Shaping Pharmaceutical Tenders for Effectiveness and Sustainability in Countries with Expanding Healthcare Coverage

Policy makers in countries, aiming to build and expand their healthcare systems and coverage, need effective procedures to support the most efficient use of limited financial resources. Tendering is commonly deployed to minimize and fix the purchasing price for the contract duration, especially for off-patent pharmaceuticals. While tenders can reduce acquisition costs, they may also expose the healthcare systems to risks including drug shortages, quality trade-offs, and ultimately, compromised patient health outcomes. Careful planning is therefore required. The effectiveness and impact of tendering were examined in different healthcare settings to establish good tender practices and to develop guidance for tender stakeholders in countries with expanding healthcare coverage for the effective conduct. The literature was reviewed for tender practices and outcomes in all countries, and tender experts from one multi-national pharmaceutical company in 17 countries with expanding healthcare coverage were surveyed on current tender practices. Tendering is a common practice for multisource pharmaceuticals in most countries worldwide. However, countries with expanding healthcare coverage specifically are vulnerable to the risks of defective tendering practices. Risk factors include non-transparent tender practices, a lack of consistency, unclear tender award criteria, a focus on lowest price only, single-winner tendering, and generally, a lack of impact monitoring. If well planned, managed, and conducted, tenders can be advantageous. Countries with expanding healthcare coverage should approach tenders strategically to achieve the desired improvements in healthcare. The good tender practices derived from this study may guide policy makers and purchasers in countries with expanding healthcare coverage on how to expand access to healthcare at an affordable cost. These include the use of multiple selection criteria and performance monitoring. Plain Language Summary Decision makers in countries aiming to expand their healthcare systems must best use the limited money available for healthcare. Tendering is commonly deployed for pharmaceuticals produced by multiple manufacturers (so-called multisource pharmaceuticals), to choose the product with the lowest price. Through tenders, purchasers request offers from suppliers for the needed products. The ultimate purpose of our research was to develop a guidance on robust tender processes. Therefore, we reviewed the literature to examine the effectiveness and impact of current tendering practices. In addition, we conducted a survey among tender experts from one pharmaceutical company in 17 countries with expanding healthcare coverage. In both the survey and the literature review, we confirmed that worldwide, tendering is a common practice for multisource pharmaceuticals. However, defective tendering practices may increase the vulnerability for some risks including abuse due to intransparent processes, lack of consistency, unclear tender award criteria, a focus on lowest price only, single winner tendering, and generally, a lack of impact monitoring after the end of the tender process. Hence, tenders must be well planned, managed, and conducted to be advantageous. Countries with defined and transparent tender frameworks and processes will be better equipped to achieve the desired improvements in the healthcare systems. ‘Good tender practices’ include the clear definition of requirements to be used as selection criteria in addition to acquisition costs, and for monitoring of the tender success. ‘Good tender practices’ may help to manage cost and improve healthcare at the same time. ELECTRONIC SUPPLEMENTARY MATERIAL: The online version of this article (10.1007/s40258-018-0405-7) contains supplementary material, which is available to authorized users.