An update on PHARMAC s medical devices work. Andrew Davies, Manager of Device Funding

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1 An update on PHARMAC s medical devices work Andrew Davies, Manager of Device Funding

2 A selective history of PHARMAC s role community community hospital hospital medicines medical devices hospital cancer hospital cancer Widened responsibility for hospital medicines and new responsibility for medical devices

3 PHARMAC s long-term impact

4 Medical devices objectives Investment in new technology Balancing access with health gain and costeffectiveness Consistent national access with appropriate regional variation Best health outcomes Sustainable expenditure growth All decisions informed by consultation and clinical input

5 Current stages of PHARMAC s activity national contracting market share procurement investment management budget management Hospital medical devices - wound care - sutures - disposable laparoscopic devices - interventional cardiology - orthopaedic implants Hospital medicines Community medicines and devices Vaccines Hospital cancer medicines Haemophilia treatments

6 Market share procurement Suppliers offered an assured portion of the market for a period of time Generate greater level of competition so that further savings can be realised for DHBs DHBs required to buy the contracted product(s) within a readily substitutable subset of products Where appropriate, support provided to DHBs to allow a smooth transition into any new arrangements

7 Consulting on our approach Discussion document in April 2015 on our proposed approach to market share procurement Proposed that the wound care category be the first to progress to market share Feedback has helped refine our approach Represents our 6 th consultation on our medical devices activity Builds on earlier feedback we ve received and is a continuation of our commitment to transparency and open dialogue.

8 Summary of feedback received Some key themes: Many responders supported a multiple supplier model Challenge to the assumption that there is a high level of interchangeability between wound care brands Preference to categorise products by use not form Support for the wound care subcategories that we identified Levels of support required for DHBs to implement change

9 Wound Care Advisory Group Wound Care Advisory Group established 2014 Members nominated by the National Wound Care Society of New Zealand Provided advice to PHARMAC to assist us to: - categorise the diverse range of wound care products - understand in more details the various products and their uses - identify clinical risks and issues - explore options to standardise and rationalise ranges available in DHBs - explore market share options - identify areas where further specialist advice is required

10 Request for Proposals RFP for supply of various wound care products to DHB hospitals Issued this week via GETS and PHARMAC website Closes late October 2015 Open to all suppliers of wound care products Seeking proposals for up to 3 suppliers for each of the product types outlined in the RFP Schedule. Scenario 1: Single supplier with 20% DV limit Scenario 2: Dual supplier with 5% DV limit Scenario 3: Three supplier with 1% DV limit

11 Future activity Investment management: DHBs required to purchase from a defined range for specific whole categories. PHARMAC assesses, prioritises and invests in new technology with the assistance of clinical input. Budget management: Financial certainty PHARMAC manages an agreed budget. Significantly increased savings. It s important to note that these stages are some time away.

12 GS1 and PHARMAC Approximately 7,000 medical device items we have listed have GTIN codes We re supportive of a system that will adopt and use standards that help data sharing, promote accuracy, helps to improve safety and lower health costs.

13 Keeping you up to date Newsletters Device Advice: subscribe online at We welcome your feedback at anytime: us at

14 Questions?