Health chiefs commit to update procurement with lessons from Covid

6 March 2023

Australia’s Department of Health and Aged Care (DHAC) has committed to updating procurement practices following the Covid-19 pandemic. 

In its response to a review of vaccine and treatment procurement, the government said it took on board “significant learnings from undertaking procurement during the peak of the pandemic”.

The review recommended procurement practices be upgraded in response to new knowledge about risk and supply and demand.

DHAC said it would update procurement practices to bear in mind “significant learnings from undertaking procurement during the peak of the pandemic”.

“Internationally competitive markets, relatively small international volume purchases and the level of urgency of supply resulted in a risk appetite different to normal procurement practices,” said DHAC.

DHAC added new practices would take into account the “shifts in the commercial and epidemiological environment that influence procurement activities”.

“Future advance purchase agreements (APAs) will need to be negotiated based on emerging conditions both in Australia and abroad,” added the report.

“Ideally this will result in APAs that are more flexible and tailored to needs of the Australian population.”

It said the government hoped to new encourage the development of onshore manufacturing facilities for mRNA vaccines, which would affect vaccine supply and availability.

The government said it would review logistics arrangements for Covid-19 vaccines to test value-for-money and reduce wastage while ensuring timely access.

“A number of operational changes to the Covid-19 vaccine rollout are being implemented,” said DHAC.

“These changes are designed to improve value and cost efficiency by streamlining distribution logistics and optimising the use of existing distribution pathways including those of state and territory governments.” 

Among the changes was reducing spending on logistics by shifting from two logistics providers to one.

DHAC said it also believed costs would be further reduced and efficiency increased when responsibility for vaccine storage and logistics transitions to state and territory governments in late 2023.

And it agreed with a further recommendation to urgently develop new mechanisms to manage stock held by the National Medical Stockpile.

This would enable greater transparency about inventory, DHAC said.

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