A System Dynamics for Analyzinging bullwhip Effect in Drug Supply Chain Considering Targeted Subsidy Plan

Objectification of subsidy plan could be described as one of the best government plans and policies. According to perspective document 2025 that consider the first place in economy for Iran and regarding to government financial limitation on national economy, the reform of economic policies is a part of economic necessity for Iran. In this paper, by establishing a suitable system dynamics model, we plan to represent the efficacy of the direct subsidy distribution on level satisfaction of people from drug price changes and also consider the efficacy of this subsidy distribution on total profit of drug supply chain. First, a system dynamics of drug supply chain by considering the direct subsidy distribution have modeled. Then, the model is simulated. To do this, the casual loop diagram is depicted and then with its help, the stock and flow diagram constructed. The simulation results show the unsuitable performance for implementing the subsidy objectification. As a result, two strategies have been suggested to improve the situation.