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[e-drug] MSH Launches Pharmaceutical GPO in Kenya (4)

E-DRUG:  MSH Launches Pharmaceutical GPO in Kenya (4)
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Kirsten Myhr has expressed her concerns about the posting from MSH about this 
new MSH for profit venture in Kenya. I do wonder if this activity is seen as a 
new way of making essential medicines available to people who need them. We 
know that in many countries the public sector has low availability and so 
patients often have to go to the private sector and pay unaffordable prices.

Will this MedSource initiative make things better? We need to know more than is 
currently posted on their website. (https://www.medsource-group.com/) 

It is not clear which medicines will be supplied? Will it be only essential 
medicines? Or primarily essential medicines? The model if it works would mean 
that purchasers obtain their purchases at lower prices. But will these lower 
prices translate into improved affordability for patients or increased 
profitability for the vendors?

Is this a sole source supplier model in which members are obliged to purchase 
products only from MedSource? 
I was concerned with the answer to the question "What is my obligation to 
MedSource?" 

The answer in the FAQ section of the website reads:
'The MedSource program includes exclusive and committed participation and 
purchases from its members. This means suppliers can expect to gain market 
share when they are able to provide MedSource with the most competitive 
pricing. This approach provides increased volume to suppliers that are willing 
to provide the greatest savings.'

'Membership in our program includes confidentiality and therefore, your 
existing suppliers should not be provided with our contract pricing in an 
effort to 'meet or beat' our pricing.' 
(It is not unusual that suppliers in fear of losing business are anxious to 
lower pricing when that business is threatened rather than have given you 
better pricing all along.)

'High compliance from our membership with purchasing MedSource products and 
services is needed for MedSource to continue offering additional products and 
hopefully larger discounts.'

This sounds to me like a sole source supplier agreement without transparency. 
What is also not clear to me is whether MedSource will compete with KEMSA or 
MEDS in the public and Faith Based markets. With decentralization counties have 
the authority to buy out and are not required to purchase from KEMSA. 

Finally if this is a for profit venture where do the profits go? To MSH? Or 
where?

More answers are need.

Richard Laing
Professor, Department of  Global Health
Boston University School of Public Health,
801 Massachusetts Avenue Boston MA 02118
E mail richardl@bu.edu
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