Collective effort progresses HSV’s pharmaceutical procurement strategy

Working groups comprising HSV’s Pharmaceutical Sourcing team and health services representatives have progressed a series of initiatives identified as part of the pharmaceutical procurement strategy workshops last year.

The working groups were formed after the first workshop in May 2024 in which attendees reviewed state spending and identified 14 areas of opportunity to deliver statewide commercial, patient care and operational benefits. These 14 areas were refined to seven opportunities, with each one assigned to a working group for further exploration.

The groups met to grade their assigned opportunity according to its complexity and potential benefit before presenting their findings at a second pharmaceutical procurement strategy workshop in October.

The seven opportunities identified were:

• contracting Special Access Scheme and section 19A products
• therapeutic group tenders for therapeutically interchangeable medications
• better quality data,
• commercial value-add levers such as rebates based on state volume
• tendering on non-pharmaceutical capital expenditure
• developing an online portal for stock sharing between health services
• leveraging patent suppliers for pharmaceutical benefits scheme opportunities.

Of these, therapeutic group tenders, capital expenditure and sharing excess stock were identified as offering the greatest benefits to health services.

The list of priorities will now be assessed by the HSV Pharmaceutical Sourcing team and presented to the relevant reference groups for endorsement within the next 12-18 months. A number will be incorporated into the upcoming pharmaceutical products tender, while others will be approved for inclusion in the FY26:H2 Procurement Activity Plan (PAP) or as standalone activities.

The pharmaceutical strategy workshops provided a valuable opportunity for the sector to get together in person and brainstorm ideas for how HSV can deliver better value through our pharmaceutical contracts, says HSV Head of Pharmaceutical Sourcing Jasmine Makin.

“The collaboration has opened the door for increased engagement with health services. It’s been very positive.”

Health services have previously said they found the workshops valuable both as a way to provide input and to learn more about the opportunities that exist through HSV.

Peninsula Health’s Director of Pharmacy Nick Jones says the workshops were an effective way to harness the creative ideas and expertise in the room.

“It was helpful that HSV engaged with us to identify opportunities in what is a difficult environment in which to identify extra value,” he says.

“The HSV Pharmaceutical Sourcing team has a great understanding of process and the commercial aspects, while the pharmacists brought deep expertise in medications and the practical implications,” he says.

“It was important to have both groups in the room.”

Royal Melbourne Hospital’s Lead Business and Medication Strategy Pharmacist Poppy Savage said the workshops were a good opportunity to think outside the box and look at opportunities for both cost savings and efficiency benefits.

“It’s not just medicines that we have to buy. Common consumables used by pharmacies such as fridges and printers are opportunities that HSV could potentially help with. We are all buying the same things and it’s a lot of duplication of effort,” she says.

Overall, the initiatives have the potential to realise up to $10 million in commercial benefits across a five-year period, says Jasmine.

“They also have the potential to improve processes and reduce the administrative burden for health services,” she says.

“We would like to thank our working group participants for their vital input into our statewide pharmaceutical procurement strategy.”