A cross-sectional survey of the models in Bihar and Tamil Nadu, India for pooled procurement of medicines.
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Date
2015-01
Journal Title
Journal ISSN
Volume Title
Publisher
WHO Regional Office for South-East Asia
Abstract
Background: In India, access to medicine in the public sector is significantly
affected by the efficiency of the drug procurement system and allied processes
and policies. This study was conducted in two socioeconomically different states:
Bihar and Tamil Nadu. Both have a pooled procurement system for drugs but
follow different models. In Bihar, the volumes of medicines required are pooled
at the state level and rate contracted (an open tender process invites bidders
to quote for the lowest rate for the list of medicines), while actual invoicing and
payment are done at district level. In Tamil Nadu, medicine quantities are also
pooled at state level but payments are also processed at state level upon receipt
of laboratory quality-assurance reports on the medicines.
Methods: In this cross-sectional survey, a range of financial and non-financial data
related to procurement and distribution of medicine, such as budget documents,
annual reports, tender documents, details of orders issued, passbook details and
policy and guidelines for procurement were analysed. In addition, a so-called ABC
analysis of the procurement data was done to to identify high-value medicines.
Results: It was observed that Tamil Nadu had suppliers for 100% of the drugs
on their procurement list at the end of the procurement processes in 2006, 2007
and 2008, whereas Bihar’s procurement agency was only able to get suppliers
for 56%, 59% and 38% of drugs during the same period. Further, it was observed
that Bihar’s system was fuelling irrational procurement; for example, fluconazole
(antifungal) alone was consuming 23.4% of the state’s drug budget and was being
procured by around 34% of the districts during 2008–2009. Also, the ratios of
procurement prices for Bihar compared with Tamil Nadu were in the range of 1.01
to 22.50. For 50% of the analysed drugs, the price ratio was more than 2, that is,
Bihar’s procurement system was procuring the same medicines at more than twice
the prices paid by Tamil Nadu.
Conclusion: Centralized, automated pooled procurement models like that of
Tamil Nadu are key to achieving the best procurement prices and highest possible
access to medicines.
Description
Keywords
Access to medicines, medicine availability, medicine prices, pooled procurement
Citation
WHO South-East Asia Journal of Public Health 2015;4(1&2): 78-85.