Definition Procurement is the process of obtaining/acquiring supplies and services and can achieved through purchase (buy), manufacture

in-house (from available materials), receive donation (in kinds), agencies W !, "#$%&' or bilateral aid program also this may occurs in cycles, as long as need persists to consume the supplies and services Pharmaceutical procurement is particularly prone to poor governance, as it entails comple( process, )hich involves several stakeholders including government ministries, manufactures, hospitals, and other distributors* When pharmaceutical procurement and supply chain systems )ork effectively they offer high levels of quality cost effectiveness, product availability, transparency, accountability and value for money in the use of public funds* PHARMACEUTICAL PROCUREMENT IN TANZANIA. Pharmaceutical procurement process in +an,ania may occur at different service level (%entral -edical .tore, ealth faculties, Private pharmacy, distribuors etc) so at each level may use different types of procurement depend upon on the policy system e(ist* /ll pharmaceutical procurement method at any lever of the health system fall into one of the basic categories0 !pen tender, restricted tender, competitive negotiation and direct procurement* o) ever each of these methods can be used )ith any of the standard purchasing models 1 annual, scheduled, or perpetual revie)* CENTRAL MEDICAL STORE /t the %entral -edical .tore procurement of essential medicines and all other category of product are procured by the -.D +ender 2oard* +he tender board membership is comprised of people )ith different qualifications including, Pharmacists, 'inancial e(pert, -aterial -anagement staff and 3ogisticians* .o this may result into the central buying unit manages the purchase on behalf of member* -ost essential medicines and supplies stocked at -.D are procured by tender through $nternational %ompetitive 2idding, #ational competitive bidding, #egotiated tender, selective bidding, direct procurement and shopping* .o the %entral -edical .tore have the duties of to procure and distribute to all health facilities in +an,ania*

PUBLIC HEALTH FACILITIES +hose public health facilities dra) their requirements from -.D either through their respective funds deposited at a -.D direct by -! .W or by direct purchase using their o)n funds froma other sources including government basket funds* +hose )ho participate in procurements are .upplier officer, Pharmacist or 4% coordinator, %linical officer, head of facility depending on the facility in question* HOSPITALS: +he ordering mechanism for essential drugs is as follo)s0 ospital and D-!5s procure directly from the -.D on a cash and carry basis* +his is undertaken by entering a ,onal store and procuring items in stock based on their amount on their account or cash on hand* .o kits are planned on annual basis together )ith -! .W are procured and distributed according to this plan HEALH CENTRES AND DISPENSARY $ndent and $3. orders are in Principle the same, )here Primary ealth 'acility fill in an individual order (4 6 4) report )hich have a list of all essential medicines according to health facilities level, ('orm 7/, 'orm 72 and 7%) this is for dispensary, health center and ospital respectiely and send to D-! )ho channel it to -.D )here it is packed individually and shipped to the D-! )ith P ' name on the bo(* $t is then transported to the P ' by the D-!* +his )as done on quarterly basis 2ut no) -.D try doing a P$3!+ study of direct delivery services to the ealth 'acilitis

Role MOH Central: Forecast needs Allocate central funds Supervise

MOH Programme Managers

Flo! o" s#pplies Flo! o" orders

MSD Central/Zonal: Procure Store Distribute

MSD Central and Zonal Stores via MSD or hospital vehicle via MSD vehicle

Hospitals : Serve clients Prepare hospital orders and funding Districts: Revie# $ approve dispensar% and health center orders Allocate local funds Deliver to facilities Store supplies in transit Dispensaries & Health Centers: Serve clients Prepare orders Collect local funds

Hospitals (Government/FBO/ NGO via district vehicle Government Dispensaries and Health Centers

District

via district or N!" vehicle NGO Dispensaries and Health Centers

CLIEN S

Vertical pr !ra""e: Procurement of vertical programme drugs is carried out partly by -.D and partly by e(ternal procurement agents like %ro)n /gents and "#$%&' that is are procured only under special request by the respective programme* .o the -! .W and programs mobili,e enough funds from the government or development partners or both and deposit the same to -.D )hich in turn advertise tender,

/ll vertical programme under the -! .W in +an,ania use -.D for storage and distribution of their $tems* +he -.D utili,es the same storage and distribution net)ork for vertical programme items as is used for essential drugs that is its $+ system, personnel, )arehouse , trucks, etc, .o it )as the duty of programme manager or district coordinator to fill all the order report (464) and submit them to -.D for processing* Pri#ate $%pplier: Private )holesalers operate under the simple mechanism of procuring items and selling them )ith mark up covering the cost of the operation as )ell as profit* +he prices of private )holesale are not regulated by the government but the selection of medicines is limited to drugs registered under the +'D/* .o some health facilities, procure medicines and supplies from private pharmaceutical )holesalers and private pharmacies* +his )ill happen after the items )ere out of stock from -.D so can be procured through quotation basis or vendor system depend on )hich system e(ists at that district or regional level* A!e&cie$ ' D &ati &: /lso sometime hospitals, health centers and dispensary may get assistance of pharmaceutical products from the donors or /gencies such as W ! and "#$%&'* 2ut this assistance of pharmaceutical products should comply )ith the list of #ational &ssential Drugs according to the level of services and .tandard +reatment 8uideline* OB(ECTIVES OF )OOD PROCUREMENT PRACTICE Procure the right drugs in the right quantities at the lo)est possible total cost* +his may help to reduce the occurrence of drug resistance and the over stock of the products .elect reliable suppliers of quality products* .upplier should be fle(ible and able to provide service and satisfy the need of the customer*

 &nsure timely delivery and notification* .upplier should be able to delivery the service on time and according to the planned schedule and contract made* +his may increase the sustainability of pharmaceutical product

E*AMPLES OF )OOD PHARMACEUTICAL PROCUREMENT PRACTICE 8eneric name0 /l)ays )e use generic names ($nternational #on-Proprietary name, $##) for fair competition* .o )e need to specify 9uality .tandards, not specific brands, for drugs )ith bioavailability problems* .ince this emphasi,e the #&&D to reduce cost via generic purchase*

3imited to essential medicines list or formulary list0 +his can be done by .elect .afe, &ffective, %ost-effective drugs* .ince )e cant buy every thing in a real situation* /lso )hen required, use formal approval procedures for procurement of non-listed medicines 2ulk purchases0 %oncentrate purchases on limited 3ist to increase quantities, reduce price also )e need to specify divided deliveries 'ormal supplier qualification and monitoring* "se formal supplier qualification based on medicine quality, service reliability, and financial viability* +his may help to the service to be standard and smooth oriented )ith minimal resistance /pprove suppliers before tendering (Prequalification) or after (Postqualification) this may be done by using a formal -onitoring .ystem to &nsure continued supplier qualification*

 %ompetitive bidding process* "se %ompetitive bidding on all but very small or &mergency purchases to obtain the best prices* $n 4estrictive tender, only prequalified suppliers should be allo)ed to compete* $n !pen tenders, suppliers must be evaluated after submission of bids* %ommitment to a sole source0 Procure all contracted medicines only from )inning suppliers* Do not enter into any separate deals )ith non-contracted suppliers* $f you do so it may reach a point they )ill sell to us at high price or even high chance of corruption to occur EFFICIENT AND TRANSPARENCY PHARMACEUTICAL PROCUREMENT. $t may happen in system )hereby all duties of procurement of pharmaceutical material )ere done by one person or one office* +hese duties such as product selection, forecasting, product specification etc all these )ere done by one individual person or office* +his may result into people using this loop hole being engage in corruption activities* .o it should better if different procurement and supply management activities and responsibilities should be divided among different offices, committees and individual, each )ith appropriate e(pertise and resources for specific function* /lso in most of public sector conte(t the reality is that all function of the drug procurement process are entirely in the hand of one office or official* .o )ithout appropriate separation of function and authority the procurement process is much more susceptible to influence by special interest* +his may result into procurement personnel may be able to bias drug selection, manipulate orders to increase the quantities, pre:udice supplier qualification decisions, manipulate the final a)ard tender and slant product specification to limit competition* .eparations of key functions contribute to professionalism accountability and efficient procurement system* /lso in a system )here by management may not )ant a computeri,ed system in order for the benefit of people* +his may result into a system being not efficient in using their

resource since people may use this loop hole to benefit themselves* .o it )as advisable to have a procurement and supply management activities that are )ell planned and performance to be monitored regularly* &very thing conducted in procurement should be reported* +he organi,ation should make sure that efficient and reliable information management system should be in place this may help to track the flo) of product in the system* */lso it is required even once a year the procurement department be audited by e(ternal auditor and audit report issued