Novation wants manufacturers to know that it’s taking new – make that “better” -- technology seriously.
     The Irving, TX-based purchasing group has taken a number of steps to make sure that it creates opportunities for manufacturers of new technologies, including posting a “Technology Forum” on its website and appointing a senior director of safety, technology assessment and QA/RA.
     Though she’s proud of Novation’s record in assessing new technologies, Cathy Denning, R.N., M.S.N., the newly appointed senior director, says the program is steadily improving.
     Much of that improvement is based on Novation’s new “operating principles,” formulated in August 2002, in which the GPO pledged to “ensure that member hospitals have timely access to new and innovative technologies.” Among the GPO’s pledges were the following:

• Novation's review of innovative technology will include increased involvement of hospital members and, where appropriate, outside experts.
• Novation will increase communication about innovative technology to all relevant audiences.
• Novation will re-bid product agreements or add vendors to agreements in the event that a new technology enters the market offering incremental patient care or incremental safety benefits, based on review and recommendation by member councils.
• Future contracts for clinical preference products that demonstrate incremental patient care and/or incremental safety benefits will be dual/multi-source awards, subject to member review and approval.

     The operating principles were published in the wake of last spring’s Senate Subcommittee hearings about the group purchasing industry, and a rash of New York Times articles critical of GPOs.
     A registered nurse, Denning began working for Novation three years ago as IV systems product manager. For thirteen years prior to that, she worked in the home infusion and high-tech home care industries, including a program for pediatric ventilator patients. She is an oncology nurse by training.
     In addition to making sure that Novation gives innovative technologies a shot, Denning also is charged with ensuring that Novation considers the safety aspects (to health care workers and patients) of products under consideration, and the quality of those products and the companies who make them.

     Opening up the bid process
     Novation has incorporated language about innovative technology into its standard invitation-to-bid, says Denning. If a manufacturer wants Novation to consider its technology new and innovative, it must submit FDA and patent information. Novation will sign non-disclosure agreements, if the manufacturer wishes.
     “When we receive information about a particular product, we will research the literature and access third-party assessment groups if necessary,” she says. Ultimately, the information will be brought to one of Novation’s approximately 35 member councils and task forces, who decide whether or not the technology is indeed innovative and better than the existing standard, and if so, whether it should be brought on contract. “It could be innovative but not better, and it could be new but not innovative,” she says. “So we have to triage and sort through that.”
     Novation can call upon its member market research department for more information, says Denning. The department surveys the general membership or segments of it to obtain further information about particular products being considered for contract, or about particular features of products.

     Technology Forum on the Web
     Visitors to the Novation website (www.novationco.com) will find a new section called Technology Forum. Open to the public and all suppliers (both off and on contract), the section allows suppliers to publicize their new technologies.
     The Technology Forum links to each supplier’s site, for visitors interested in additional information. An on-line form is provided where the GPO’s members can share their comments on the technology, and/or request that Novation consider bidding or adding the technology to its portfolio of agreements, with a link to the Novation bid calendar. Other featured links include those to the FDA and the Advanced Technology Program of the U.S. Department of Commerce.
     “We believe this will offer us an opportunity to look at companies that may offer technologies we may never have been aware of,” says Denning.

     Education process
     A major part of Novation’s emphasis on innovative technology is education.
     “I educate smaller companies, innovative companies, and others about how to participate in our bidding process and how to work through our technology assessment group,” says Denning. “We’re hopeful that the Technology Forum will provide a consistent avenue for us to obtain information from anybody out there who would like to submit a bid.”
     She also says that Novation is educating third-party technology assessment companies about just what the GPO is looking for. “A lot of these firms look at technology assessment as space planning, cost per procedure, cost/benefit,” she says. “But our needs are a little different than that. Our technology assessment process looks at whether one product offers benefits over another from a patient-care or safety perspective, and whether it’s new, innovative and better than what we’ve had.” Such companies have to be educated as to what Novation is seeking, she adds.

     Boils down to contracts
     Novation is seeking both consistency and flexibility when it comes to innovative technologies, says Denning. “Consistency” in the sense of instituting a standard protocol for assessing all new, innovative technologies, and “flexibility” in the sense of accommodating technologies that emerge to contend with those of existing Novation contract vendors. Hence the GPO’s pledge in its operating principles to re-bid product agreements or add vendors to existing agreements in the event that a new and better technology emerges.
     As part of the bid extension or re-bid process, Novation’s contracting staff routinely checks on the existence of new technologies, and then decides whether an existing agreement should be renewed or re-bid, or if other products need to be added to the existing agreement, says Denning.

     Clinical preference products
     Because innovative technologies tend to be clinician-sensitive, Novation has taken an especially hard look at how it contracts for clinical-preference products. In short, the GPO will strive to sign dual- or multi-source awards for such technologies whenever possible, except where it’s not in the members’ best interest to do so.
     The GPO’s recent contract for needles and syringes demonstrates its new approach.
     While standard needles and syringes may be commodities, safety products remain clinically sensitive, concluded the member council and task force that orchestrated the agreement. For that reason, they gave the contract for standard products to Kendall and BD, but opened up the agreement for safety products to those two suppliers as well as Abbott Labs and Portex Inc.
     In addition, Novation signed a contract in November with St. Jude Medical for its atrial fibrillation suppression technology, a unique offering missing from Novation’s pacemaker vendor contracts. “By identifying what are clinical-preference items at the front end, we are able to provide the evidence necessary for our councils and task forces to think critically down the road,” says Denning.