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How to Thrive in the New Centralized Purchasing Schemes

By Miriam Bello | Wed, 01/27/2021 - 13:41

You can watch the video of this panel here.

The arrival of a new government administration brought significant changes to the public health model in Mexico. “Changes began in 2019 with the medicine purchasing scheme and eventually reached INSABI and the integration of UNOPS to the purchasing process,” explained Marco Ruggiero, General Manager of Chiesi Mexico, during Mexico Health Summit 2021’s panel How to Thrive in the New Centralized Purchasing Schemes on Wednesday, Jan. 27.

“The advantages I see is that having one centralized purchase increases transparency and compliance,” added Ruggiero. However, there are areas of opportunity in the litigation’s administrative processes. “During 2019 and 2020, there were no clear times for tenders, which affected our logistics planning and increased costs.” Ruggiero said that payment is also unclear. “There are laboratories that are still waiting for payment of 2019 medicine orders.”

According to José Luis Ortiz, Director General of Medistik, there are three key points to consider in the centralized purchasing scheme: efficient management systems, efficient transportation and efficient distribution of the demand. The combination of these three elements ensure an effective service for all health entities: however, this is a burden the public sector cannot bear alone. “The local and international industry has the capacity to distribute large orders and ship supplies to public distribution centers. However, to date, there are millions of pesos being lost due to the lack of organization in the public system,” said Ortiz. Collaboration with the private sector would also cut down bureaucratic processes as private companies use technology to optimize performance, he adds.

Carlos Gutiérrez Muñoz, Account and Sourcing Implementation Director of Christus CEI, said the local industry perfectly complies with the regulatory measures and quality to offer the best product, according to the standards of the centralized scheme. He recognized that such an initiative can help supply but it is risky to look for products outside the country.

Gutiérrez shared his concerns on the government underestimation of the logistic complexity of medicine distribution in the country. “Are they considering Mexico’s geography and the distribution to 22,000 facilities in metropolitan and rural areas? That implies distribution dangers, which increase costs. What is the point of saving costs on purchases by taking over distribution if the logistic costs will be larger due to inexperience?

All three experts gave their input on how to create a better system. “We need to create a dialog to generate a positive outcome and fair business strategies,” said Ruggiero. “We have one same goal, which is to treat patients and generate better outcomes.” Ruggiero’s main concern is Mexico risking supply due to a focus on price. “This approach is ignoring innovation and research investment.”

Gutiérrez said that collaboration in this sector should not be neglected. “We must not create a divide between public and private players. We all experience the same health ailments and regardless of the provider, the solution comes from one same industry,” he said. “After the pandemic, the challenge will be to maintain an efficient supply chain in the public sector. The private sector wants the chance to reach an agreement that will benefit not companies but the nation,” said Ortiz.

As the moderator of the panel, Benjamin Vega, Commercial Director of Allen Laboratories, concluded that the purchasing scheme is a national health matter. “Together, the public and private sector are able to create investment plans that will create tangible and real outcomes. It is not easy, as we are speaking of health. However, we must see this work as investment, rather than a cost or waste of money.”  


For more information about the subect, click here

Photo by:   Mexico Health Review
Miriam Bello Miriam Bello Journalist and Industry Analyst