PETALING JAYA: Academics and experts have welcomed a new procurement method for the purchase of medicines in government hospitals, announced by the finance minister in the 2020 Budget.
The Galen Centre for Health & Social Policy chief executive Azrul Khalib commended what he called an “excellent move”, saying it was part of the government’s commitment to ensure greater access to high-quality drugs.
He said the pool procurement approach, involving the three ministries, meant that the government has adopted the best possible approach to negotiate with the pharmaceutical companies.
“The large volume will help reduce prices of the medicines and drugs being procured.”
Klang MP Charles Santiago agreed, saying that this procurement method would save the government a lot of money.
“I’ve been harping on this for the past one year, asking the health, education and defence ministries to do common bulk-buying or have a common procurement policy, but they’ve only met once over the past one year,” he said.
He added that a deadline should be fixed and suggested that the mechanisms be made public.
“Make it a public discussion. All the tenders and everything must be done publicly,” he said.
Santiago also said the local generic medicine industry should be given priority in the tendering process as currently a large portion of the medicines in government hospitals are imported.
“With this approach, you’ll help to encourage the domestic generic medicine market to expand,” he said.
Institute for Democracy and Economic Affairs (IDEAS) director Laurence Todd also welcomed the move, adding that the government needed to concentrate its purchasing power to secure the best prices for medicines.
“In the long term, this is a better strategy than price controls.”
However, he argued that the success of this procurement method depended largely on effective implementation, including eliminating unnecessary processes and middle-men to secure the best prices.
Finance Minister Lim Guan Eng announced in the 2020 Budget that the government will centralise and combine the tender and procurement processes of RM500 million worth of medicines across hospitals under the health, education and defence ministries to generate savings from bulk purchases.