GOOD MORNING

1
GOOD MORNING

• AAH Hospital Service
• Supplier Symposium 2007
• Supply Chain Partner of Choice

2
Jeff BulmerAAH PharmaceuticalsHospital Service
Director
FS70669
3
Supply Chain Partner of Choice

• A question or statement?
• For whom?

4
Supply Chain Partner of Choice
5
Our Supply Chain Solutions

• Adding value solutions
• Efficiency
• New solutions
• New customers - complex solutions
• Extended services
• Beyond the norm with AAH Hospital Service

6
Efficiency

• Efficiency, with Efficacy and Economy
• Customer demand
• Tax monies
• Improved supply chain
• Reduced costs to AAH and suppliers

7
Our Supply Chain Solutions

• Adding value solutions
• AVS Added Value Services
• New solutions
• Avon Gloucester Wiltshire Out Patients Pilot
• New customers - complex solutions
• Prisons, Birmingham
• Extended services
• eCommerce, Contract Price Visibility
• Beyond the norm with AAH Hospital Service
• Ask the question

8
Added Value Services

• Order Activity
• Identifying the processes involved in pharmacy
  surrounding the procurement and receipting of
  goods and reconciliation of invoices prior to
  payment.
• Inventory Management
• Controlling stock levels to balance the need for
  product availability against the need for
  minimising stock holding and handling costs.
• Internal Supply Chain
• Controlling the movement of stock from pharmacy
  operations to other stock locations within the
  Trust
• Finance
• Finance is an integral part of the order to cash
  cycle. The management of the relationship
  between finance and pharmacy is paramount to
  ensure supply and optimise financial
  opportunities.

9
Added Value Services- taking cost out of the
pharmaceutical supply chain
if you cannot give us more discount how can you
help us save money in pharmacy ? Peter Akid
Chief Executive Gtr. Manchester CPH
10
AVS - Order Activity Product tailing

• Review of products and order activity
• Identify lines that can be
• Sourced from existing suppliers
• Substituted
• Procured via the wholesale channel
• Full transaction analysis for hospital pharmacy
• Supplier, Quantity, Contract
• Reduces activity costs and reduces waste in a
  hospital pharmacy

11
AVS - Order Activity - Product Tailing - Results

• Swindon Hospital - South West
• 40 suppliers identified with 1 product assigned
• 12 could be sourced via AAH
• 15 Other existing supplier could be used
• Benefit to hospital
• Reduction in no of orders raised _at_ 40 per order
• Cost saving on 30 lines
• Carriage costs
• Reduction in stock levels
• Increased discounts on products (AAH)
• Benefit to AAH
• Incremental sales for 12 products
• Increased customer loyalty
• Leverage wholesale over direct.

100k saved per year
12
New Models and Understanding

• Outside of traditional hospital pharmacy
• Avon Gloucester Wiltshire (AGW) hospitals
• Out Patient Dispensing Pilot
• Reducing complexity in home delivery
• Building a generic evolutionary model
• Within existing channels AAH partnership

13
AGW OPD Pilot

• Very simple model
• Reduced pharmacy activity, reduced stock holding
• Clearer visibility for suppliers
• Patient convenience
• (PCT VAT saving)
• Increased admin, is outweighed by benefits

14
Complex Customers

• Northern Ireland
• Scotland NPO
• Collaborative Hubs
• Prisons a parallel model in development
• Prisoner health is PCT responsibility since
  April.
• Prison health budgets held by PCT.
• 3 routes of payment PCT internal shared
  services in Newport, or NHS shared services in
  Wakefield. Long term payment processing at
  National Shared Service Centre
• Phoenix Programme, new ways of working to reduce
  costs.
• A new IT system will be implemented across the
  Prison Service to help achieve this.

15
Complex Customers - Prisons
Newport Internal Shared Service
Xansa NHS Shared Business Services
PCT
16
Complex Solutions - Birmingham

• 560 million
• 1200 Beds
• (100 critical care)
• 30 Theatres
• 137,000 sq.metres

17
Complex Solutions - Birmingham

• New Hospital to be completed by 201020112012.
• 10 year contract under tender
• Lot 1 Drug Sourcing and Delivery
• Total pharmaceuticals contract value 28m
• Lot 2 Automated Dispensing Technology (ADT)
  supply
• Cardinals, McKesson, ARX, Mach 4
• Intention is to utilise automation for all or
  most storage and dispensing activity.
• Central 2x ADT
• Floor Level 5x ADT
• Ward Level 24x ADT

18
AAH Hospital Services Extended Services

• E Commerce beyond ordering and invoicing
• Management Information for transparency and
  efficiency
• AAH leading supplier in Hospitals, and also in
  transaction handling
• Note EDI may not be available to some hospitals
  as GHX switches access off (PMS, XML and e-mail
  preferred)

19
Extended Services - eCommerce

• Customer Contract Price Visibility
• Now available to the 4 national central
  contracting bodies
• PMS
• 100 eCommerce in NHS
• 4 Nationals, AAH, GHX, suppliers and wholesalers
• With GS-1 - Coding for Success
• No longer aspirational its an expectation
• Automation

20
Extended Services - eCommerce

• Supplier Contract Price Visibility

21
Extended Services Contract Management

• A core service, being pushed
• CPV visibility
• With greater transparency, greater interaction
• New Awards, end of contracts
• New products and line extensions
• Demand management
• Tracy McGillion, Contracts Manager

22
Beyond the norm with AAH Hospital Service

• Ask the question!
• Multiple existing models
• Flexibility
• Changing Distribution Models

23
Thank You
FS70669