A Reform On Medicine Procurement System Under

Universal Health Coverage In Indonesia

Yusi Anggriani, Prastuti Soewondo, John Langenbrunner
Health Working Group | National Team for Accelerating and Poverty Reduction (Tim Nasional Percepatan Penanggulangan Kemiskinan, TNP2K)
Contacts: yusi1777@yahoo.com; prastuti.s@gmail.com

Background

FORNAS & e-CATALOGUE

Since January 2014, Indonesia has implemented many reforms in its health care system
MOH
MOH
LKPP
Pharmaceutical
Pharmaceutical
DGs
moving toward Universal Health Coverage (Jaminan Kesehatan Nasional-JKN).
DGs
Price Setting
Tender &
The Ministry of Health (MOH) begun to implement two important reforms in
MOH Ceiling Price
Negotiation
Selection
pharmaceutical system in improving medicine procurement process:
1. Formularium Nasional (FORNAS)
Universal of registered products
(18000 medicines)
The new national formulary of medicine containing list of molecules
(starting on September 2013) aims to support rational use and cost effective.
e-Catalogue
2. E-Catalogue
A tool for e-procurement for which prices of products have been negotiated
FORNAS
785 medicines
centrally for 4 respected regions.
1200 medicines On November 2015

Pharma
Companies
Tender &
Negotiation
Supply
Facilities
Procurement
Reimbursement

Methods

Objective
The aim of this study is to explore
early experiences of different stakeholders after
implementation of these pharmaceutical
sector changes.

Qualitative method was conducted to understand perceptions of stakeholders on the major changes in
pharmaceutical sector focusing on the implementation of FORNAS and the e-Catalogue procurements system.
The information was obtained through in-depth interviews, focus group discussions and a consultative meeting
with government officials, clinicians, hospital administrators, academics, and pharmaceutical industries.

Results

Medicine Procurement Process

e-purchasing

Provincial Health Office

Hospital

Manual Procurement

Hospital
District
Health
Office

Distributor

Pharmaceutical
industries

LKPP
(INA-Procurement)

District HO

Medicine Availability Information

Prior to Implementation of JKN

2
1

4
5

National
Formulary
Ministry of Health

e-Catalogue
Implementation

Other medicines procurement

mechanism based on
Perpres 70/2012

Those who procure medicines appreciated

the e-Catalogue procurement system
because of its transparency.

Pharmaceutical company
representatives highlighted
the need to understand
how ceiling prices are set.

The e-Catalogue is perceived as Increasing Transparency

in the System

Statement from Pharmaceutical Industries:

MOH Ceiling Price (HPS) are Considered Too Low

e-Catalogue is transparent, everyone can go to the website. People can go to

e-Catalogues list to see the price. Without a tender process, we could buy drugs.
I think it is good. (Respondent from DHO)

... There are interests from the industry but the proposed prices are
above HPS. It seems that the tender will be repeated with the same
HPS again. There should be an evaluation on the determination of
HPS. (Pharma company A)

I strongly agree with this e-Catalogue, however there are obstacles that
we face in the implementation that should be solved. (Respondent from DHO)

National Public Procurement Agency

Indonesias geography presents

distribution challenges.
It is important that criteria for listing
a product in the e-Catalogue include
not only low prices, but also
documentation of product quality
and supply guarantees (related to
both volume and geography).

Medicine Provision

After the Implementation of JKN

Challenges on e-Catalogue Implementation

Under JKN Expansion
Medicines
Information
System

Statement from Other Stakeholders:

Distribution Cost Is Included
in The Product Price,
Relatively High Distribution Cost

e-Catalogue avoids negative influences, meaning there are no interventions. It is

more transparent. Before, we were worried about third parties that may interfere
with procurement, whether authorized or unauthorized.(Respondent from DHO)

... Pricing of HPS has to be reconsidered, how prices are being set?
What factors are used to set the HPS? (Pharma company B)
... Price being the only indicator to win the tender and negotiation...
(Pharma company C)

II

III
IV

... Distributors found difficulties in sending products

to buyers. As an example in remote area, a health facility
ordered a total medicines cost of Rp 600.000 (franco districts),
but the transportation costs were more than Rp 600.000.
(DHO Representative)

Distributors are not attracted to serve the purchase order

because the margins given to distributors are not sufficient
to send the products. (Distributors)

Conclusions

Acknowledgments

There have been implementation challenges and

unintended consequences with potential negative impacts.
Continued assessment of the impacts of procurement policies
over time will be necessary.

Distributor

Approved within 7 days

Pharmacy

National
Drug
Planning

Pharmaceutical
industries

Staff of the National Team for the Acceleration of Poverty Reduction (TNP2K)
Collaborators at IMS Health and Harvard Medical School
Australian Government Department of Foreign Affairs (DFAT)

Prince Mahidol Award Conference, Bangkok, Thailand, 26 to 31 January 2016