Opening speech – Medtech Procurement Conference

Deputy Minister Dilek Ayhan 13. november 2013

*Check against delivery*

Ladies and gentlemen.
Dear all.

First I want to thank The Norwegian Association for Health- and Welfare Technology for inviting me to open this conference.

It is a pleasure to be here today.

I am also happy to see so many participants from our neighbouring Nordic countries.

With all of you gathered here, it bodes well for fostering a strong Nordic health market.

I am honoured to be the first of so many interesting speakers here today.

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Charles Darwin said;
"It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change."

Or as others have put it: Innovate or Die.

One thing is true:
Innovation is absolutely necessary for economic and social development.

In the long term, innovation is the strongest tool to achieve economic growth in our economies.

And the new Norwegian government have been quite clear:
• It will base its policies on first creating values in order to share them.
• And to create values, it will facilitate investment in innovation, research and development

Innovation, knowledge and technology are key priorities when we prepare ourselves to face international competition and solve social challenges.

The government´s long term ambition is therefore to make Norway one of Europe’s most innovative countries.

And we share this ambition with our Nordic neighbours.  
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To achieve this, much is of course required.
But we are convinced that a key role can be played by the public sector.

There are two reasons for this.

First of all:
The public sector has large-scale procurement power.

In the Nordic countries public procurement amounts to almost 15 percent of BNP!

This gives us a unique possibility to create demanding markets.
These markets can produce innovations.
And these innovations can be exported to the rest of the world.

Secondly:
The challenges that we are facing in the health sector in the Nordic countries require innovation.

We need it because of cost concerns.
We need it because our citizens expect better services.
And we need it because our aging population require that we can provide them.

In short:
The public sector can and should be a strong engine of innovation!


National and international studies and experiences support this:

Efficient procurement is a key to;
• better services;
• more innovative enterprises;
• and increased efficiency in the public sector.

Procurement is a great tool for value creation!

And I cannot think about any other sector where this is more important than in the health sector.

In the Nordic countries:
The public sector is the largest supplier of healthcare services.
This also makes it the largest buyer of healthcare products and services.

What we find here is a major opportunity!

If such a large player as the public health sector demands new and innovative products and services, I believe that the private sector suppliers will be able to present them.

In this way, the market usually functions well.
 
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An other aspect is that the global market for health and welfare solutions is expected to grow fast over the next years:

The reason is that our population is getting older and that we expect to see more chronic and lifestyle-related diseases.

So we need to develop better services to take care of our elderly and sick.
This calls for smart solutions.

At the same time this need for innovation, gives opportunities for growth and exports.

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I believe that the Nordic region has a potential to positions itself as frontrunner within healthcare and drive innovation in both the public and private sector.

But before this can happen, there are several challenges to deal with.

And together, I think we can do something about them.

The first challenge is competence.

Various studies indicate that public procurers need to learn more about how their procurements can lead to innovation.

This is a challenge that the Norwegian government takes very seriously.
Like a doctor needs her stethoscope, procurers need the tools and the framework to do their very demanding job.

Placing an order and ending up with the result you wished for, means that you have to know very well what you are ordering!

As always there are brilliant exceptions that set the standard.

And in all Nordic countries there are public bodies who systematically strive to be the best procurers they can be.

One example is when the Norwegian Labour and Welfare Administration wanted to get the best available tools for the hearing impaired.

Then they called on our hosts today; The Norwegian Trade Organization for Health- and Welfare Technology.

This resulted in a mobilization of the industry. And it gave an open and frank discussion of the challenges and possibilities before the tender was issued.

The second challenge is the fear of market dialogue.

Like a fisherman taking soundings under his boat to locate fish;
market sounding should also be standard procedure for procurers.

Only that way the procurer can find out if her need can be met in a new and better way.

Normally, procurers have good time to have a market dialogue before a tender. But the problem is that often, this is not done.

In other words; we need to improve the dialogue between procurers and suppliers.

The Norwegian government expect procurers to undertake market dialogue whenever it is useful. And we expect that they get the necessary support in their organizations in doing this.

The third challenge is to make procurement a central part of the strategy in public bodies.

Public organisations are not yet conscious enough of the potential effects of procurement at a strategic level.

If procurement is seen as an important tool to solve central tasks in the organization, I believe we will also get better procurement and more innovative solutions.

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In order to address some of these challenges, and to make innovation a more integrated part of public procurement, the Norwegian government has in its political platform stated:

• That it will simplify the Public Procurement Act to make it easier for small, innovative actors to submit tenders.

• It will introduce a neutral value-added tax in the public sector and the health enterprises, to allow more private service suppliers to help address society’s needs.

• It will prepare a manual and guidelines for public-private innovation partnership and make sure that public procurement offices make use of them.

• And not least, we wish to professionalize and rationalize public procurement processes, including drawing up a guide for public-private innovation partnerships.

In Norway, various ministries co-operate to bring out the potential for innovation in public health procurement.

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Lastly, I want to mention a fourth challenge, namely the use of existing cross sector and cross border cooperation.

There is already established collaboration in different areas and between different Nordic organizations in the field of health and welfare. 

That is a positive thing.

I believe that this is an important part of creating economy of scale and a bigger home market.

With cooperation, we can both build on existing and develop new tools for innovation.

I want to point to the importance of your efforts today.

What you are trying to achieve here today is to foster more demand driven innovation and collaboration within health and welfare.

I believe that meeting places like this can help the Nordic region in taking the lead and becoming a front runner in health innovation.

This is also the aim of the Nordic program Innovation in the Health Sector through Public Procurement and Regulation .

Very little could be more important and more relevant than what you are doing here today.

For you are creating a meeting place for suppliers and procurers on a Nordic level.

And all of you have innovation and better solutions in mind!

I have also been glad to note that the Swedish government signals that innovation friendly procurement should be a part of the forthcoming Nordic innovation program.

For I think there is a huge potential for the Nordic public sector to foster innovative and smart health and welfare solutions.

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To sum up:
The Norwegian government´s long term ambition is to make Norway one of Europe’s most innovative countries.

And a large role will be played by the public sector:
• Through its procurement power.
• And through addressing needs and opportunities that follows demographic changes.

Challenges must be faced.

But the Norwegian government have already realised that innovation should be a more integrated part of public procurements. And it will work to realize what it has promised in its platform.

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We already see examples of good work in the area of public procurement and innovation.

And I believe that the arena you are creating here today, is an example of how to take things further.

I am glad to know that you will use this arena to network, to establish new valuable contacts and to create grounds for innovation through health procurement.

I wish you all a successful conference

Thank you for your attention.
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