Multimillion pound procurement contracts are set to be awarded to the incumbent purchasing providers to the NHS, HSJ can reveal.

Several sources have told HSJ the Department of Health is set to name DHL and the NHS Collaborative Procurement Partnership as winners of up to three contracts each, amid a major overhaul of NHS procurement.

Nhs supply chain van


Forty per cent of NHS spending on equipment goes through the NHS Supply Chain

Ten contracts were put on the market by the DH in December for the procurement of goods within 10 categories of medical equipment, capital equipment and other areas of NHS expenditure such as food and hotel services.

Winners of the first batch of six contracts have yet to be announced by the DH, but HSJ understands DHL and the NHS CPP are among them.

The six contracts are for the procurement of everyday and high value healthcare consumables, and are worth a combined total of £112m.

As part of the bidding process, DHL is believed to have partnered with Oxford Academic Health Science Network and American health analytics company Vizient.

Sources have also told HSJ the NHS CPP is the preferred bidder for the category covering orthopaedics, trauma and spine, and ophthalmology equipment.

Two sources said DHL and the NHS CPP are set to be awarded three contracts each, which is the maximum number of categories an organisation can procure goods for the NHS under the new model. This has not been confirmed by DH.

If this went ahead, it would mean the six contracts being awarded to the organisations who already buy the majority of these goods on behalf of the NHS.

Of the health service’s £5.7bn annual expenditure on the equipment covered by the 10 contracts, 40 per cent goes through the NHS Supply Chain run by DHL.

Another 40 per cent is carried out through regional procurement hubs. The NHS CPP has 145 NHS trusts as members, as well as clinical commissioning groups and commissioning support units.

The remaining 20 per cent of expenditure is managed by individual trusts.

The DH hopes the new model will increase the NHS’s collective market share from 40 per cent to 80 per cent.

HSJ has previously reported that two other organisations with experience of NHS procurement, Healthtrust Europe and NHS Shared Business Services, have not submitted bids.

The DH has not confirmed HSJ’s information about successful bidders. The six contracts were originally planned to be awarded last month.

A DH spokeswoman said: “Commercially confidential discussions are still taking place. We will announce successful bidders in due course.”

Spokespeople for DHL, the NHS CPP and Oxford AHSN said they would not comment. HSJ did not receive a response from Vizient.

The contracts are part of a wider overhaul of NHS procurement that the DH hopes will result in savings of at least £600m by 2021-22.

Under its “future operating model” the DH will replace the NHS Supply Chain in October 2018 with the organisations selected to buy goods for the NHS across 11 categories. These will collectively be called the “category towers”.

Crown Commercial Service was awarded the stationery category without competition. This “tower” has already gone live.

The procurement organisations will be overseen by a 200 staff management body called the “intelligent client coordinator”, which is being set up with the help of EY.

Separate providers for logistics, transactional and IT services to support the towers are also being sought by the DH.