UNDP Sustainable Health Procurement Policy & PracticeDr. Rosemary Kumwenda HIV, Health and Development, Regional Team Leader Eastern Europe and Central Asia (EECA)rosemary.kumwenda@undp.org

HCWH Workshop, March 27, 2017, Seattle, US

UNDP RBEC HIV, Health and

Development team

Consistent with the 2030 Agenda for Sustainable Development, UNDP’s HIV and health focus areas: Focusing on the linkages between health and environment

Addressing the social, economic and environmental determinants (SEEDS) of health and health equity

Strengthening national responses to ensure a multi-sectoral response to non-communicable diseases (NCDs)

Strengthening HIV responses with a strong focus on key populations at higher risk of HIV

2012 – Establishment of the United Nations Task

Team on Sustainable Procurement in the

Health Sector (SPHS)

SPHS Task Team is, through a transparent and inclusive engagement process,

leveraging its normative and market power, lowering the environmental impact of its

procurement, with a final aim of improving human health and well-being.

Market leverage of the SPHS Task Team

Key pillars of our work

Linking our work to the Sustainable

Development Goals and Key Focus Areas

The United Nations Task Team on Sustainable Procurement in the

Health Sector (SPHS)

Procurement as

leverage.

UNDP Policies and Strategies

Introducing Sustainable Procurement

Practices in the Global Health Sector:

Green Procurement Index Health

THE GREEN PROCUREMENT INDEX HEALTH ROADMAP

PHASE 1 Develop GPIH green procurement criteria/ Collect suppliers’ data /

Develop supplier engagement strategy/ Communicate

PHASE 2 Finalize and launch

GPIH criteria 2.0 and the Guidance Note

PHASE 3 Launch Beta-

version GPIH and improve/scale

Scoping

Desk Research & Interviews

Clarify Vision / Goals/Milestones

Project Set-up/ Plan/ Budget

Resource Mobilization $$

$

FOCU

S

IIII II

PHASE 0 (2014)Roadmap

development and funding

UN Expert

X: CO2 Y: ResourcesZ: Toxicity

Supplier Environment

al Profile

Supplier

Product data

UN Procurement

data

Communication

Start Working Group B(Data Collection, Processing, Publication and Implementation)

Start Working Group A(Development of GPIH Green Procurement Criteria)

Set-up Advisory Boards

I

I*Operate Supplier Engagement Forum

Develop Supplier Engagement Strategy

Develop GPIH Green Procurement Criteria 1.0*

Organize UN Procurement Workshop and develop GPIH Green Procurement Criteria 1.1

Revise GPIH Green Procurement Criteria 1.1 (Crowdsourcing)

Finalize and Launch GPIH Green Procurement Criteria 2.0II

Use GPIH Green Procurement Criteria 2.0 (Basis for Beta-version GPIH). Improve and Scale Continuously

Publish GPIH on a Regular Basis for Each UN-Agency (Aim: Transparent Development of the GPIH and Individual Underlying Green Procurement Criteria)

IIIDevelop a Guidance Note on the GPIH Green Procurement Criteria 2.0

$$$ Analysis of Financial Implications

Legal and Regulatory Reviews

Introducing Sustainable Procurement Practices

in the Global Health Sector with HCWH

Introducing Sustainable Procurement Practices

in the Global Health Sector with HCWH

List and products identification and development

Low carbon & resource depletion1

2

3Green health procurement criteriaGuide for procurement practitioners

Substitution list of toxic chemicals197 shortlisted from global conventions and authoritative lists

Three Main Procurement StagesUnited Nations

Procurement Process

Procurement processPre-purchasing

PurchasingPost-purchasing

Sourcing

Evaluation

Logistics

Contract Management

Planning

Requirements definition

Bid receipt and opening

Contract finalization and issuance

Solicitation

Review and award

Goal of the procurement stage:

Introduce sustainability from the start when the health commodity or service requirements are being definedUnited Nations

Procurement Planning

Sourcing

Evaluation

Logistics

Contract Management

Planning

Requirements definition

Bid receipt and opening

Contract finalization and issuance

Procurement process

Solicitation

Review and award

Pre-purchasingPurchasing

Post-purchasing

1

What is the procurement aiming to achieve? Can alternative goods or services be used to meet the identified

need? What performances are required? Do we need it to meet certain

specifications? Can we hire functions rather than products (aka “servicing”)? How long is the need going to last? What happens to the product at end-of-life? How does this procurement impact upon our (environmental/

social) objectives and policies?Defining the need:

Ask challenging questions

Who might be involved in identifying

needs?

Knowledge of the market/Knowledge of potential environmental/social impacts and relevant regulations and legislation

• Procurement managers• Procurement officers

• First- and second-tier suppliers

• End users/requisitioners• Environmental/Supply Chain/

HR managers

Knowledge of products/services; influence on the development of new products/markets

Information on alternative products/services, alternative means of delivering functionality

KEY ROLE

1

Sourcing

Evaluation

Logistics

Contract Management

Planning

Requirements definition

Bid receipt and opening

Contract finalization and issuance

Procurement process

Solicitation

Review and award

Pre-purchasingPurchasing

Post-purchasing

2

3

4

5

Some examples of SPP integration:1) Planning

• Assess sustainability impacts of the procurement

• Consider using a “sustainable title” for the process

2) Requirements definition• Use relevant technical standards and

environmental labels• Use performance and functional

specifications

3) Sourcing• Research the market for sustainable health

products/services• Pre-qualify suppliers that minimize

sustainability risks

4) Solicitation• Include pre-determined sustainability evaluation

criteria • Include Life-cycle-costs considerations

5) Contract management• Work with suppliers to improve sustainability

performance

Structured Approach to Sustainable Health

Procurement:

Integration of Sustainability

Considerations Throughout the

Procurement ProcessSpecial attention: when integrating technical SPP requirements in health sector, you need to ensure that they will comply with the World Health Organization Pre-Qualification Scheme of Medicines Programme (PQP) and national regulations

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Sustainability impacts over the life of a productMapping

Sustainability RisksExample: Carbon emissions of a UNDP Global Fund health initiative – HIV/AID grant R8P2 in TajikistaniSource: UNDP (2013) Carbon footprint of UNDP Global Fund health initiatives in Montenegro and Tajikistan

Case Study:

CO2 Emissions Reporting for Logistics

In partnership with Kuehne + Nagel A/S, data and analytics for CO2 emissions were collected on a quarterly basis. The CO2 emissions below are from the TLE/ARVs LTA framework in 2015.

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CO2 Emissions Reporting for Logistics

Air16%

Sea84%

Total CO2 Emission (kg) for 2015445,698.62 CO2/kg

2015 CO2 Report TLE-ARV

Air Sea0

0.5

1

1.5

2

2.5

3

3.5

2.89

0.33

Average CO2 Emission per kg for 2015

CO

2 E

mis

sion

per

kg

A reduction in 0.21 Kg of CO2 per TLE pack and US$0.26 per TLE pack is acquired by switching from air to sea freight for the specified trade lane.

Decrease in CO2 81%

Cost Savings49%

Case Study:

Re-thinking Procurement of Anti-retroviral (ARV) Medicines - Packaging

Optimization and Innovation

Package Reduction Pilot for South Sudan / Zimbabwe 2016

Problem• A considerably high amount of unnecessary

product packaging and its leaflets

Solution• Eliminate individual outer bottle package• Eliminate individual leaflets glued to bottles• Shrink bottles wrapped and packed in carton

boxes / shippers • Reduce leaflet amount of 5-10% for bottles

shipped in the carton boxes

Sustainability• Reduction of product waste (12% waste

reduction)• Cost effectiveness (15% cost savings)• Carbon footprint reduction (13% kg of CO2 per

unit)

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Source: UNDP (2016). New packaging examples provided by one of the UNDP TLE/ARV suppliers

Waste reduction

12%

Cost Savings15%

Case Study:

Solar Panels Improve Healthcare in Rural Zambia

Rethinking needs• From diesel generators (high fuel costs

and unreliable fuel delivery) to solar panels (reliable and affordable energy supply)

Challenges• Health facilities were isolated for six

months of the year during the rainy season - roads become inaccessible

• Urgent health care services impossible in the absence of electrical power

Sustainability• Environmentally friendly power sources to

maintain the quality of medicines and laboratory reagents

• Facilitation of water purification and wider range of diagnostic equipment

• Expected cost recovery around 15 years

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Source: UNDP (2016) Solar Panels Improve Healthcare in Rural Zambia

Solar For HealthInitiative

Procurer‘s Dilemma:

Does Final Price of the Health Commodity or Service Rise with the

Introduction of Sustainability Criteria?

The price on its own does not allow us to achieve a sustainable purchase or contract

The price on its own, without considering other costs and if no sustainability criteria have been included elsewhere (selection, obligatory specifications, contract performance clauses), does not allow us to achieve a sustainable purchase or contract. Nor does it allow us to get the most efficient purchase from the point of view of resource use.

The most advantageous bid allows the use of sustainability criteria and actually make a purchase that uses the administration's economic resources efficiently.

Efficiency in the use of economic

resources

Lowest Priced Bid

• Quality• Social and

Environmental criteria• Life Cycle Costs…

Responses to identified

sustainability risks and objectives can be incorporated in one or more of the different

stages of the procurement process

Sourcing

Evaluation

Logistics

Contract Management

Planning

Requirements definition

Bid receipt and opening

Contract finalization and issuance

Procurement process

Solicitation

Review and award

Set mandatory requirement(s)/technical specifications in the Invitation to Tender

Invite only those suppliers who meet specific sustainability requirement(s)

Develop desirable sustainability requirements and set-aside sustainability points that will be assigned to

bidders offering more sustainable solutions as part of the evaluation process

Incorporate sustainability performance contract clauses to be monitored during contract management or work with suppliers during contract administration

for enhancing sustainability performance of the product/service offered or their corporate performance

Example:

Possible options to manage the

sustainability of tuberculosis (TB)

medicines

When• Supplier

selection

HowOnly allow suppliers to bid who have Environmental Management System ISO 140001 or equivalent certified

• Specification Specify that you will only buy TB medicines from suppliers and manufacturers that have been ISO 140001 or equivalent certified

• Bid evaluation Assign evaluation points to reward bids with sustainability features

• Contract Management

Ask the supplier to provide TB medicines, then work with them during the contract to improve sustainability

UNDP Environmental Assessments of Suppliers and

Manufacturers of Health Commodities

and Services:

Questionnaire and Online Environmental Assessment Tool (OET)

A user-friendly and dynamic tool which provides comprehensive overview of the environmental performance of suppliers and manufacturers of health commodities and services

Interested in testing this tool, which was developed in consultation with leading technical experts? Please contact us at info@savinglivesustainably.org

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Questionnaire and OET

Sustainable Procurement GuidelinesWill provide comprehensive information on sustainable procurement recommendations in the health sector

UNEP, Sustainable UN, UNDP Sustainable

Procurement Guidelines – Health

Sector:

Background ReportThis guideline will be part of a series: Additional guides available at www.greeningtheblue.org & www.ungm.org

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Healthcare Procurement and the

Compliance with International

Environmental Conventions on

Chemicals:

A UNDP Guide For Procurement Practitioners

Healthcare Waste Management

UNDP is currently active to develop a practical toolkit for healthcare waste management.To assess the possible environmental impact of GF grants, rapid assessments on healthcare waste were carried out

http://www.eurasia.undp.org/content/rbec/en/home/library/hiv_aids/rapid-assessment-healthcare-waste-global-fund.html

Engagement with the key stakeholders from

the health sector:

Focus on Procurement Practitioners

Sustainable Public Health Procurement TrainingsUNDP-UNEP-HCWH support government officials to design and implement sustainable public health procurement policies that equally factor in the social, economic and environmental impact of their operations.

Next training in New Delhi, India, 10-11 April, 2017 Interested to host a training in your organization? Please contact us at info@savinglivesustainably.org

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Engagement with the key stakeholders from

the health sector:

Focus on Suppliers and Manufacturers of Health

Commodities

The supply chain is the new frontier for sustainable business Once your processes are in

place, the next major source of sustainability risk and opportunity is your supply chain.

You need to know where your products and services are coming from, and you need to be confident that the third parties involved in this sourcing understand and adhere to your principles.

Continuous improvements through linking supplier engagement to contract KPIs:

Development meaningful relationships with suppliers

Gain the assurance you need for proper risk management

Drive more sustainable business practices within your supply chain operations

Engagement with the key stakeholders from

the health sector:

Focus on Suppliers and Manufacturers of Health

Commodities

Engaging with suppliers and manufacturers

Allocating due time to

respond to EOIs and

RFIs

Contactin

g previou

s

shor

tlisted

supp

liers

Information in journals,

radio stations, internet, etc.

Pre-bid w

orkshops

and

seminars

Targeted Communication and Ensured Fair-Play

E.g. SMEs, disadvantaged and vulnerable groups

Engagement with the key stakeholders from

the health sector:

Focus on Suppliers and Manufacturers of Health

Commodities

Interagency Statement on Engaging with Suppliers and Manufacturers on Sustainable Health Procurement

Engagement with the key stakeholders from

the health sector:

Focus on Suppliers and Manufacturers of Health

Commodities

Engagement Strategy on Engaging with Suppliers and Manufacturers on Green Health Procurement

Engagement Statistics:

Jan - Dec 2016

Engagement with the key stakeholders from

the health sector:

Focus on Suppliers and Manufacturers of Health

Commodities

Asia Forum 2017Manila, PhilippinesNovember 2017Sustainable Manufacturing in the Health Sector: Fostering Social, Economic and Environmental Benefits

Online Knowledge-Hub on Good Practices in

Sustainable Health Procurement and Manufacturing:

www.savinglivesustainably.org

Our Network Outreach:

Jan - Dec 2016

Looking Forward – 2017 onwards:

More Sustainable Health Policies, Strategies and

Practices

The future starts today.GET IN TOUCH @ www.savinglivesustainably.org

We look forward to working with you on a more sustainable global health sector.