Overview

Only two companies in the Canadian market are able to provide the full spectrum of products to be considered as a hospital supplier. In 2022, Canada’s supply of infant formula was severely limited when one of those companies was forced to close a U.S. manufacturing facility for four months. At the time of the shutdown, the company that operated that facility had the contract to supply formula to over 80% of babies in Ontario hospitals.

The Challenge

In the midst of the 2022 supply disruption, Mohawk Medbuy (MMC) needed to establish a new contract for formula for our Member hospitals. Ensuring a stable supply of product was the main strategic focus of the Request for Proposal (RFP). 

“I was pleased to see that in the new RFP, supply stability would be weighted more heavily in importance than other factors,” said Elena Nikolsky, Senior Clinical Program Director for the Women’s and Infants’ Health Program at Mount Sinai Hospital. “Ensuring an uninterrupted supply of formula was the biggest concern for our clinicians and our patients’ families. We’re confident this new contract will provide that.”

The outcome

As an outcome of the innovative RFP process, the infant formula supply contract is now much more evenly split between the two major suppliers to Canada – with about 50% of MMC Members choosing each supplier. Ontario hospitals are now much less vulnerable to a supply disruption – a win for hospitals, clinicians and families. 

“Supply disruption and clinical quality was top of mind in the evaluation criteria,” said Kieran Scott, Director of Strategic Sourcing at MMC. “The financial analysis is unique in this contract because it is applied to revenue-generating proposals rather than expenses.”

Procurement Benefits