Contracts with Suppliers

Maintaining security of supply also requires the National Blood Authority (NBA) to manage contracts with suppliers of blood and blood products. Contracts are developed in accordance with the Commonwealth Procurement Rules, and managed in accordance with best practice guidance for contract management, including the guideline from the Australian National Audit Office on Developing and Managing Contracts.

The NBA currently manages 15 blood and blood product supply contracts and arrangements.

The contracts managed by the NBA include:

  • Fresh Blood Product Procurement - Australia's fresh blood component requirements through the Deed of Agreement with the Australian Red Cross Society.
  • Plasma and Recombinant Product Procurement - Australia's plasma product and recombinant product requirements through:
  • the National Fractionation Agreement for Australia (NaFAA) and contracts for the provision of imported immunoglobulin (Ig), imported recombinant factors VIIa, VIII, IX, and XIII, and other imported plasma and recombinant products
  • Red Cell Diagnostic Products Procurement - Australia’s requirements for red cell diagnostic products.

Health provider verification of supplier performance

Since 2003 the NBA has undertaken periodic sample-based Goods Ordering and Receipt Verification (GORV) audits of the suppliers under national contracts administered by the agency. The audits are fundamental to the NBA’s national contract management role, and provide verification of supplier invoicing.

During the GORV audit at the end of each quarter, the NBA asks relevant health providers to confirm orders and receipt of product from the health providers’ administrative records.

It is important to emphasise that this process is not an audit of health providers but focuses only on supplier performance against national contract requirements.

Detailed information is available for download:

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Procurement Process

The NBA has developed a robust approach to tendering and contracting for blood products, reflecting both the policy objectives of governments under the National Blood Agreement, and the policies and requirements of the Australian Government procurement framework.

How these objectives are achieved depends on the product and the supply arrangements in question. The NBA relies on regulation by the Therapeutic Goods Administration to address the major policy aim of safety. The policy aim of affordability is addressed through various procurement mechanisms such as competitive tendering, price benchmarking and other specific negotiation approaches. The policy aims of adequacy and security of supply are addressed through a range of measures such as primary and contingency supply arrangements, inventory and inventory reserve requirements, and an integrated regime of supply and contract risk protections.

The NBA undertakes extensive preparations for tender processes. Within the year before releasing tenders this process will generally include:

  • gathering information on the global market
  • obtaining information and customer feedback from suppliers and stakeholders on important issues such as:
    • the level of satisfaction with the current supply arrangements
    • the products needed and the availability of product choice
    • the tender period preferred by suppliers and the potential for product enhancements during that time
    • the extent of competition for supply of specific products
    • price considerations
  • reviewing the current arrangements to identify where improvements might be gained (e.g. security of supply, safety and value for money)
  • using our knowledge of normal supply chain and commercial arrangements of suppliers to design arrangements that suppliers can achieve and sustain.

Customer Feedback on Commercial Supply Contracts

Feedback on supply arrangements managed by the NBA should be directed firstly to the relevant supplier.  Visit Customer Feedback on Commercial Supply Contracts for more information on the NBA established customer feedback mechanisms for commercial supply contracts.