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Innovation in the Health Sector through Public Procurement and Regulation

  • Published 03/01/2012

 

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DESCRIPTION/BACKGROUND

The Ministers of Industry in the Nordic countries have decided to launch a Nordic program on innovation within public procurement with focus on health care. The program has been developed by a working group consisting of representatives from Ministries, National Innovation Agencies, Nordic Council of Ministers and Nordic Innovation.

 

There are a number of obstacles[1] that cause the level of innovation to be relatively low when it comes to development of welfare and health solutions. There is first of all a lack of knowledge on how to use public procurement as an instrument in the broader framework of public service renewal. In addition, skills and mindset among procurers are fundamental because the mindset of the procurer is much about saving money and securing quality and not so much about looking at the potential for public procurement as a strategic tool to develop or enhance new technology or new solutions. This is natural; when a hospital engages in procurement of innovation, the hospital invests resources and takes a large risk, while society as a whole benefits from the innovation. Few public bodies will engage in procurement of innovation unless given a mission to do so from their owner or utilizing public incentives.

 

Most procurers will focus on short-term savings. Initiating processes that has the potential to reduce costs some years into the future is not always likely to have management or political backing. The way budgets are divided into posts and organizations are divided into departments, procurers are often not able to capture all benefits of a new solution (for example reduced manhours required).

 

Finally; good access to information is a prerequisite for a well-functioning market. The tools applied in innovation friendly procurement are meant to open up the information flow between procurer and suppliers in order to design the tender process in such a way that the procurer receives relevant market information and tenders for the best way to solve the problem at hand. The projects proposed are aimed at improved dissemination of information. The obstacles are generic for public procurement of innovation[2] and are so to speak generic for all the Nordic countries.

 

NORDIC ADDED VALUE

  • Development of the field of public procurement of innovation within the health care sector
  • Development of networks and contribution to dissemination of information, best practice and results
  • Encouragment of health organizations to integrate innovation in their thinking when they procure
  • Contribution to new skills and changed mindset among procures in order to use procurement as a strategic tool for development
  • Encouragment of cross-border cooperation both among health procurers and among suppliers
  • Raise of awareness at management level of the potential in public procurement
  • Creation of market opportunities and development of ideas and companies, with a particular emphasis on SMEs
  • Development/dissemination of tools and methods for procurement of innovation

 

PURPOSE

The purpose of the project is to strengthen the exchange of knowledge, co-creation and cooperation in focused networks for procurers and suppliers in the Nordic region. The objective of the project is twofold:

  • To contribute to the development of public services, with particular emphasis on the health care sector, by encouraging public procurement and innovation  
  • To contribute to the progress of  the Nordic supplier industry through closer contact with public buyers for new innovative, effective and competitive solutions 

NORDIC INNOVATION CONTRIBUTION

Nordic Innovation is the Secretariat for the Program and is responsible for facilitating the progress of the program and will partly fund the activities in the program.

 

PARTICIPANTS

Ministry of Trade and Industry in Norway owns the program and Nordic Innovation is the facilitator and co-ordinator for the program. Project partners are Tekes (Finland), Danish Business Authority (Denmark), Vinnova (Sweden), Innovation Norway (Norway) and Rannis (Iceland).

 

TIMELINE

The program was launched in 2011 and will be finished in 2013.

 

 


[1] Demand, Innovation and Policy: Underpinning Policy trends with Academic Analysis, Abstract Booklet, Manchester, 22nd and 23rd March 2012, Manchester Institute of Innovation and Research, Manchester

[2] Demand Innovation and policy: Underpinning Policy Trends with Academic Analysis, 22nd and 23rd of March 2012

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In October 2010, the Nordic Trade and Industry Ministers agreed on a new industrial and innovation policy cooperation program focusing on green growth. Six lighthouse projects were launched for the period 2011-2013. Nordic Innovation is contributing to the realization of the projects together with the Nordic countries.

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