Blood Collection System Asia Sourcing Case Study

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Blood Collection System

Asia Sourcing Case Study

September 2015

1. Introduction & Project Objectives

2. Approach & Schedule

3. Demand Analysis

4. Supply Markey Survey

5. Price analysis

6. Supplier Assessment

7. Supplier Profile Example

2© 2015 Dragon Sourcing. All rights reserved.

Agenda

Project Objectives

© 2015 Dragon Sourcing. All rights reserved.

Introduction:

• Client is a Special Health Authority in Europe

• Has an ongoing requirement for “Blood Collection Systems” with a value of approximate

€ 29 Million/annum

3

Objectives:

• To identify who capable Blood Bag System suppliers in Asia, prior to the tender publication.

• To create awareness with the Asian suppliers for the upcoming Official Journal of the European

Union (OJEU) tender and its requirements

• The key MUST criteria:

1. CE marked as Class IIb medical devices against EU Directive 93/42/EEC.

2. EN/ISO 3826- Part 1, 2 & 3

3. Principles of EU Good Manufacturing Practice: EN ISO 13485

Final deliverables:

• RFI/RFQ analysis report with list of recommended suppliers

• Supplier profiles

Supplier identification process was initiated within the Asian Countries to build long list

of suppliers.

© 2015 Dragon Sourcing. All rights reserved. 4

India

China

Thailand

Vietnam

Pakistan

Malaysia

Indonesia

Singapore

Philippines

South

KoreaJapan

Taiwan



3. Demand Analysis


5. Price analysis




Agenda

© 2015 Dragon Sourcing. All rights reserved.. 6

Approach & Schedule,

No. Step Deliverables

1.

Demand Analysis

Work with client to define and understand the products and requirements (specs, volumes, materials,

production technology requirements, Quality tests, Standards, etc.)

Project Requirement

Questionnaire

Kick-Off Report

2.

Supply Market Analysis

Identify long list of potential suppliers in the selected markets by leveraging B2B Websites, DS

Database, Fair catalogues, Chamber of Commerce, Magazines, Network, References.

Supplier Long List

3.

Telephone Pre-screening

Selection of suppliers to be included in the RFI/RFP process by telephone pre-screening based on

agreed simple criteria (e.g. capability to make the product, minimum company size, interest in

participating)

Shortlist for RFI/RFQ

4.

Develop RFI/RFQ

Prepare an RFI/RFQ document, with an aligned Balanced Scorecard that has the objective to pre-

qualify the competitiveness and capabilities of the suppliers, including: Background, financial, Client

and product experience, Quality certification & processes, Social Responsibility,

Manufacturing/technology capability)

RFI/RFQ Template

Balanced Scorecard

Introduction Letter

Milestone 1: RFI/RFQ & Scorecard Approved

5.

Conduct RFI/RFQ Administration

The RFI/RFQ is translated to the local languages as relevant, and distributed to the relevant suppliers,

with telephone follow-up to push for maximum participation.

• Completed RFI/RFQs

6.

Analyze RFI/RFQ Responses

Analysis of RFI/RFQ responses, estimation of logistics costs, and preparation of a report which profiles

& objectively ranks the suppliers by capability and competitiveness, including a recommendation for

those to be audited/Sampled.

RFI/RFQ Report

Supplier Profiles

Proposed Shortlist for

Audit/Samples.

Milestone 2: Shortlist for Auditing/Sampling Agreed

Stage 1: Supplier Pre-Qualification

StepsDuration/week

commencing

Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8 Week 9

07-13/

07-17

07-20/

07-24

07-27/

07-31

08-03/

08-07

08-10/

08-14

08-17/

08-21

08-24/

08-28

08-31/

09-04

09-07/

09-11

1. Demand Analysis 1

2. Supply Market Analysis 2

3. Telephone pre-screening 1

4. Develop RFI/RFQ 1

5. Administer RFI/RFQ process 5

6. Analyze RFI/RFQ Responses &

submit RFQ report.1


1

2

7

Not started Done

In process Delay

The sourcing process was completed in 9 weeks.

Supplier

recommendations for

auditing/sampling.



3. Demand Analysis


5. Price analysis




Agenda


Whole Blood Collection Systems including Leucodepletion Filter (nearly € 27 Million in

spend).

System

Whole Blood Collection

Systems including

Leucodepletion Filters

Image RemarkForecasted Qty

Y3 (Systems)*

1

Top and Top (TAT) Blood

collection system for whole blood

filtration

Nil 1.7 M

2

Bottom and Top (BAT) Blood

collection system for red cell

concentrates (RCC) filtration

Nil XXX

3

Bottom and Top (BAT) Blood

collection system for RCC

filtration with integral plasma filter

(IPF)

Note: This Blood collection system is similar to

System 2 with the exception of having a plasma filter

and an additional (empty) pack to receive plasma

prior to filtration.XXX

4Whole blood collection system

without anticoagulantNote: This Blood collection system is a dry system

which contains no anticoagulant.XXX

XXX

XX

A

B C

D EF

GH

A

B

C

D

E

F G

H

A

B

C

F

GH

D E

I

J

* Y3 is forecasted for use from 01/05/2015 – 30/04/2016


Ancillary Blood Processing Systems (Primary Components, nearly € 1.8 Million in

spend).

No. Ancillary Blood Processing Systems (Primary Components) Forecasted Qty (Sets) Y3

1 Figure 1 - Quadruple transfer system for the storage of platelets for neonatal use. 6,000

2 Figure 2 - Quadruple transfer system for the storage of frozen plasma for neonatal use. XXX

3 Figure 3 - Quadruple transfer system for the storage of red cells for neonatal use. XXX

4 Figure 4 - Sextuplet transfer system for the storage of red cells for neonatal use. XXX

5 Figure 5 - Single transfer pack for the handling of waste material or storage of plasma components. XXX

6 Figure 6 - Cryoprecipitate pooling system. XXX

7 Figure 7 - Single plasma filter system. XXX

8 Figure 8 - Double plasma filter system. XXX

9 Figure 11 - Platelet storage system. XXX

10 Figure 13 - Platelet pooling filter system. XXX

11 Figure 14 - Platelet pooling filter system with integral sampling device. XXX

* Y3 is forecasted for use from 01/05/2015 – 30/04/2016



3. Demand Analysis


5. Price analysis




Agenda

5547

8

47

33

14

6

5

Japan 1

5

5

5

5

5

4

Pakistan 1

5

4

South Korea 1

4

3

Singapore 1

3

3

3

3

3

3

1

1

Suppliers identified Failed phone screening Passed phone screening

Indonesia

Thailand

Vietnam

Philippines

Singapore

South Korea

Pakistan

Malaysia

Taiwan

Japan

China

India

116

DS identified 142 suppliers in 12 Asian Countries,


26

142

116 suppliers failed phone screening process


29

52

3

2

7

9

68

Traders/importer only, not a manufacturer

Manufacturing secondary components only, Unable to supply complete blood bagsystem.

Manufacturing (products) do not comply with ISO 3826 part 1, 2 & 3

Products not comply with CE marked as per medical devices directive

Only subsidiary or factory, Requested to contact parent Company or Parentcompany, requested to contact subsidiary special for blood bag.

Contact details not valid/not responding

Suppliers already in contact directly with the client

Stopped making blood bags and/or Company shutdown

ISO 9001

ISO 14001

ISO13485

CE marked as Class IIb medical devices against EU Directive 93/42/EEC.

EN/ISO 3826- Part 1: Plastic collapsible containers for human blood and blood

components

EN/ISO 3826- Part 2: – Graphic symbols for use on labels and instruction leaflets

EN/ISO 3826- Part 3: – Blood bag systems with integrated features.

Principles of EU Good Manufacturing Practice: EN ISO 13485 (Medical devices-

Quality management systems)

FDA Approved

Manufacturing QMS

What international/domestic product

certification do you have?

Do you have below certificates ?

Do you currently manufacture, or do you have experience of

manufacturing blood packs?

If yes, What type of blood bags do you manufacture?

Can you provide high quality transparent medical grade PVC film?

Whole Blood

collection

Transfusion

system

Disposable blood

Bags, Tubes &

Ports

Optimal additive

solutions

Needles

manufacturing

Sample site

coupler, Filters. Base Label

Does your company do all production steps in house? If no, please

elaborate.

Type of machinery,

• Fully Automatic

• Semi-Automatic

• Others

Your outsourcing partner (material sub-contractor) comply to EN/ISO

3826- Part 1, 2 & 3?

Your outsourcing partner comply to CE marked as Class IIb medical

devices against EU Directive 93/42/EEC?

Can your company design according to client's requirement?

Yes/No Quantity

Assembly lines (semi-automated)

labelling equipment

Assembly lines (typically automated)

Please list production equipment you will use (others, please specify)

Accurate solutions filling equipment,

validated sterilization plant (typically steam

autoclaves),

ProducerEquipment or Production line

Do you offer following manufacturing process?

Please provide answer with,

• Yes

• No

RFI/RFQ - Contact info

Confidential

DS Contact Person Mr Pankaj Tuteja

Email [email protected]

Tel number +91- 22- 26365009

Mobile + 91- 9867602535

Company Name

Address

Town

Province

Company Website

Contact Person

Title

Email

Tel

Fax

Mobile phone

Detailed specifications are showed in Annex 1 and Annex 2

4. Quality Management: Information requested about Certification, Quality control etc..

5. Factory Pictures: Please provide recent pictures of your factory.

6. RFQ: Request for quotation.

This RFI/RFQ contains a total of 9 worksheets detailed below:

0. Introduction & Instructions: presentation of the objectives and timetable of the

1. Contact Information: General and contact information about your company.

2. Company Profile: Key business and financial information.

3. Production: Manufacturing capability, Production capacity, etc.

COMPANY INFORMATION

CONTACT PERSON INFORMATION

Dragon Sourcing


An RFI/RFP process was administered to filter out most capable suppliers,

Quality Management

Contact detail

information

Production

information

14

4

10

4

8

2

6

2

1

1

1

1

1

1

1

1

1

RFI-RFQ sent Intend To Respond Don’t Intend to respond

Only RFI Received RFI-RFQ received

Singapore

South Korea

Pakistan

Japan

India

China


26

7

19

7 suppliers responded to the RFI-RFQ

6

South Korean supplier submitted only the Company profile (RFI) & will

submit RFQ during the OJEU tender process as they need contact the their

outsourcing US partner for providing Leucodepletion filter

1

Identify Suppliers Pre-screen suppliers Administer RFI/RFQAnalyse RFI/RFQ

received

Xinjiang

Gansu

Jiangxi

Tianjin

Jiangsu

Guangxi

Hunan

Hubei

Qinghai

Ningxia

Shaanxi

Anhui

Fujian

Inner Mongolia

Shanxi

Xizang

Sichuan

Yunan

Guizhou

Henan

Jilin

Liaoning

Guangdong

Gansu

Shanghai

Hong Kong

Taiwan

Heilongjiang

Sichuan


Zhejiang

Shandong

Hebei

# Supplier name City Province Website

1 XXX XXX Sichuan XXX

2 XXX XXX Shandong XXX

3 XXX XXX Guangdong XXX

4 XXX XXX Jiangsu XXX

Beijing

Location of the suppliers responded to the RFI-RFQ



3. Demand Analysis


5. Price analysis




Agenda


- Logistics Process: DDP Price Calculation

- From FOB China & India to DDP Europe destination.

EXW

Price

Loading on container on manufacturing site

Container transportation to China sea port “Shanghai” & Indian sea port “Nhava Sheva”.

Export documents expenses, transportation & other taxes

Handling & loading of the container on the vessel

Loading cost on truck

Haulage cost to final destination

Fuel taxes

Import duty

XXX port handling cost & terminal charges

Clearance Charges Port Security, etc.

Port Infrastructure fees

Sea freight from China & India FOB port to XXX in Europe.

Additional fees (BAF & CAF)

Insurance cost based on the CFR value.

DDP

Price

FOB

Price

Delivered price until client warehouseChinese & Indian suppliers quotation

Country Supplier Product #

Supplier DDP

Price

(Euro/System)

Supplier Annual

spend

Supplier Annual

saving (+/-)

Client Current

DDP

(Euro/system)

Client annual

volumes

Client annual

spend

Based on 20

FCL'Euro (Millions) Euro (Millions) 20' Systems (units) Euro

China

# DSCN/BB24

Total annual

saving € 6.06 M

Figure 1 € 2.60 1.7 M

Figure 2 € 3.02 xxx



China

# DSCN/BB30

Total annual

saving € 3.91 M

Figure 1 € 2.03 1.7 M




China

# DSCN/BB28

Total annual

saving € 0.24 M

Figure 1 € -1.77 1.7 M

Figure 2 € -1.49 xxx

Figure 3 0.04 xxx

Figure 4 0.20 xxx

China

# DSCN/BB27

Total annual

saving € 0.18 M

Figure 1 € -4.90 1.7 M



India # DSIN/BB31 Figure 1 € -16.33 1.7 M

India

# DSIN/BB26

Total annual

saving € 0.19 M





Supplier with highest annual saving was about € 6 million

Highest Annual Saving

C

O

N

F

I

D

E

N

T

I

A

L

C

O

N

F

I

D

E

N

T

I

A

L

C

O

N

F

I

D

E

N

T

I

A

L

C

O

N

F

I

D

E

N

T

I

A

L

Country Supplier Product #

Supplier DDP Price

(Euro/System)

Supplier Annual

spend

Supplier Annual

saving

Client Current DDP

(Euro/system)

Client annual

volumes

Client annual

spend

20' Euro Euro 20' Systems (units) Euro

China

# DSCN/BB24

Total annual

saving € 0.63 M

Figure 1 € 21,795 6,000

Figure 2 € 15,621 xxx








Figure 13 € 238,528 xxx


China

# DSCN/BB30

Total annual

saving € 0.36 M

Figure 1 € 20,960 6,000





China

# DSCN/BB28

Total annual

saving € 1.30 M

Figure 1 € 30,534 6,000









Figure 13 € 462,338 xxx


India

# DSIN/BB31

Total annual

saving € 0.024 M

Figure 1 € 8,145 6,000

Figure 2 € (4,455) xxx

Figure 3 € (4,455) xxx

Figure 4 € (32,264) xxx


Figure 6 € (130,759) xxx

20

© 2

015 D

ragon S

ourc

ing. A

ll rights

reserv

ed.

Highest Annual Saving

C

O

N

F

I

D

E

N

T

I

A

L

C

O

N

F

I

D

E

N

T

I

A

L

C

O

N

F

I

D

E

N

T

I

A

L

C

O

N

F

I

D

E

N

T

I

A

L

Supplier with highest annual saving for the ancillary system was € 1.3

million



3. Demand Analysis


5. Price analysis




Agenda


15 16 13 10 11 11 9

25 28

27 25 24

19 18

19 18 21

19 19 21

18

12 8 6 12

4 4

4 3 5 4

2 3

3

5 5 5

5

5 4

0

10

20

30

40

50

60

70

80

90

# DSCN/BB24 # DSCN/BB30 # DSIN/BB31 # DSCN/BB28 # DSCN/BB27 # DSIN/BB26 # DSSK/BB25

China China India China China India South korea

Business information 20% Production 30% Quality system 25%

RFQ 15% Cooperation 5% Corporate Responsibility 5%

Balance Score card used to rank the suppliers

India

80 77 77 75 64 62 48

Submitted

only RFI

Average RFI scoring: 69 from 100



3. Demand Analysis


5. Price analysis




Agenda


RFI Score 80

RFI Ranking 1

Willing to offer DDP price Yes

Payment terms30 days from

invoice

Page 1-5

COMPANY INFORMATION

Company Name DSCN/BB24

Address XXX

City XXX

Province XXX

Company Website XXX

CONTACT PERSON INFORMATION

Contact Person XXX

Title Marketing Manager

Email XXX

Tel XXX

Fax XXX

Mobile phone XXX

BUSINESS INFORMATION

Year Founded 1994

Nature of the Company Private

Company type (manufacture, trader) Manufacture

Registration Capital (Euro)

Total Employees

Main production items

Factory size (m²)

Export License

Years of export experience

Participated directly in the "OJEU"

Subsidiary in Europe, Australia &

New Zealand

Have Account Manager able to

communicate effectively in English

BUSINESS INFORMATION

Turnover

Million in Euro

2015 (till date) 2014 2013

Percentage of

turnover

distributed to: (%)

Domestic Europe U.S. Rest of the

world

Top 5 Customers?

Customers Industry Country % of sales

XXX Medical China 8%


XXX Medical Cuba 6%

XXX Medical Germany 5%


Ever exported any

of

these items

Whole Blood Bag

System

Ancillary Blood

Systems

Secondary components like

needles, sample site

coupler,etc.

Yes Yes Tes

CORPORATE RESPONSIBILITY & POLICIES

Policies your

organization

hold. (Yes/No)

Health & Safety Policy Yes

Environmental Policy Yes

Quality Policy Yes

CSR (Corporate Social Responsibility) Yes

• Section: Business Information


• Section: Quality Control

QUALITY CONTROL

Certified with Yes / No Date of

Certificate Certifying Org.

Manufacturing QMS

ISO 9001

ISO 14001

ISO13485

Others

International/domestic product certification

CE marked as Class IIb medical devices

EN/ISO 3826- Part 1:

EN/ISO 3826- Part 2

EN/ISO 3826- Part 3

Principles of EU GMP: EN ISO 13485

FDA Approved

Quality control equipment in-house

Test

UV-visible range spectrophotometer

Total organic carbon analyzer

High performance liquid chromatography

Electronic analytical balance

Automatic optical rotation

centrifugal machine

mould Incubator

Have daily in line quality inspection

Type of inspection for finished goods

Performance achieve on average in out going quality measures

Internal rule for advising time of quality claim

Research and development department in-house

Accept 3rd party QC

Contract Management: Attend the Supplier Liaison Meetings

Contract Management: Attend the Framework Review Meetings

Test company do with an external supplier

Have testing methodology of EN ISO 3826 parts 1 and 3 for the specific chemical,

biological and physical tests that must be carried out to validate the production process

and batches of blood bags.

26

Factory overview from outside Office Raw Material/Finished Goods warehouse

Production Floor Production Floor Accurate solutions filling equipment

Assembly lines (semi-automated) Assembly Floor R&D/Lab

© 2015 Dragon Sourcing. All rights reserved. Page 5 - 5

• Section: Factory Pictures


Potential

Savings

Whole Blood Collection Systems including

Leucodepletion Filters,

Identified suppliers with annual savings of € 6 million

Ancillary Blood Processing Systems

Identified suppliers with annual savings of € 1.3 million

Savings from both Chinese & Indian

In summary, a savings potential of 25%

Economy & Finance

Blood Collection System Asia Sourcing Case Study