purchasing medicines.

1. M U H A M M A D U S M A N S A R W A R ( 1 4 2 5 4 )
A B D U L L A H B I N T A R I Q ( 1 4 6 5 9 )
H A F S A H A Q ( 1 4 7 8 0 )
B I S M A N A Z E E R ( 1 4 6 7 5 )
PURCHASING MEDICINES

2. INTRODUCTION
MUHAMMAD USMAN SARWAR
(14254)

3. Background
The Pharmaceutical Price Regulation Scheme PPRS
The PPRS is a UK government scheme that control the prices of branded
prescription medicines supplied to the NHS.
The scheme supports an industry that will continue to offer innovative
medicines and is competitive internationally.
Under the PPRS suppliers are allowed to introduce new medicines to the
NHS.
Generic Substitution
NHS hospital pharmacies have dispensed medicines generically,
irrespective of how they are prescribed. Thus a brand name may be used
by the doctor but a generic version issued.

4. Aims Of The Service
 Obtaining medicines from manufacturers, wholesalers and short-line
stores is an essential part of the pharmacy service.
 Medicine purchasing needs to be carried out with probity.
 Avoid excessive stock within the pharmacy. High stock levels also lead
to waste and will require more space, there is also risk that a change in
clinical practise could lead to wastage.
 The avg. stock holding for a hospital pharmacies has been estimated at
approximately 1 month’s supply.

5. Hospital Procurement And The Application Of EU
Legislation
The EU regulates all large-scale public sector procurement through EU
directives covering the supply of goods, services and works.
As a result of EU membership hospital procurement is subject to the
directive within the treaty of Rome, including article 12 ( prohibition of
discrimination on grounds of nationality), article 28 (free movement of
goods within EU ) and article 81 (prohibition of agreements that prevent ,
restrict or distort competition).
The main requirements are:
 The advertisements of large public contracts to a standard format so
that suitable suppliers from all EU countries have the opportunity to
declare their interest.
 The use of technical specifications which are non-discriminatory and
which refer to EU or other recognized international standards.
 The use of objective criteria for selective participants and awarding
contracts.

6. Contracting Procedures
The regulations recognise 3 contracting procedures which are as follows:
1-Open procedure:
It involves only a single stage. All offers received must be considered, provided
that candidates have passed any minimum short-listing criteria. The open
procedure can be conducted more quickly than the restricted procedure but there
is no possibility of limiting the number of bids received.
2-Restricted procedure:
Involves 2 stage procedure. From amongst the candidates
expressing interests (1st stage) it is possible to shortlist a limited number
from whom to invite offers.(2nd stage)
3-Negotiated procedure:
Least transparent of the 3 procedures. It is used only in limited
circumstances .

7. Abdullah bin Tariq (14659)

8. OFFER EVALUATION

9. REQUIREMENT OF DIRECTIVES
 Contract should be given to candidate who offers
lowest priced tender.
 The factors include price, service quality, running
cost
 Chosen factors must be mentioned in OJEC notice
or contract docoments.

10. NEGOTIATION WITHIN THE PROCESS
 No post-tender negotiations are favored b/w buyer
and the candidate.
 Negotiation include fundamental aspects of bids
e.g. price.
 Discussions for clarifying the content are
permitted (all candidates are treated equally).
 Pre-tender discussions are critical for designing
contracts.

11. TYPES OF CONTRACTS
 Two types:
 Commitment contract
 Framework contract

12. COMMITMENT CONTRACT
 Commits legal entity like NHS to purchase defined
quantity of product at defined price.

13. FRAMEWORK CONTRACT
 Doesn’t guarantee to deliver commitment.
 Provides framework based on volume against
which purchase orders will be placed by group of
hospitals covered in the agreement.
 Sets terms and conditions of purchase by hospitals.
 Also form a trust contact while placing purchase
order.

14. Cont…
 Normally used on behalf of purchasing groups in
recognition that a hospital in the purchasing group
cannot deliver volume according to contract on
behalf of the group.

15. STRENGTHS OF CONTRACTING
PROCESS
 If the process is auditable, legal
 Provides a framework for equal treatment with all
bidders
 Establishes clear trading basis b/w NHS and its
suppliers.
 Provides a fair test of value for cost on behalf of
NHS.

16. ORGANISATION OF HOSPITAL CONTRACTS
 Hospitals aggregate their purchasing power
through their pharmacy purchasing groups.
 NHS CMU then competitively tenders, awards and
manages the resulting contract as agent on behalf
of the group.
 An individual must be nominated who represents
interests of its hospital managers and budjet
holders on its purchasing group.

17. NOMINEES ROLE
 Sharing information, adjudicating contracts and
participating in collective dialogue with NHS CMU
buyer dedicated to work with the group.
 They use their knowledge and experience gained
from managing medicines on day to day basis for
contracts management.

18. STANDARD PURCHASING GROUPS
 In England, six main purchasing groups work on
geographical basis.
 Some are divided into smaller groups.
 Each main group owes contracts b/w 1500__2000
lines each representingabove 200 suppliers.
 Contracts on behalf of these groups are framework
contracts that don’t guarantee commitment, the
ownership of contracts ensure that they are highly
effective.

19.  They may vary in length on behalf of each
purchasing group.
 Typically, they last for maximum period of 2
years with an option for maximum period of
2 years for extension.

20. PHARMACY PURCHASING GROUPS
 Important whendecisions around clinical choice of
medicines can be influenced at local level.
 Product ranges contracted at this level include
branded medicines, bulk fluids, therapeutic
tenders, service contracts etc .

21. TRUST CONTRACTS
 Some medicines are still contracted for at trust
level.
 Driver is to move as much contracting to
purchasing group and national level as possible.
 Aggregation of usage improves purchasing power.

22. Hafsa haq (14780)

23. System and Processes
Pharmacy specialists and working relationships with
procurement:
 The specialists within the pharmacy strengthen the contracting
agreements.
 Pharmacy quality control are involved in assessing product quality as
part of tendering process, as well as on day to day basis.
 Specialist involvement and relationships b/w trusts and their buyer,
minimises duplication of effort through shared access to central
contract management and associated procurement expertise.

24. NHS CMU management system:
 It manages the contracting process.
 Using a system called phacter.
Phacter:
 It maintains a database of all suppliers and product lines.
 It generates invitations to tender and produces comparative
evaluations.
 It collects hospital pharmacy purchasing information through a system
known as Pharmex. (At each month end)
Pharmex Data:
 It is used to scope NHS secondary care business for tender.
 It also provide NHS CMU with individual trusts and measures
reporting the performance of contrafting agreements.

25. Pharma QC:
 Through this system NHS CMU collects and stores product images and
supply chain information from suppliers.
 QC Pharmacist access this system to record their product assesments.
 This information ensures that QC product quality and risk assesments
are reflected when contracts are awarded.

26. Meeting Structures:
 Totality of contracting agreements is done through meeting
arrangements and communication structures.
 All of them meet regularly to share information,adjusticate contrcts and
monitor performance.
PMSG: (Pharmacuetical Market Support Group)
 It brings pharmacuetical expertise around a focus of contract
management,making sure that security of supplies is placed above
savings.
 It reports to NPSG (National Pharmacuetical Supply Group).
NPSG:
 Its role is to provide advise to NHS CMU to ensure that it manages and
developes its serivce in line with NHS requirements.

27. Recent Changes:
 All the following changes will have long term impact:
Home Care:
 It is the growth in supply of medicines to patients at home.
 It represents a major part of NHS business.
 The NHS focus lies with the National home care committee.
Other service contracts:
 NHS is increasingly outsourcing other services such as outpatient
dispensing,the provision of aseptically prepared products and ‘specials’
by increasing demands on its finite capacity or by National Patient
Safety Agency Guidance.

28. Payment by results and nice:
 The PPRS 2009 allows health pharmacuetical companies to propose
patient schemes to improve the cost effectiveness of medicines.
 If NICE approves or partially recommends the medicine, these schemes
become operational in order to achieve cost effectiveness approved by
NICE.
 Types of schemes
Security of supply:
 Globalization within the pharmaceutical industry and other factors are
all contributing to increase stresses within the supply chain,increasing
risks of supply.
 The associated risks with the supply of counterfieit medicines are also
increasing.
 All departments work together to minimise these risks.

29. GRACIAS