Oxygen Program Business Model KENYA AND RWANDA
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1 Oxygen Program Business Model KENYA AND RWANDA
2 Oxygen Program Goal Improve patient health at hospitals surrounding Siaya, Kenya and Ruhengeri, Rwanda by providing an affordable and reliable oxygen supply through a sustainable business model that can be scaled.
3 Key Problem Oxygen is provided two different ways: cylinders or concentrators. Problems arise with either method. CYLINDERS Cylinders can be prohibitively expensive. Plants that produce cylinders are often located far from hospitals. Transportation of cylinders is expensive. Transportation problems affect cylinder availability. Wards can often be without oxygen when cylinders need to be refilled from distant oxygen plants. CONCENTRATORS Initial concentrator costs are modest and maintenance costs are low. However, concentrators are often broken because they lack regular maintenance or a small repair part. Concentrators cannot function during power failures, and many rural hospitals have inadequate back up power.
4 Our Program s Solution Provide a privately run oxygen plant that fills cylinders located on the grounds of a local public hospital. Oxygen plant on commissioning day in Siaya, Kenya. Oxygen plant provides all required oxygen for host hospitals (Siaya Hospital and Ruhengeri Hospital) Oxygen plant generates more oxygen than host hospital needs Surplus oxygen is stored in cylinders and sold at an affordable cost to surrounding hospitals Oxygen plants reliably deliver oxygen to customers using trucks, ensuring that hospitals can depend on their next supply of oxygen
5 Kenya Public Private Partnership Structure GOVERNANCE COMMITTEE Includes government, local hospital, and private representatives. They make decisions related to strategy, sustainability, and growth. LOCATION The oxygen plant was installed on the public grounds of Siaya Hospital. MANAGEMENT Oxygen plant is managed by private entity (Hewa Tele), responsible for operations, maintenance, administration, personnel. PPP AGREEMENT PPP agreement between local hospital and private entity for exchange of services (e.g., facility rent and fees for discounted oxygen) and investment terms.
6 Kenya Business Model Plant equipment was donated by the GE Foundation. Plant land was donated by the public hospital. Plant governance committee includes local ministry of health officials, Siaya Hospital officials, and private representatives (The Center for Public Health and Development our partner). Hewa Tele manages daily oxygen plant operations. Hewa Tele is an offshoot of our partner, CPHD. After the program ends, the private entity Hewa Tele will still exist and will continue to run the plant.
7 Kenya Overview Period of Operation (Date of plant launch to date March 31, 2015) Nov 19, 2014 March 31, 2015 # Staff 6 # Customers 19 Total Revenue 458,549 KES after withholding VAT
8 Rwanda Agreement Structure EXECUTIVE COMMITTEE Includes local government, Ruhengeri and private representatives. They make decisions related to strategy and reinvestment. LOCATION The oxygen plant will be installed on the public grounds of Ruhengeri Hospital. MANAGEMENT Total Oxygen Solutions managed by private entity (the Access Project for pilot), responsible for operations, maintenance, administration, personnel. LETTER OF AGREEMENT Letter of agreement between Ruhengeri and private entity for exchange of services (e.g., facility rent and fees for discounted oxygen) and investment terms. 8
9 Rwanda Business Model Plant equipment was donated by the GE Foundation. Plant land was donated by the public hospital. Plant executive committee includes local ministry of health officials, Ruhengeri Hospital officials, and private representatives (the Access Project our partner). The Access Project will directly manage daily oxygen plant operations. After the program ends, the oxygen plant will be guided by the executive committee but run by Ruhengeri Hospital.
10 Rwanda Overview Period of Operation (Date of plant launch to date March 31, 2015) Dec 01, 2014 March 31, 2015 # Staff 1.5 # Customers 3 Total Revenue 2,665,500 (RWF)
11 Oxygen Plant Customers KENYA RWANDA The Kenyan public health system has many more private influences than Rwanda. There are many more potential customers in Kenya than Rwanda. Customers include public hospitals, private hospitals, and faith-based hospitals. The Kenyan program provides accessories like masks and flow meters to customers. The Rwandan public health system is primarily run by the state with very few private health care facilities. Although there are fewer Rwandan customers, they tend to purchase higher quantities. The Rwandan program does not currently provide oxygen accessories.
12 Sources of Revenue Revenue generated through sales eventually will cover operating expenses. CYLINDERS OF OXYGEN OXYGEN ACCESSORIES CYLINDER DELIVERY
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