NTA Level 5 • Semester 1 • PST05101

The Prime Vendor System

Medicines and Medical Supplies Management • Source Session/Topic 15

Full source-text version: all educational wording from the extracted learning source is retained; only presenter/tutor metadata and web-layout noise are removed, while formatting is improved for readability.

Session 15: The Prime Vendor System

Total Session Time: 120 minutes

Prerequisites

• None

Learning Tasks

By the end of this session students are expected to be able to:

• Explain the prime vendor system

Resources Needed:

• Flip charts, marker pens, and masking tape

• Black/white board and chalk/whiteboard markers

SESSION OVERVIEW

SESSION CONTENTS

STEP 1: Presentation of Session Title and Learning Tasks (5 minutes)

READ or ASK students to read the learning tasks and clarify

ASK students if they have any questions before continuing.

STEP 2: Definitions of Vendor, Prime Vendor System (10 minutes)

Vendor

• Is a person or organization that vends or sells liable/ dependent

labor or service

• Specifically vendor can be an independent consultant, a consulting

company or staffing company

• Can also be called a supplier because they supply the labor or

expertise

Prime vendor system (PVS)

• Is a contracting process that provides commercial products to

customers from commercial distributors whereby customer typically

receive material delivery through the vendor’s commercial distribution

system

STEP 3: The Need for Primary Vendor System (25 minutes)

|Activity: Buzzing (5minutes) |

| |

|ASK students to pair up and buzz on the following question for 3 |

|minutes |

| |

|Why do we the need for Primary Vendor System? |

| |

|ALLOW few pairs to respond on the question and let other pairs add on |

|points not mentioned WRITE their response on the flip chart/board |

| |

|CLARIFY and SUMMARIZE by using the content below |

• Stock-outs of medicines affect quality of care and discourage patients

to enroll in the Community Health Fund (CHF) and other insurance

schemes. Medical Stores Department (MSD) is the backbone for public

medicines supply in Tanzania. But they face challenges in filling

orders of health facilities

• In the last few years, this supply gap has been growing and reached

over 40% of orders.

• Normally, health facilities fill this gap with purchases using

complementary funds such as from community health fund (CHF), national

health insurance fund (NHIF), user fees and donor basket funds.

Procurement is done from multiple private sources within and outside

their district and region; incurring in the process high opportunity

costs (travel and fuel, per diems, high prices of medicines they

purchase). The procedure is uneconomic, bureaucratic, in transparent,

and lengthy and supplies are of questionable quality.

The Jazia Primary Vendor System

• The Jazia Primary Vendor System concept is described under the

bilateral governmental agreement between the governments of Tanzania

and Switzerland, signed by MoHCDGEC and PO-RALG

• The Jazia PVS does not replace MSD but serves as a supplementary

source for medicines and supplies out of stock or short supplied or

not stocked by MSD

• The Jazia PVS serves as a safety net to the region in case of stock

falling-out at MSD and/or an unexpected spike in demand without

compromising quality or price

• .

• The contracted Prime Vendor maintains sufficient stock level to meet

supply shortfalls experienced from MSD.

STEP 4: Financing for PVS (25 minutes)

Financing

• Health facilities (HF) have two main sources of funding for their

supplies:

o Direct funding deposited at MSD by the Ministry of Finance (MoF)

through the MoHCDGEC and;

o Supplementary funds collected by and/or residing at health

facility level. These include: CHF, NHIF, cost sharing/user fees

and donor health basket funds. At health facility level,

complementary funds are managed by the Health Facility Governing

Committee (HFGC). 67% of CHF revenue is dedicated to the purchase

of supplementary medicines by health facilities.

• Health facilities (HF) formerly used these funds to purchase from

multiple private sources. However, now this supplementary source is

used for purchases exclusively from the appointed Prime Vendor (PV)

• Districts pool their demand for supplementary medicine at the regional

level, benefitting from lower prices (economies of scale). Prices from

the contracted PV are fixed and comparable to MSD prices

• This allows health facilities to manage their own funds following

standard operating procedures (SOP) hence enhancing fiscal

decentralization. Funds are used for joint purchase from the PV, based

on a public-private-partnership (PPP) framework contract.

STEP 5: Strategy for PVS (35 minutes)

|Activity: Small Group Discussion ( 15 minutes) |

| |

|DIVIDE students into manageable groups |

| |

|ASK students to discuss in groups on the following question: |

| |

|What is the strategy for PVS? |

| |

|ALLOW students to discuss for 15 minutes |

| |

|ALLOW each groups to present |

| |

|CLARIFY and SUMMARIZE by using the contents below |

Strategy of appointing primary vendor

• Medical Stores Department (MSD) is the backbone for public medicines

supply in Tanzania. But they face challenges in filling orders of

health facilities. The supply gap of more than 40% stemming from the

out-of-stock situation and low order fulfillment rates for supplies by

MSD needs to be complemented by medicines from other sources

• Districts may purchase from private suppliers in case of stock-out at

MSD upon its approval. However, this procedure is lacking consistency

and transparency, The current procedure is bureaucratic and

uneconomic, and it prolongs lead-time for delivery of supplies

PVS established in Dodoma region

• To tackle the problem of medicine stock-outs the Dodoma Regional

Administration and Local Government (RALG) decided to pilot a new

strategy establishing a Public-Private Partnership (PPP) with a

private sector pharmaceutical supplier

• This unique Prime Vendor System (PVS) has the objective to ensure that

health facilities have the medicines and medical supplies to meet the

needs of the people. The PPP supplements the regular government supply

with additional supplies from a single vendor in a pooled regional

approach. All complementary purchases from health facilities are

consolidated at the district level and forwarded to the Prime Vendor

• In principle, the PVS established in Dodoma region serves as a “one

stop shop” intended to alleviate opportunity costs previously incurred

by health facilities when they have to search for alternative sources

of supplies they could not obtain from MSD.

• Primary Vendor’s supplies are of assured efficacy, safety and quality

in accordance with MoHCDGEC and Tanzania Food and Drug Authority

(TFDA) standards.

STEP 6: Key Points (10 minutes)

• Prime vendor system is a contracting process that provides commercial

products to customers from commercial distributors whereby customer

typically receive material delivery through the vendor’s commercial

distribution system

• The need for PVS is due to medicines supply gap. Medical Stores

Department (MSD) is the backbone for public medicines supply in

Tanzania. But they face challenges in filling orders of health

facilities. Stock-outs of medicines affect quality of care

and discourage patients to enroll in the Community Health Fund (CHF)

and other insurance schemes

• To tackle the problem of medicine stock-outs the Dodoma Regional

Administration and Local Government (RALG) decided to pilot a new

strategy establishing a Public-Private Partnership (PPP) with a

private sector pharmaceutical supplier

• The PVS does not replace MSD but serves as a supplementary source for

medicines and supplies out of stock or short supplied or not stocked

by MSD

• The PVS has the objective to ensure that health facilities have the

medicines and medical supplies to meet the needs of the people. The

PPP supplements the regular government supply with additional supplies

from a single vendor in a pooled regional approach. All complementary

purchases from health facilities are consolidated at the district

level and forwarded to the Prime Vendor

STEP 7: Evaluation (10 minutes)

• What is the definition of prime vendor system?

• What explanations can you give on PVS?

References

www.jaziaprimevendor.or.tz

World Health Organization (WHO), Regional Office for Africa

Brazzaville 2004, Management of Drugs at Health Centre Level Training

Manual.

United Republic of Tanzania Ministry of Health and Social Welfare,

Strategy for Development and Implementation of an Integrated Logistics

System for Essential Health Commodities: Government Printers, Dar es

Salaam

← Previous Topic Next Topic →View all Medicines and Medical Supplies Management topics Open Complete Full Notes

PDF / OFFLINE NOTES

Unataka kutumiwa notes hizi kupitia WhatsApp?Kwa notes zilizopangiliwa vizuri kwa kusoma offline au PDF, bonyeza kitufe hapa chini. Ujumbe wenye Level, Semester, Module na Topic utaandaliwa moja kwa moja.TUMIWA NOTES WHATSAPP

WhatsApp: 255620339260