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Medicines Procurement and Supply Chain (MPSC) frameworks

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Topics: Policy, Commissioning and ManagerialProcurementTrusts

Procurement of medicines and services is undertaken nationally in England by Medicines Procurement and Supply Chain (MPSC) frameworks.

This article forms part of a series
  1. Procurement of medicines and services for NHS secondary care
    1. Medicines Procurement and Supply Chain (MPSC) frameworks
    2. Procurement of branded medicines within the tranche system
    3. Regional procurement of pharmacy products and services in England
    4. NHS pharmacy procurement in Scotland, Wales and Northern Ireland
    5. Net Zero and Social Value requirements in NHSE medicines tenders

Contents

  1. Managing medicines prices
  2. Maintaining competitive pricing
  3. Reasons for non-contracted medicines
  4. Implementing contracts
  5. Monitoring framework effectiveness
  6. Licensed medicines
  7. Generic medicines frameworks
    1. Generic medicines used in hospital
    2. Generic medicines used in primary care
    3. Clozapine
    4. Sevoflurane
  9. Branded medicines frameworks
    1. Tranche medicines
    2. National branded category
    3. Intravenous fluids
    4. Influenza vaccine
    5. Aseptically prepared chemotherapy and monoclonal antibodies for cancer
    6. Low molecular weight heparins and fondaparinux
    7. Hereditary angioedema
    8. Blood disorders including haemophilia A and B
  11. Patent-expiring medicines frameworks
  12. Update history

Managing medicines prices

The Medicines Procurement and Supply Chain (MPSC) is part of NHS England’s Medicines Value and Access directorate. The MPSC uses several strategies for managing NHS medicines prices to ensure value for money and to ensure resilience of supply. Tenders for medicines and services contracts in England are managed by the MPSC across the pharmacy purchasing groups. The configurations of purchasing groups are designed to maintain continuity of supply and avoid monopolies. For more information about the purchasing groups, see Procurement of medicines and services for NHS secondary care (SPS page).

Maintaining competitive pricing

The NHS ensures it purchases medicines at competitive prices, whilst ensuring the UK remains commercially attractive for pharmaceutical companies. The strategies employed to ensure that this balance is maintained include:

  • biannual benchmarking of branded medicine prices by the MPSC, National Procurement Delivery Group (NPDG) and the devolved nations
  • mid-contract price reviews by MPSC to align branded medicines prices with the best prices identified through benchmarking
  • horizon scanning to avoid awarding contracts just before significant changes in market prices, such as before an imminent patent expiry
  • contractual obligations requiring suppliers of generic medicines to reimburse trusts if a contracted medicine cannot be supplied and a higher price is paid to an alternative supplier, known as off-contract claims (for more information about off-contract claims, see the SPS webinar Everything you need to know about off-contract claims (SPS page))
  • a procedure for managing off-contract claims for generic medicines, agreed between Medicines UK and the Association of the British Pharmaceutical Industry (ABPI).

Reasons for non-contracted medicines

Most licensed medicines are tendered by MPSC in England and via the national procurement organisations in the devolved administrations.

There are a number of reasons why not all the medicines purchased by an NHS Trust have a contract (that is, they do not have 100% contract coverage). The reasons may include:

  • no bid has been received on a tender
  • a bid has been received but the medicine fails on quality
  • a bid has been received but the medicine does not meet the specification
  • the supplier has withdrawn their bid or has not accepted an award
  • the supplier has terminated an award because of production or other issues
  • an award has not been made because MPSC does not award when there is no economic advantage (for example a supplier may offer a 2% discount through a direct supply in response to a tender but there is a better discount available through wholesalers)
  • a confidential patient access scheme or other commercial arrangement with NHS England or NICE is in place
  • NHS England does not commission the use of the medicine

Implementing contracts

Trusts are responsible for implementing contracts after an MPSC award. Authorised NHS pharmacy staff can view all details of the contracts including price, via the MPSC web catalogue.

Some medicines are subject to further quality assurance checks. Details of packaging and labelling of awarded lines are assessed by the NHS SPS Quality Assurance (QA) team and can be found on PharmaQC (restricted to NHS pharmacy staff, authorisation and registration required). Medicines safety bulletins are shared with Trusts and include details of each generic tender.

Monitoring framework effectiveness

Trusts can audit and monitor their use of MPSC frameworks by accessing a monthly contract variance report via the RxInfo Exend+ system. This report identifies any contract implementation issues and missed savings opportunities, and also assists with identifying off-contract claims, which can help Trusts to optimise their medicines spend.

MPSC collects purchasing data from every NHS Trust in England to inform future procurement exercises and produce savings calculators for the medicines frameworks. Each Trust submits this data each month via the MPSC’s ‘PharmEx’ database, including drug descriptions, pack sizes, prices paid, and volumes purchased.

Licensed medicines

The MPSC provides frameworks for the NHS to use in order to purchase their medicines within standard terms and conditions. MPSC frameworks are agreements made between the MPSC and suppliers. Each framework establishes the terms and prices for future contracts for specific medicines that can then be awarded by NHS organisations. The size of the medicines framework is determined by the characteristics, dynamics and risks associated with each category.

MPSC tenders for the majority of licensed medicines used in NHS secondary care. This means that local procurement hubs should not be tendering for these categories of medicines. Licensed medicines are split into a number of categories, as described below.

Generic medicines frameworks

The following categories of generic medicines are managed by the MPSC Generics team.

Generic medicines used in hospital

Generic medicines that are predominantly used in the hospital sector, for example, injectable medicines.

Length of framework

Variable up to 2 years

Scope of framework

There are 3 frameworks each covering a third (33%) of England. Each framework may be divided into the 2 purchasing groups within the super region and products will be awarded to the purchasing group or super region. The article  Procurement of medicines and services for NHS secondary care (SPS page) explains the NHS procurement groups and regions.

Every 8 months, MPSC tenders for a different super region. Differing lengths of frameworks and where possible awards, will be made to different suppliers so that there is a sequential opportunity to re-tender the business, maintain diversity and foster competition.

Generic medicines used in primary care

Generic medicines of which less than 10% of the national demand is used in the hospital sector and more than 90% is used in primary care. This is often referred to as the orals (plus non-parenterals) product framework.

Length of framework

3 years

Scope of framework

National – whole of England (100%) awarded to one supplier

Clozapine

Length of framework

2 years

Scope of framework

National – whole of England (100%) awarded to multiple suppliers

Sevoflurane

Length of framework

2 years

Scope of framework

National – whole of England (100%) awarded to multiple suppliers

Branded medicines frameworks

The following categories are managed by the MPSC Branded team.

Tranche medicines

Branded medicines for which there is a competitive market including established biosimilars.

Length of framework

2 years

Size of framework contract

Two region awards:

  • North of England (NOFE) and Midlands and East (MAE)
  • London (LNW) and South of England (SOFE)

National branded category

Branded medicines with only one supplier and minimal therapeutic competition.

Length of framework

2 years

Scope of framework contract

England

Intravenous fluids

Length of framework

2 years

Scope of framework contract

England, awarded to multiple suppliers

Influenza vaccine

Length of framework

4 years

Scope of framework contract

England, awarded to multiple suppliers

Aseptically prepared chemotherapy and monoclonal antibodies for cancer

Length of framework

4 years

Scope of framework contract

North West England, North East and Yorkshire, East of England, London and South East Coast, awarded to multiple suppliers

Low molecular weight heparins and fondaparinux

Length of framework

2 years

Scope of framework contract

England

Hereditary angioedema

Length of framework

2 years

Scope of framework contract

England, Wales and Northern Ireland

Blood disorders including haemophilia A and B

Length of framework

4 years

Scope of framework contract

England, Scotland, Wales and Northern Ireland

Patent-expiring medicines frameworks

Patent-expiring medicines are medicines near or at patent expiry; also called transition medicines. These can include new generic medicines and new biosimilars to the UK market.

Length of framework

Variable because framework end dates and durations are agreed with the generics and branded teams to align with future workplans.

Scope of framework contract

England, but this can be divided up into purchasing groups or regions depending on the market situation.

Update history

  1. Republished
  2. Full update and review
  1. Published