The bundling of requirements for the strategic sourcing of active substances for the production of pharmaceuticals progressed successfully in 2007, resulting in a cost reduction in 2008.
The prices of energy, oil-based products, and all products based on energy-intensive production processes increased again in 2008. These include plastic granulate and foil used in the production of primary packaging for infusion solutions and other pharmaceutical products, glass for containers, and aluminum for fastenings. A supply agreement for aluminum fastenings was concluded in 2007 at slightly increased prices, but these were still below the level of market prices in 2008. There were further increases in the prices of cardboard boxes. Thanks to an agreement concluded in 2005, the price of electricity was held stable at the locations in Germany in 2008. Moreover, Fresenius Kabi had already examined the potential for cutting gas and electricity costs in a number of regional synergy projects in 2007. This will be continued and extended over the long term.
The “Fresenius Pool IT” sourcing project was also completed in 2008 with very good negotiating results. This led to the conclusion of new contracts for IT hardware for all Fresenius companies.
For the production of IV drugs in the United States, we require raw and other materials conforming to U.S. Food and Drugs Administration regulations. Some materials are only available from a limited number of suppliers, meaning that higher stocks of these materials may need to be maintained at times. Quality management and procurement management are therefore closely coordinated to assure stability of supply and the consistently high quality of the production materials together with optimum storage.
Fresenius Helios
At HELIOS, high medical standards go hand in hand with an efficient, economically sound management of available resources. Its procurement management system combines the expertise of its doctors and nurses with the commercial competence gained in other areas from the various clinics and disciplines. This capability and our standards of medical quality are channeled into all procurement decisions for the benefit of the patient.
Today, more than 85% of our medical supplies are standardized. A system of 280 product groups promotes transparency, planning efficiency, and competition. The electronic configuration of all purchasing processes (e-procurement) – from ordering to billing – results in even greater efficiency and transparency. The process of consolidation among firms in the healthcare market can lead to temporary supply bottlenecks. Procurement management at HELIOS is successfully forestalling this by standardizing the drugs and medical devices used at its clinics.
In 2008, the HELIOS Drug List was introduced, with 45 supply contracts covering 90 % of our clinics’ drug requirements. About 10% of the product portfolio used at the clinics was standardized. For the first time, 170 generic active agents, representing an annual procurement volume of over € 4 million, were negotiated on a coordinated basis. The goal was to standardize the drugs used at the HELIOS clinics and agree with suppliers a minimum three-year period of stability for this broad range of products. This cut costs by over € 400,000 in 2008.
HELIOS actively involves suppliers in the procurement management evaluation process. This is done once a year and reviews the business relationship between HELIOS and its suppliers from the viewpoint of both partners. The resulting ratings and feedback are used to optimize business relations. A total of 59 suppliers took part in HELIOS’ third partner rating process at the end of 2008.
