Proposal to change the types of Alternative Commercial Proposals that may be submitted during consultation on the annual draft Invitation to Tender

Consultation Closed

PHARMAC is seeking feedback on a proposal to change the types of Alternative Commercial Proposals (ACPs) that may be submitted in response to consultation on the draft Annual multi-product tender.

In summary, the proposal would result in the removal of the option for suppliers to be awarded Hospital Supply Status as part of Alternative Commercial Proposals (ACPs).

Feedback sought

PHARMAC welcomes feedback on this proposal. To provide feedback, please submit it in writing by Friday, 01 July 2016 to:

Tender Analysts
PHARMAC
PO Box 10 254
Wellington 6143

Email: tender@pharmac.govt.nz
Fax:     04 460 4995

All feedback received before the closing date will be considered by PHARMAC’s Board (or its delegate) prior to making a decision on this proposal.

Feedback we receive is subject to the Official Information Act 1982 (OIA) and we will consider any request to have information withheld in accordance with our obligations under the OIA. Anyone providing feedback, whether on their own account or on behalf of an organisation, and whether in a personal or professional capacity, should be aware that the content of their feedback and their identity may need to be disclosed in response to an OIA request.

We are not able to treat any part of your feedback as confidential unless you specifically request that we do, and then only to the extent permissible under the OIA and other relevant laws and requirements. If you would like us to withhold any commercially sensitive, confidential proprietary, or personal information included in your submission, please clearly state this in your submission and identify the relevant sections of your submission that you would like it withheld.  PHARMAC will give due consideration to any such request.

Details of the proposal

From August 2016:

  • suppliers would no longer be invited to submit ACPs to tendering which proposed the award of Hospital Supply Status to any products.

The criteria stated in the Invitation to Tender Consultation document for ACPs would be amended as follows (additions in bold and deletions in strikethrough):

  • ACPs may include more than one line item and may include pharmaceuticals not listed in Schedule Two of the draft Tender;
  • ACPs may seek PHARMAC’s agreement to defer tendering or application of reference pricing for a period of time for any pharmaceutical, whether or not it is listed in Schedule Two of the draft Tender;
  • ACPs may propose PHARMAC awarding Hospital Supply Status for Hospital Pharmaceuticals included in Schedule Two but not for Hospital Pharmaceuticals that do not appear in Schedule Two;
  • ACPs may not propose awarding Sole Subsidised Supply Status in the community or Hospital Supply Status in DHB Hospitals;
  • PHARMAC reserves the right:
    • not to accept any ACPs; and/or
    • not to provide reasons for the acceptance or non-acceptance of any ACP; and/or
    • to enter into an agreement or arrangement that differs in a material respect from that envisaged in this letter.

Background

Every year in August, PHARMAC releases the draft Invitation to Tender documents and draft tender product list through the Invitation to Tender consultation. The 2015/16 Invitation to Tender consultation document can be viewed on PHARMAC’s website(external link). The consultation document seeks feedback on the draft Invitation to Tender document and the draft tender product list.

At the same time, PHARMAC also seeks ACPs to tendering that suppliers may wish to submit. An ACP may, for example, offer price reductions on one set of pharmaceuticals in return for PHARMAC agreeing to defer tendering on another group of pharmaceuticals for a period.

Previously, PHARMAC has allowed ACPs which propose PHARMAC awarding Hospital Supply Status for Hospital Pharmaceuticals included in the draft Invitation to Tender to a supplier for a period of exclusivity. Since 2012, PHARMAC has had a greater involvement in Section H (hospital medicines) and has worked to align Sections B and H. We now consider that it may be appropriate to align our approach so that the opportunity for market exclusivity in both the community and hospital settings is only offered following open competitive processes (e.g. RFPs or the annual Invitation to Tender).