EFPIA Publishes White Paper on Effectiveness of Public Procurement of Medicines in European Union

• 15/02/2022
• Articles

On 10 February 2022, the European Federation of Pharmaceutical Industries and Associations, EFPIA, published a series of recommendations for enhancing the efficiency of medicine procurement in the EU (see, attachment). EFPIA’s suggested improvements focus on three distinct types of public procurement rules and practices: 

• The traditional, all-purpose EU public procurement rules, chiefly Directive 2014/24/EU, that are relied on by governmental entities and hospitals to procure medicines and other health products from the private sector.
• The 2014 Joint Procurement Agreement to Procure Medical Countermeasures, a political agreement specifically designed to allow EU Member States to purchase jointly and voluntarily medical countermeasures for serious cross-border threats to health (the JPA). The legal basis for the JPA, Decision 1082/2013/EU, will be replaced by a proposed Regulation that will organise in a coherent fashion responses to such threats.
• Informal tendering processes relied on outside the strictures of Directive 2014/24/EU and its associated rules. In some countries, payors not bound by the established procurement rules run some form of competition for contracts that do not satisfy the standards of these rules.   

EFPIA’s recommendations seek to create best practices and increase the efficiency of the procurement procedures, but also bolster fair competition for its members.  They intend to cure the flaws revealed in market feedback obtained by EFPIA in a survey of tendering practices in 18 countries across the EU and the UK and include the following sensible steps: 

• Ensuring increased input from clinical experts in designing and reviewing tender procedures.
• Grouping only contract products that are fully interchangeable and therapeutically equivalent.
• Avoiding tender duplication.
• While seeking the best price, also aiming to reward quality. “Price-only” and “winner takes all” awards do not help to accomplish these objectives.
• Increasing transparency about the award of tenders, but, crucially, maintaining the confidentiality of prices in the interest of both the awarding entity and the tendering participants.
• Avoiding imbalanced contractual terms (e.g. by penalising suppliers for specific contractual faults, but failing to provide for concomitant offtake obligations). 

While also offering case studies of good practice, the EFPIA report is highly critical of the JPA whose application it says occasionally led to artificial shortages and a distortion of competition. For example, the aggregation of demand and stockpiling requirements may result in suppliers not being able to participate in tenders. EFPIA specifically cites the case of a call for tenders for medication to treat intensive care patients affected by the coronavirus.