Prospects for development of group purchasing organizations (GPOs) in China within the context of national centralized drug procurement

Abstract

Healthcare group purchasing organizations (GPOs) are considered to play an integral role in the healthcare supply chain by keeping prices low and helping all members of the healthcare system achieve their objectives. China has been exploring GPOs in the field of drug procurement since 2015, and there are currently three GPO models in Shanghai, Shenzhen, and Guangzhou. Although the three models operate differently and they have each been examined, they have all achieved certain results and demonstrated the ability to control drug expenditures. In 2018, the National Healthcare Security Administration implemented a national centralized drug procurement policy, also known as the 4 + 7 procurement policy ("4+7 Policy"). This policy context has also led to changes in the strategy for development of GPOs in China. GPOs need to explore strategies that do not overlap with the scope of 4 + 7 procurement, and they need to develop dynamic and personalized procurement plans that are more in line with first-line clinical practices to have a synergistic effect in combination with the "4+7 Policy." In the future, GPOs will grow rapidly in China. The number of GPOs need to be increased to prevent monopolies, and GPOs need to expand their diversified value-added services to perform more tasks in terms of supply chain management and data analysis.

Keywords: China; centralized drug purchasing; group purchasing organizations (GPOs).