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OBJECTIVES: 1. Review Procurement Cycle 2. Discuss factors influencing drug prices & total costs briefly 3. Give Overview of Procurement Methods 4. Give Detailed Account of Good Pharmaceutical Procurement Practices 5. Discuss How to Organize & Manage The Procurement System 6. Briefly Consider Financial Sustainability of the System 7. The above in the light of current pharmacy curriculum with. Expected Outcomes: Pharmacy practice teachers are better able to evolve a more appropriate and more systems-friendly curriculum & better able to impart knowledge to meet current & future demands on the pharmacist.
Procurement Methods
Open Tender Restricted Tender Competitive Tender Direct Procurement Note: Prior to Procurement, there is need for: Selection (based on Essential Medicines List) Quantification (Consumption, Morbidity, Adjusted Consumption model & Service-level Projection of Budget Requirements).
Procurement in Bulk
Concentrate purchases on limited List to increase quantities, reduce price Specify divided deliveries. Teachers: Lets build economy of scale into our presentation. Use this to illustrate what is taught in management. Buying in bulk is cheaper (cost, admin, etc) than raising LPOs often (open to corruption, stock-out, low quality, etc).
Contd.
Teachers: Let students know that the CV and antecedents of supplier is a prerequisite to a rational and successful procurement policy Suppliers must be screened regularly including surveillance (Monitoring) of their operations Set up Check-List of Performance Evaluate suppliers with relevant performance indicators. Emphasize that a good procurement cycle can be destroyed by an unreliable supplier!
Competitive Procurement
Use Competitive bidding on all but very small or Emergency purchases to obtain the best prices In Restrictive tender, only prequalified suppliers should be allowed to compete In Open tenders, suppliers must be evaluated after submission of bids.
Teachers:
Apply economic principles to emphasize buying in bulk (see Slide 10) Inculcate the reasons & How this discourages corruption which is almost in-built in incessant LPOs. Pharmacists are drug experts hence must show interest in the procurement process & study how to improve on what obtains. Encourage Innovative They must be conversant with the intricacies of the Tendering process and act as Watchdogs Bring up the Need for Ethics and the Law here and emphasize Compliance!!!
Sole-Source Commitment
Procure all contracted medicines only from winning suppliers Do not enter into any separate deals with noncontracted suppliers. Teachers:
Bring into focus the issue of complying with contracts (it is a legal issue) as taught in Pharmacy (Business) Law in Management Emphasize that lack of compliance can lead to Corruption/corrupt practices Remind them of Anti-graft (EFCC, etc).
Teachers:
Teach and bring out the Central role of Record-Keeping and Documentation Emphasize Medicines Management Information System (MMIS/DMIS) Give examples of How Information is Key to successful management of any system Encourage them to use information to develop/improve themselves/systems Pharmacists are strategically placed, teach them how they can generate data, gather information and how to document such.
Teachers:
Create Awareness that No Good Service can be sustained without Finance Emphasize the importance of Financial Planning Sensitize them to Financial Management Let them appreciate the application of Pharmacy Administration & Management Highlight need for efficient Financial Management as a tool to reduce medicine price, increase access, make health service more people-friendly and earn respect for the professional Drug Revolving Fund may be used as an example
Teachers:
Use this as an example of the Need for SOP in which there is Separation of Functions Teach them to spell out specific tasks and functions to be performed by which officer The Need for Time-frame, e.g, Supplier lead-time; How and when to check Quality Let them avoid overlap of functions because of its negative impact on management
Teachers:
Inculcate in them Discipline as per Quality Assurance Emphasize that medicines are for human consumption hence Quality is needed Discuss Sub-Standard medicines & Health hazards Highlight pharmacist Role as Protector of the Public Focus also on the Ethical & Legal issues on Quality of Product and service of practitioner
Teachers:
Teach them How to Formulate Performance Indicators Emphasize the Need to Apply such Indicators Give them Exercises on Criteria for Performance and Outcome Indicators Emphasize Regular Reporting as a Useful Management Tool