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£3.45m* savings delivery on syringes and needles

Wednesday 25 May 2016

The Shelford Group lead our £3.45m1 savings delivery on syringes and needles.

Whilst potentially significant savings opportunities were already on the table for the Shelford Group on syringes and needles, by moving their combined spend to lower cost alternative products via our route, together we recognised early on this was just the beginning.

As Gary Welch, Director of Procurement and Supply Chain at Oxford University Hospitals Foundation Trust and Chair of the Shelford Procurement Group explains “Whilst NHS Supply Chain’s Compare and Save Programme data2 identified some big savings opportunities for us, by moving to clinically acceptable alternatives,  the potential for leveraging this further was apparent - there had to be something more by combining our purchasing power with that of the National Provider”.

The process

In January 2016 it was agreed to undertake a competitive procurement arrangement, incorporating an eAuction, to drive savings across three product lines - Blunt Fill Needles, Blunt Fill Filter Needles and Catheter Tip Syringes. Underpinning the Operational Productivity Review by Lord Carter, this approach aimed to reduce spend by collaboration and consolidating purchasing power, moving to alternative products where clinically acceptable and supporting national procurement strategies.

At this same time, with new opportunities continually being investigated to increase savings potential, the Working Together Programme who have also successfully realised significant savings through their collective purchasing power and the aggregation and commitment of spend, via NHS Supply Chain – were brought on board.

The results

By combining the collective expertise and purchasing power of two leading NHS collaborations, totalling 16 trusts and supported by the National provider, £0.657m (47%)3 annual savings were secured across the collaboratives - by moving to three new suppliers across three product lines and based on a one year commitment. This added a further £50k (8%)2  savings potential on top of those that were already identified via the Compare and Save programme. But it hasn’t just ended there.

This has created wider competitive tension and market conditioning. To date multiple additional suppliers have since come back to us with new price reductions4, some as high as a 70%, that now take our running total of potential savings to £3.45m1 and counting. Importantly, these additional savings do not require any up front trust commitment and are now available nationally, supporting the NHS transparency agenda and work towards a single national pricing model for the NHS; a key objective which sits at the heart of NHS Supply Chain’s on-going wider strategic savings programme, across its multiple frameworks, working with the NHS Business Services Authority (NHSBSA).

Tony White, Procurement Director, Sheffield Teaching Hospitals NHS Foundation Trust and Working Together Programme member trust concludes “New and significant savings are out there and the success of this exercise clearly demonstrates by taking collaborative working to the next level they can be achieved and can change the market – we just have to be open to working differently.”

All national price reductions are now live and to support trusts an at-a-glance price ranking sheet will also be made available so supplier prices for these products can be reviewed quickly and with ease by customers.

For support in identifying and delivering savings across this and multiple other categories, please contact your Account Manager for more information.

1 The headline £3.45m savings are based on the savings breakdown detailed in asterisked points 2, 3 and 4
2 Compare and Save forecast savings are based on the previous 12 Months procurement purchased through NHS Supply Chain and based on moving each product (NPC) to its lowest cost comparable product (NPC) equivalent.
3 Projected annual savings figure based on an average price reduction for the 16 Shelford Group and Working Together Programme trusts of 47%, calculated based on the band 1 price of the primary product (i.e. the products currently used by Trusts) minus the band 1 price of the awarded product multiplied by the last 12 months actual quantity purchased.
4 National annualised price reductions now available from suppliers. Projected annual savings figure based on price reduction against current band 1 price, multiplied by the last 12 months actual quantity purchased.

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