News & Insights
3 keys to building a sustainable health services program
by Agnes Cho, program associate, Global Partnerships
As a Global Partnerships program associate, a position partially funded by the Princeton in Latin America Fellowship, I have been working with GP’s Program & Impact team since September to support GP’s health and green technology initiatives. For one year, I will be based out of GP’s office in Nicaragua and working onsite with our partners to help implement and evaluate their programmatic work. I’ll be reporting back here with regular updates from the field!
Most recently, I spent three weeks in Honduras to collaborate closely with COMIXMUL/FUDEIMFA as they strengthen their community pharmacy program and work towards a sustainable business model. Their community pharmacy program utilizes a network of women in rural communities to operate home-based pharmacies; these pharmacies provide vital access to anti-diarrheal medications, painkillers, and other kinds of pharmaceuticals.
Since partnering with GP in 2012, COMIXMUL/FUDEIMFA has been looking for ways to achieve financial sustainability, increase medicine sales, and further support their dispensadoras (the women who operate the pharmacies from their homes) and the community promoters (they facilitate communication between the dispensadoras and COMIXMUL/FUDEIMFA).
Over the course of working with Global Partnerships, COMIXMUL/FUDEIMFA has implemented a few changes to their business model, which have been outlined in a previous blog post. Earlier this year, they scaled to 301 community pharmacies, established a 10 percent commission for their dispensadoras to incentivize higher sales, and adopted a smarter purchasing strategy to stock the quantity and kinds of medicines that have proven to sell.
During my visit, I interviewed 41 dispensadoras and all six community promoters to hear from their perspective what it takes to build a sustainable program. Here are the results of those conversations:
1) Selecting and supporting the right dispensadoras
- The most successful and motivated dispensadoras had prior experience working in the health sector, either as a nurse or as a volunteer for the public centro de salud. They are already recognized and trusted in their communities as a source of medical knowledge.
- However, COMIXMUL/FUDEIMFA also works with women without health experience, which requires extensive training and support (i.e. training workshops, a manual, the phone number of a nurse that can be reached in moments of doubt or emergencies).
This point is often emphasized by organizations that implement microentrepreneurship programs, such those I met at the FOMIN/IDB conference in September, entitled “Accessing New Markets through Inclusive Distribution Networks.” In the various working groups during the conference, there were many conversations about the necessary conditions for a true win-win micro-enterprise created by and for the bottom of the pyramid. I was happy to find that the two factors that were highlighted throughout the conference were a central part of COMIXMUL/FUDEIMFA’s pharmacy program:
1. Thorough and continuous training and support of the microentrepreneur; and
2. Financial risk sharing so the microentrepreneur won’t be burdened with the entire cost of failure.
In my interviews, I found that dispensadoras that have received more training by COMIXMUL/FUDEIMFA were more likely to sell more medicine and report higher self-confidence in their health knowledge and business skills.
2) Clear communication between the dispensadora and the community promoter
- Currently, the six community promoters make monthly supervision visits to all 301 pharmacies. In these visits, the primary objective is to record the inventory and restock the pharmacy. However, the supervision visits can also be used as a way to listen to and incorporate the advice of the dispensadora. During the hour or so that is spent with the dispensadora, the promoter learns from her which medicines are in demand, which prices are set too high, and upcoming activities, such as public medical brigades, that will increase demand for medicine. This relationship is integral to the program’s supply strategy, because the experienced dispensadora knows best which medicines in what quantities s/he will be able to sell in the upcoming months.
3) Identifying the determinants of demand
- A community’s demand for medicine depends upon a confluence of factors. Seasonal illnesses, which vary by region and by community, determine which medicines will be in demand.
- A productive alliance with the public health center serves as a pipeline to the pharmacy, but their periodic stocks of free medicine also reduces demand. The demand for medicine is very sensitive to the price at the community pharmacy, as well as the comparative prices in the local corner stores and private pharmacies. Identifying the factors that determine demand helps COMIXMUL/FUDEIMFA make smarter purchasing, stocking and pricing decisions.
At the end of the day, the purpose of building out a sustainable business model is to ensure that more families in rural areas can access the medications they need at affordable prices. After all, good health is the foundation upon which better lives are built. Meet some of the dispensadoras I visited here.