The Central Laboratory of the Centre for Infectious Disease Research in Zambia (CIDRZ) has developed a profitable business model that might offer wealthy nations a way to jumpstart similar programs worldwide, then create profit centers to help sustain them.
This business model, developed under the leadership of Executive Director Jeff Stringer, MD, and Laboratory Director Ron Brown in collaboration with the lab’s new Business Manager Henry Latner-formerly of PACLAB Network Laboratories in Washington’s Puget Sound region-creates a sustainable funding source to assist funding at 64 free AIDS clinics in urban Luska, Zambia. The clinics provide more than 140,000 HIV-infected adults and children Antiretroviral Therapy (ART) and Prevention of Mother to Child Transmission (PMTCT) services.
With funding from the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR) , the Central Laboratory experienced rapid scale-up of services over the last four years, growing at an annual rate of about 250%. Today, the lab performs more than one million tests annually.
The steep growth curve caused Brown to focus on workload forecasting and continual service demand projections to ensure adequate testing resources are in the pipeline as needed to meet demand for growing services. This prudent planning resulted in operational efficiencies that created consistent excess testing capacity in key analytic areas, allowing the laboratory to market testing services to private sector clinics, faith-based and other non-government organizations in the region. Offering this service added a revenue stream for sustainable growth that reduces dependency on foreign donor support for anti-retroviral treatment programs.
Latner’s business plan called for building the for-profit laboratory service on an existing, well-established services foundation, including current courier routing and result delivery systems, and focusing on creating efficiencies and standardizing work in pre- and post-analytical areas of the lab.
CIDRZ Medical Laboratory Ltd., a separate, not-for-profit company which falls under the parent company of CIDRZ, now provides daily, full-service laboratory support to several hospitals and care clinics throughout the greater Lusaka region. Key to the success of this service are the focus on consistent, predictable, high-quality laboratory testing, with excellent customer service and a fair market price.
This business model was evaluated by a team from the Global Health Delivery program at Massachusetts Institute of Technology’s Sloan School of Management to validate current financial forecasts and potential for additional revenue streams, based on demand for private healthcare growth and market research. The analysis indicated potential for continued growth in demand for laboratory services by private care facilities in this region, and if managed well, Central Laboratory can expect a strong, sustained revenue stream to support CIDRZ care and treatment programs well into the future.