Public Health at Risk: Fixing the Flaws in Sri Lanka’s Medicine Distribution System

A comprehensive assessment reveals that Sri Lanka’s pharmaceutical supply chain, though grounded in strong public access, suffers from outdated procurement, weak quality assurance, and fragmented governance. Urgent reforms are needed to enhance efficiency, resilience, and equitable medicine access.

A recent assessment of Sri Lanka’s pharmaceutical supply chain, spearheaded by the Asian Development Bank (ADB) in close partnership with the Ministry of Health (MOH), Ministry of Finance (MOF), and with technical input from the World Health Organization (WHO), UNICEF, and the Sri Lanka Association of Clinical Pharmacology and Therapeutics (SLACPT), has revealed a complex mix of strengths and deep-rooted vulnerabilities. The study, conducted between September 2023 and May 2024, combined extensive field research, facility assessments, stakeholder interviews, and patient surveys. It offers a revealing account of how years of economic strain, pandemics, and governance gaps have weakened the country’s capacity to provide uninterrupted access to quality-assured medicines.

Access to Care vs. Reality on the Ground

Sri Lanka has long maintained a public health model that is the envy of many developing nations free, universal health services delivered through an extensive network of over 1,100 government-run facilities. With most of the population living within a 5-kilometer radius of a healthcare center, accessibility has never been the country’s primary challenge. Medicines, too, are distributed at no cost through public institutions. However, this ideal has been sharply tested in recent years. Patient satisfaction remains relatively high, with 81% reporting satisfaction with pharmaceutical services, but nearly half of those surveyed indicated that at least one of their prescribed medicines was unavailable during their visit. Long waiting times often stretching to three hours or more and poor patient counseling further expose the pressure on frontline services.

An Outdated and Inefficient Procurement Machine

At the core of Sri Lanka’s pharmaceutical supply issues is a procurement system that is outdated, slow, and insufficiently strategic. The State Pharmaceutical Corporation (SPC), responsible for the majority of national procurement, still relies on traditional bidding processes that can take over a year from estimation to delivery. Forecasting begins up to 18 months before supply is expected, resulting in significant mismatches between estimated and actual consumption. Some medicines were overestimated by as much as 300%, while others arrived late, leading to critical shortages and emergency procurement. From November 2022 to October 2023, only 52% of orders were delivered on time. Although the newly introduced SWASTHA digital platform promises better inventory visibility and logistics data integration, many health facilities lack the internet access or trained staff to use the system effectively.

Gaps in Quality Control and Pharmacovigilance

Perhaps most alarming is the weak quality assurance framework surrounding the country's medicine supply. The National Medicines Regulatory Authority (NMRA) and its laboratory wing, the National Medicine Quality Assurance Laboratory (NMQAL), are severely understaffed, with only a quarter of the required personnel in place. Infrastructure is inadequate, and routine quality checks are minimal. Premarketing quality assurance largely relies on paperwork and product registration, rather than actual testing of batches. During the economic crisis, large volumes of donated medicines often with labels in foreign languages or close to expiry were admitted into the system without the necessary regulatory scrutiny. The pharmacovigilance system, responsible for monitoring adverse drug reactions, remains underdeveloped and is limited to spontaneous reports, with no active surveillance system in place.

Fragmented Governance and Irrational Use of Medicines

Sri Lanka’s pharmaceutical governance is undermined by overlapping roles, unclear mandates, and a lack of institutional accountability. Key players such as MSD, SPC, NMRA, and various advisory committees function in parallel, often without coordination. The National Essential Medicines List (EML) exists but is diluted by an additional procurement list of over 850 medicines, which frequently includes items added upon request rather than therapeutic needs. There is no health technology assessment unit to evaluate the cost-effectiveness or efficacy of medicines, and national treatment guidelines are rarely updated or enforced. Prescription audits are absent, leading to high variation in prescribing practices and increased pressure on procurement systems. All of this fragments demand in an already small market, limits economies of scale and drives up costs.

Local Industry and Workforce: Missed Opportunities

Only 30% of the medicines on the country’s priority procurement list are locally manufactured, and nearly all active pharmaceutical ingredients are imported. While domestic producers are supported through buyback guarantees and price markups, many cannot achieve economies of scale, particularly for low-volume, high-cost items. As a result, these products are often far more expensive than international benchmarks. Meanwhile, the workforce behind Sri Lanka’s pharmaceutical supply chain lacks the specialized training needed for modern supply chain management. Although pharmacy degree programs exist at several universities, none offer courses on pharmaceutical logistics or procurement. There are no in-service training programs available, and many staff at primary and secondary care levels are without formal pharmaceutical qualifications.

A Call for Strategic Overhaul

The assessment concludes with a stark message: while Sri Lanka’s foundational commitment to equitable healthcare is laudable, the pharmaceutical supply chain must evolve or risk collapse under future shocks. The report outlines seven key reform pathways, including strengthening governance, modernizing procurement through digital tools and strategic contracts, optimizing distribution networks, upgrading data analytics, enhancing quality assurance systems, training a skilled pharmaceutical workforce, and exploring regional partnerships for pooled procurement and market access. Drawing on international best practices from India’s essential medicines policy to New Zealand’s price negotiation models the report urges Sri Lanka to transition from a rigid, centrally controlled model to a more flexible, data-driven, and performance-oriented system. If implemented effectively, these reforms could not only stabilize medicine availability in the short term but also transform Sri Lanka’s pharmaceutical supply chain into a regional model of efficiency, transparency, and resilience.