Agreement with Smith and Nephew Limited (S&N) for the supply of orthopaedic trauma implants

20 June 2016

Hospital devices Decision

PHARMAC is pleased to announce the approval of an agreement with Smith and Nephew Limited (S&N) for the supply of orthopaedic trauma implants and associated products.

This was the subject of a consultation letter dated 29 April 2016 which can be found on PHARMAC’s website.

In summary, the effect of the decision is that:

A range of orthopaedic trauma implants will be listed in Section H, Part III, (‘Optional Pharmaceuticals’) of the Pharmaceutical Schedule from 1 July 2016.
DHB hospitals can purchase these items directly from S&N.
There are estimated savings to DHBs that currently use these products of approximately $220,000 per annum nationally, based on current usage.

Details of the decision

Following PHARMACs consultation in 2013 it approached known suppliers of trauma, spine and CMF implants to request proposals for Schedule listings for their ranges. S&N responded with a proposal to list their trauma range of orthopaedic implants. PHARMAC has entered into an agreement with S&N for the supply of their orthopaedic trauma implants to be listed on the Pharmaceutical Schedule. This means that DHB hospitals may purchase these products under the national agreement at the contracted pricing.

The list of products will be available on PHARMAC’s website in both a PDF document and an Excel spreadsheet.

The agreement is not exclusive. DHBs can continue to purchase other brands of orthopaedic trauma, implants at their discretion. DHBs purchasing Smith and Nephew products will do so under this agreement from 1 July 2016.

Educational services will be provided by S&N to DHB personnel on appropriate use of its orthopaedic trauma implants and will be arranged in a format and at times as agreed with individual DHBs.

The impact of this proposal on DHBs is relatively low as these products are already in use in DHBs.

Feedback received

PHARMAC appreciates all of the feedback that it has received and acknowledges the time people took to respond. All consultation responses received by 20 May 2016 were considered in their entirety in making a decision on the proposed changes. Most responses were supportive of the proposal. The following issues were raised in relation to specific aspects of the proposal:

Theme	Comment
One supplier was concerned it did not have an opportunity to offer a proposal as part of this process.	PHARMAC directly approached known orthopaedic suppliers and widely publicised its interest in this category. We received a number of approaches as a result. PHARMAC have recently released an RFP for the entire orthopaedic category and any supplier wishing to participate should do so via the GETS website. Deadline for proposals is 24 June 2016.
Savings opportunity clarification requested by a DHB.	The data set was re-validated to confirm impact to DHB, and this has been provided to DHB staff.

Theme

Comment

One supplier was concerned it did not have an opportunity to offer a proposal as part of this process.

PHARMAC directly approached known orthopaedic suppliers and widely publicised its interest in this category. We received a number of approaches as a result.

PHARMAC have recently released an RFP for the entire orthopaedic category and any supplier wishing to participate should do so via the GETS website. Deadline for proposals is 24 June 2016.

Savings opportunity clarification requested by a DHB.

The data set was re-validated to confirm impact to DHB, and this has been provided to DHB staff.

More information

If you have any questions about this decision you can email PHARMAC at enquiry@pharmac.govt.nz or call our toll free number (9 am to 5 pm, Monday to Friday) on 0800 66 00 50.