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edited by AIFA’s Office of Osmed and HTA

Glossary


PROCUREMENT METHODS
The following procurement methods are being used in actual practice: Open tender An open tender is a formal procedure whereby quotations are invited from a potential manufacturer or supplier. Restricted tender A restricted tender, open only to prequalified suppliers, seems to work best in small countries. Although initial evaluation of suppliers is time consuming, when a core of prequalified suppliers has already been established, the recurring work for the procurement agency and the overall workload is significantly lower than that in an open tender. Product quality may be more easily assured through a restricted tender. Competitive negotiations Competitive negotiations means approaching a few selected companies and requesting price quotations. Usually, this method results in higher prices. Direct procurement This is the simplest but perhaps the most expensive procurement method of all as it involves direct purchase from a single supplier either at quoted prices or negotiated prices. This method is well suited for emergency situations, but is not the preferred choice for routine orders. [Source: WHO. Practical Guidelines on Pharmaceutical Procurement for Countries with Small Procurement Agencies]
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