified by specifying order

quantities, the service-level method can be used as an alternative.

• Estimating pharmaceutical requirements for emergency relief situations:

In emergencies such as floods or earthquakes, the first step is to

provide emergency kits quickly. As local health problems become clear, a

morbidity-based method can be used to project requirements in the short

and medium term, until the regular supply system can resume services.

• Developing procurement quantities for new programs: When medicines are

needed for launching a new full-service health system or vertical program

(such as HIV/AIDS programs or DOTS), quantification serves two purposes:

to establish funding requirements for procurement and to develop the

initial procurement list. In most situations, the consumption-based

method is not feasible, and some combination of morbidity-based and proxy

consumption methods must be used for the initial quantification.

• Developing procurement quantities for scaling-up programs: Scaling up is

the term used to describe an incremental increase or growth in the number

of patients being treated over a period of time. Patient-months can be

used to estimate needs for scaling up, where one “patientmonth” is the

quantity of a product needed to treat one patient for one month. The

total number of patients treated over an incremental period of time in

months is often used in this situation for estimating needs for chronic

conditions. For example, programs may not be able to serve all the

patients needing ART at the start of an HIV/AIDS program but are able to

scale up slowly as they receive additional donor funds, human resources,

and training and address other access barriers

• Quantifying for assistance projects: A donor organization may undertake

ad hoc quantification studies to plan procurement needs in the context of

a development project. When local consumption data are not sufficiently

reliable for quantification, the morbidity or proxy consumption method

should be used, either singly or in combination.

• Estimating pharmaceutical requirements for emergency relief situations:

In emergencies such as floods or earthquakes, the first step is to

provide emergency kits quickly. As local health problems become clear, a

morbidity-based method can be used to project requirements in the short

and medium term, until the regular supply system can resume services.

• Comparing actual medicine consumption with theoretical need: In most

functional supply systems, the regular procurement quantification is

based on past consumption. However, periodic comparison of consumption

with theoretical demand based on public health priorities is a useful

practice. The morbidity-based method provides the most informative

comparison, but simply comparing consumption data from different systems

is worthwhile because significant differences in medicine use can help

identify irrational prescribing patterns or persistent inventory

problems.

STEP 3: Calculation in Consumption Based Quantification Method in Full

Supply (40 minutes)

In calculating amount to order where there is no stock-out experienced in

the last period:-

|Activity: demonstration in calculation (40minutes) |

| |

|Ask students to observe carefully on the explanations as you |

|demonstrate how to calculation usage in a period = E and quantity to|

|order Qo |

| |

|Divide the students into groups of three |

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|Instruct the groups to attempt to calculate Qo in exercise 1A |

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|ALLOW one group to present and allow other groups to comment |

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|CLARIFY and SUMMARISE by making correction if needed |

Calculation amount used in a three months period = E

• E = A+B +- C-D

• E is usage in a period

• A is balance at the beginning of the period

• B is Amount received during the period

• C is loses and adjustments

• D is the physical stock on hand at time of ordering

Calculating the monthly average

AVERAGE = (E/3)

• Calculating quantity

QO = (E/3)x7 –D

Where QO is amount to be ordered for the next period

3 is a period of three months

7 is used to make an order for seven months

Exercise

The physical stock of Asprin in Gingisi Dispensary is 2250 tabs, but the

opening stock in the last three months was 2750 tabs, in this quarter

the dispensary received 2 tins of 1000 tabs each. There was no loss or

any adjustment necessary for this period.

(i) Calculate E that is usage in a period

(ii) Calculate QO that is amount to be ordered for the next for the

next three months period

STEP 4: Exercise the Calculation in Consumption Based Quantification

Method in Non-Full Supply (35 minutes)

|Activity: Demonstration in calculation (35minutes) |

| |

|Ask students to observe carefully on the explanations as you |

|demonstrate how to calculation adjusted E |

|Divide the students into groups of three |

| |

|Instruct the groups to attempt to calculate Qo in exercise 2A |

| |

|ALLOW one group to present in the flip chart |

| |

|CLARIFY and SUMMARISE by making correction if needed |

Adjustment for stock out

In case there was stock out in the last quarter if no action taken the next

quarter will experience stock out again

We don’t want it to happen, thus we need to adjust for stock out to void id

it happening in future

• How?

– Find out the stock was enough for what % of the period. (make

it into decimal point( e.g. 83% = .83)

– If the amount used in that period (quarter) is 234 ampoules

then divide this amount with percentage in decimal point.

(234/.84 = 278.57 = 279 Ampoules)

– The usage ( amount) for the period E is supposed to be 279

ampoules

– ( an addition of would 279 -234 = 45 ampoules)

– The adjusted E is calculated amount which is used in

calculating Qo

Exercise 2A

• Marimba Health Centre use 600 vials of PPF in the last quarter. From

the records the facility experiences stock-out of PPF vials for 19

days within the last quarter.

i) Calculate the requirement of PPF next quarter after adjusting for

stock out.

Worked example

ii) Usage was 600 vials

iii) It was stock out for 19 days

iv) Thus it was enough for 90-19 = 71days

v) The ratio = 71/90 = 0.78888 = 0.79

vi) The adjusted usage = 600/0.79 =759.493

= 760

vials

a. This (760 VIALS) is this calculated amount which is used in

calculating Qo

b. That is E =Estimated usage

STEP 5: Key Points (15 minutes)

• There are different types of quantification methods which are used in the

quantification of medicines and medical supplies

• Quantification methods are very important and have got a lot of

applications such as; Developing procurement quantities for new programs,

Developing procurement quantities for scaling-up programs, Quantifying

for assistance projects, Estimating pharmaceutical requirements for

emergency relief situations and Comparing actual medicine consumption

with theoretical need; just to mention a few

• In a nutshell, these applications are for the purpose of ensuring

availability of medicines and medical supplies of the community in normal

situations and in emergency situations

STEP 6 : Evaluation (5 minutes)

• What are different types of quantification methods which are used in the

quantification of medicines and medical supplies?

• What are the applications of quantification methods?

References

MSH and WHO (2012) Managing Access to Medicines and Health Technology,

3rd Edition. Kumarian Press

World Health Organization (WHO), Regional Office for Africa

Brazzaville 2004, Management of Drugs at Health Centre Level Training

Manual.

United Republic of Tanzania Ministry of Health and Social Welfare,

Strategy for Development and Implementation of an Integrated Logistics

System for Essential Health Commodities: Government Printers, Dar es

Salaam

USAID | DELIVER PROJECT, Task Order 1. 2011. Tanzania: 2020 Supply

Chain Modeling—Forecasting Demand from 2020–2024. Arlington, Va

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