Shortage of TB drugs in India – a major producer of these drugs

An article in the Wall Street Journal (June 6,2013) describes severe shortages of tuberculosis (TB) drugs in India, a country that is a major producer of TB drugs. TB kills a significant number of Indians and the government has been providing free treatment to eradicate the disease. But the expiration of a UK grant to pay for the drugs, and delays in government issue of required purchase orders, are supposed to have created the observed shortages. But drug manufacturers claim that poor forecasting and erratic orders are the cause of the observed shortages. Also, erratic use of the drug increases the drug resistance of the disease and makes treatment difficult. Low margins, poor supply chain management and poor forecasting are claimed to be causes. Should margins be increased to incent greater availability ? Should the forecasting of requirements be a private industry function with appropriate incentives for more accurate demand estimates ? Should vendor managed inventory contracts be provided to manufacturers to get them to maintain adequate supply ?

About aviyer2010

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