Country Seeks to Increase Medical Equipment Procurement Transparency

ASTANA – The government is working hard and methodically to efficiently use funds and respect transparency in procuring medicine and medical equipment.

This issue was discussed at a meeting of the Public Council for the Protection of Patients’ Rights, chaired by Serikbol Mussinov, executive secretary of the Ministry of Healthcare.

“Health system modernisation is the main task of the Salamatty Kazakhstan state programme,” said Mussinov. “Once again, we saw the benefits of unified distribution in helping to ensure the availability of medicines under the Guaranteed Free Medical Care (GFMC) programme. According to SK-Pharmacy, in 2014, a strategic stabilisation fund was established and medications are now being purchased at single prices. The long term contractor’s scheme concluded on onerous conditions for the state, as its prior incarnation, has been eliminated.”

Since  2011, SK-Pharmacy has signed direct contracts totaling 18.5 billion tenge (US$100.3 million). This has saved 3.6 billion tenge (US$19.5 million). From 2009-2014, savings reached about 27 billion tenge (US$146.4 million). The nationwide distributor was designed to be a driving factor in the development of the domestic pharmaceutical industry. There are special preferences given to domestic producers provided by the programme for development of the national pharmaceutical industry under the State Programme of Accelerated Industrial and Innovative Development (SPAIID). As a result, over the five-year period, 58.3 billion tenge (US$316.1 million) worth of domestic products were purchased and their share in GFMC reached 75 percent.

The favourable investment climate in the country has attracted world famous pharmaceutical manufacturers. Polpharma and Pharmstandard have already invested about $150 million in the industry. Pharmaceutical giants such as Sanofi and Pfizer are planning to launch factories in Kazakhstan, according to the country’s officials. In order to attract large-scale direct investment in pharmaceuticals, new rules for long-term contracts will be approved.

The main goal of the government programme is decentralisation and the creation of a competitive environment for producing medical equipment. Decentralisation has clear principles: medical equipment worth up to five million tenge (US$27,100) is to be acquired by hospitals and equipment worth 5-50 million tenge (US$27,100-$271,000) is bought through the leasing system. At the same time, the state reserves the right to spend its budget on acquiring unique, high-value and high-tech medical equipment. In this case, it must comply with the rules of state and sectoral programmes.

Vice-Minister of Healthcare Bulat Tokezhanov said that KazMedTech helps attract investments to the country, protects domestic producers and stimulates the development of new industries.

Increasing transparency and efficiency in the procurement process will help save more than 20 billion tenge (US$108.4 million) of state funds.

The Public Council for the Protection of Patients’ Rights, including members of the Senate and the Mazhilis (the upper and the lower chambers of the Parliament), support this system of procurement of medicines and medical equipment. The system uses market principles.

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