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Ukraine’s Health Ministry continues reforming public procurement of medicines and healthcare products

26 October 2018

On October 25, the Ministry of Health registered SOE "Medical Procurements of Ukraine", which is eventually to become a central procurement agency. The enterprise will ensure the continued implementation of the reform of the national procurement of medicines and healthcare products, and the establishment of a public procurement expertise center.

The establishment of the SOE "Medical Procurements of Ukraine" is a further step in implementing the recently updated Concept of Reforming Procurement of Medicines and Medical Devices, and other Healthcare Products, which was approved by Resolution of the Cabinet of Ministers of Ukraine No. 528 dated August 23, 2017.

Under the Concept, there are three key options for providing patients with medicines and healthcare products: the reimbursement program, the inclusion of the medicines and medical devices used for care in the costs of medical services, and procurements by the Central Procurement Agency. The newly established state-owned enterprise will be responsible for the third program.

Currently, international organizations and specialized agencies support Ukraine in public procurement of medicines and healthcare products. Effective negotiations on prices, and direct agreements with manufacturers, allowed these organizations to significantly reduce the purchasing prices by an average of 39%, which, in turn, allowed the state to use the savings to purchase additional medicines to ensure that more patients receive necessary treatment.

"We should use the experience acquired in recent years, and create a strong, professional and efficient procurement organization. Today, we are making the first step in this direction, and, with the funding from the Global Fund, we are planning to implement several pilot projects in the near future," commented Olha Stefanyshyna, deputy Minister of Health of Ukraine.

To ensure that patients receive the necessary medicines in a timely manner, and that the medicines delivery processes are continuous, the SOE "Medical Procurement of Ukraine" will gradually implement the practices developed by our international partners. Starting in 2020, the enterprise will be able to become fully operational, and to conduct medical procurements for the state budget funds.

In future, the newly established state-owned enterprise will procure medicines and healthcare products included in the strategic programs (vaccines, infectious diseases), as well as expensive patented medicines. In addition, the enterprise will work on reducing prices for medicines and healthcare products in the Ukrainian market, aggregating local demand, making framework agreements, creating and maintaining electronic catalogs, and enhancing professionalism in the medical procurement field.

We also plan to introduce electronic catalogs of medicines and healthcare products, which will be similar to an online trading platform in the ProZorro system. This will allow health facilities and medical institutions to purchase medicines and healthcare products in the most convenient way, given that the bureaucratic burden will be removed.

The SOE "Medical Procurements of Ukraine" will be subordinated directly to the Ministry of Health of Ukraine. The control over the enterprise’s activities will be carried out by an independent supervisory board, which will consist of representatives from government bodies, international organizations, patient and anti-corruption organizations. This board is to be formed within the next 6 months. The efficiency, transparency, and accountability of the strategic purchaser of pharmaceuticals and other healthcare products will be ensured by its full compliance with the best corporate governance standards and practices.

In 2018, in addition to the implementation of pilot projects with the funding from the Global Fund, we plan to form the independent supervisory board, and to select Head of the SOE "Medical Procurement of Ukraine".

Currently, the work on reforming the procurement of medicines and healthcare products is being implemented with the support of our international partners, including the USAID (SAFEMed and TAPAS projects), the UNDP, the World Bank, the International Renaissance Foundation (IRF), and the Global Fund to Fight AIDS, Tuberculosis and Malaria.

Director General of the SOE "Medical Procurement of Ukraine" will be selected in an open and transparent competition. The vacancy announcement will be published in the near future.

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