Lessons from one year experience of pooled procurement of pharmaceuticals: exploration of indicators and assessing pharmacies` performance

Abstract

Background Joint procurement of medicines is a way to improve access and justice in developing countries. The aim of this study is to determine local indicators for assessing the performance of joint procurement agencies and compare the indicators in those pharmacies which use centralized purchasing before and after this change. Methods This was a mixed method study. In the first qualitative phase, 3 expert panels were held including 20 national experts who were selected through purposeful sampling. Data was analyzed applying a five-stage framework analysis using MAXQDA. In the second quantitative phase, financial, supply and procurement, physical and functional indicators of two hospitals affiliated with joint procurement were assessed and the satisfactions of patients from the pharmacy performance were compared applying a valid questionnaire. Data was analyzed using SPSS through independent test, Paired t-test and ANOVA. Results Results show that after settlement of joint procurement, the cost of transportation has increased by 54%, a part of the cost of overhead has increased by 30%, the cost of manpower has increased by 88.9% and cost of insurance of warehouses has increased by 71.85% in 2016 compared to 2015. In addition, the total costs of holding were 89.8% of selling revenue. In other words, the profit was about 10% of revenue in total. Moreover the average score of pharmacies under the Holding has been higher than similar ones in all aspects of satisfaction from the patients`points of view. Conclusion The one-year experience of deploying centralized purchasing to supply medicine has led to increased income and patient satisfaction. However, increase in staffing costs, longevity, overhead and warehouse costs have been significant that need appropriate monitoring and interventions.

Has the Volume-Based Drug Purchasing Approach Achieved Equilibrium among Various Stakeholders? Evidence from China

“…In summary, VBP has been effective in addressing poor access to essential medicines, saving healthcare costs and accelerating generic substitution, which is consistent with the results of studies by Peivand et al in Iran [ 2 ] and Chaumont et al in Mexico [ 47 ]. However, it still lacks guarantees about the sustainability of the fund, balancing the needs of market players, and constructing a reasonable indicator system to ensure the safety of clinical drug use, which is consistent with the results of studies by Dylst et al in Europe and Roy et al in Delhi [ 28 , 48 ].…”

“…The principle underlying MDS is the use of statistical scores from a set of items or different indirectly measured results as data input, with the relationships among the items displayed on the coordinate axes; similar items are close together, while distinct items are farther apart [ 44 ]. The content located at the center of the coordinate system is related to more points and is more crucial, while the content located at the periphery has a weaker relationship with other points [ 2 , 45 ]. The fit of the model was tested using stress (calculated based on the Kruskal stress value) and Dispersion Accounted For (DAF, equivalent to the squared correlation—RSQ of classic MDS).…”

“…Different countries, through either social or commercial insurance systems, have developed centralized procurement models to varying degrees, and have explored delivery mechanisms to provide the lowest possible drug prices through price–volume agreements [ 1 ]. Joint procurement of medicines is one way to improve access and fairness in low- and middle-income countries [ 2 ]. Health policy bodies such as the World Health Organization (WHO) have adopted policies such as strategic purchasing and centralized procurement to provide fairness and reform access to pharmaceutical systems in developing countries.…”

Building Resilient Health Systems: Patient Safety during COVID-19 and Lessons for the Future

“…Collective bargaining for better pricing: Centralised pooled procurement drives down the costs based on economies of scale as demonstrated by the Rajasthan’s ‘ Mukyamantri muft dawa yojana ’ (Hindi words for ‘Chief Minister’s free Medicine scheme’). The smaller states, UTs and municipalities can benefit from collective bargaining and procurement mechanisms (Bastani et al, 2020).…”

“…• Collective bargaining for better pricing: Centralised pooled procurement drives down the costs based on economies of scale as demonstrated by the Rajasthan's 'Mukyamantri muft dawa yojana' (Hindi words for 'Chief Minister's free Medicine scheme'). The smaller states, UTs and municipalities can benefit from collective bargaining and procurement mechanisms (Bastani et al, 2020). • Ensuring safe and appropriate medicines and medical technology: By establishing health technology assessment, robust regulations, quality check mechanisms for counterfeit, spurious and substandard drugs (Orubu & Ching, 2020).…”