Blood collection system - Asia Sourcing

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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 & 33. 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

ThailandVietnam

Pakistan

Malaysia

IndonesiaSingapore

Philippines

South Korea Japan

Taiwan



3. Demand Analysis


5. Price analysis




Agenda

© 2015 Dragon Sourcing. All rights reserved.. 6

Approach & Schedule,

No. Step Deliverables

1.Demand AnalysisWork 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 AnalysisIdentify 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-screeningSelection 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/RFQPrepare 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 AdministrationThe 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 ResponsesAnalysis 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

Steps Duration/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).

SystemWhole Blood Collection

Systems including Leucodepletion Filters

Image Remark Forecasted Qty Y3 (Systems)*

1Top and Top (TAT) Blood

collection system for whole blood filtration

Nil 1.7 M

2Bottom 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

4 Whole blood collection system without anticoagulant

Note: This Blood collection system is a dry system which contains no anticoagulant. XXX

XXXX

X

AB C

D EF

G H

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

Suppliers identified Failed phone screening Passed phone screening

5547

8

47

33

14

6

5

1

5

5

5

5

5

4

1

5

4

1

4

3

1

3

3

3

3

3

3

1

1

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

32

7

9

68

Traders/importer only, not a manufacturer

Manufacturing secondary components only, Unable to supply complete blood bag system.

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 Parent company, 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• OthersYour 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 infoConfidential

DS Contact Person Mr Pankaj TutejaEmail [email protected] number +91- 22- 26365009Mobile + 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 detailinformation

Productioninformation


RFI-RFQ sent Intend To Respond

Don’t Intend to respond

Only RFI Received

RFI-RFQ received

14

4

10

4

8

2

6

2

1

1

1

1

1

1

1

1

1

Singapore

South Korea

Pakistan

Japan

India

China

15

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/RFQ Analyse RFI/RFQ received

Xinjiang

Gansu

Jiangxi

Tianjin

Jiangsu

Guangxi

Hunan

Hubei

Qinghai

Ningxia

ShaanxiAnhui

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

Similarly other Countries suppliers location were highlighted.



3. Demand Analysis


5. Price analysis




Agenda


- Logistics Process: DDP Price Calculation- From FOB China & India to DDP Europe destination.

EXWPrice

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.

DDPPrice

FOBPrice

Delivered price until client warehouseChinese & Indian suppliers quotation

Country Supplier Product #

Supplier DDP Price

(Euro/System)Supplier Annual

spendSupplier 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 MFigure 2 € 3.02 xxxFigure 3 € 0.21 xxxFigure 4 € 0.23 xxx

China# DSCN/BB30


Figure 1 € 2.03 1.7 MFigure 2 € 1.47 xxxFigure 3 € 0.25 xxxFigure 4 € 0.16 xxx

China# DSCN/BB28


Figure 1 € -1.77 1.7 MFigure 2 € -1.49 xxxFigure 3 0.04 xxxFigure 4 0.20 xxx

China# DSCN/BB27


Figure 1 € -4.90 1.7 MFigure 2 € -8.03 xxx

Figure 4 € 0.18 xxx

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

India# DSIN/BB26Total annual

saving € 0.19 M

Figure 1 € -10.22 xxxFigure 2 € -11.62 xxx

Figure 4 € 0.19 xxx


Supplier with highest annual saving was about € 6 millionHighest Annual Saving

CO

NFIDE

NTIAL

CONFIDE

NTIAL

CO

NFIDE

NTIAL

CONFIDE

NTIAL

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


Figure 1 € 21,795 6,000 Figure 2 € 15,621 xxx Figure 3 € 15,621 xxx Figure 4 € 25,769 xxx Figure 5 € 25,131 xxx Figure 6 € 64,722 xxx Figure 7 € 71,014 xxx Figure 8 € 54,951 xxx Figure 11 € 49,832 xxx Figure 13 € 238,528 xxx Figure 14 € 49,622 xxx

China # DSCN/BB30


Figure 1 € 20,960 6,000 Figure 3 € 6,625 xxx Figure 5 € 23,488 xxx Figure 7 € 163,215 xxx Figure 8 € 143,297 xxx

China# DSCN/BB28


Figure 1 € 30,534 6,000 Figure 2 € 24,487 xxx Figure 3 € 25,901 xxx Figure 4 € 52,220 xxx Figure 5 € 26,394 xxx Figure 6 € 153,818 xxx Figure 7 € 170,604 xxx Figure 8 € 170,604 xxx Figure 11 € 92,880 xxx Figure 13 € 462,338 xxx Figure 14 € 93,956 xxx

India

# DSIN/BB31


Figure 1 € 8,145 6,000 Figure 2 € (4,455) xxx Figure 3 € (4,455) xxx Figure 4 € (32,264) xxx Figure 5 € 16,227 xxx Figure 6 € (130,759) xxx

20

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015

Dra

gon

Sou

rcin

g. A

ll rig

hts

rese

rved

.

Highest Annual Saving

CONFIDE

NTIAL

CONFIDE

NTIAL

CONFIDE

NTIAL

CONFIDE

NTIAL

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



3. Demand Analysis


5. Price analysis




Agenda


# DSCN/BB24

# DSCN/BB30

# DSIN/BB31 # DSCN/BB28

# DSCN/BB27

# DSIN/BB26 # DSSK/BB25China China India China China India South korea

0

10

20

30

40

50

60

70

80

90

14.933333333333316.066666666666713.0666666666667 9.75 10.533333333333310.68333333333339.03333333333334

24.5 27.526.5

24.75 24.125 18.5 18.25

18.7517.5 21.25

18.75 18.7521.25

17.5

12 8 612

4 4

4.33333333333333 3 5 4.33333333333333

2 3.33333333333333

3

5 5 5 5

5 3.75

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 terms 30 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

TestUV-visible range spectrophotometerTotal organic carbon analyzerHigh performance liquid chromatographyElectronic analytical balanceAutomatic optical rotationcentrifugal machinemould 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


Page 5 - 5

• Section: Factory Pictures


PotentialSavings

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%

Services

Blood collection system - Asia Sourcing