**1. Introduction**

Pharmaceutical procurement in Thailand has a long history of deconcentration of procurement management and decisions to the Provincial Health Office (PHO) and all public hospitals. This includes the delegation of power to generate, retain, and use financial revenues according to regulations and subject to regular audits by the auditor general [1]. Thus, purchasing for hospital pharmaceuticals is strongly decentralized. Before the deployment of the Public Procurement Act BE 2560 (AD 2017) in 2017, the single selection criterion in the tender or bidding, as called in Thailand, was the lowest price. Since the establishment of Public Procurement Act, the bidder selection for multisourced supplies, including pharmaceutical and medical products,

has been expanded beyond "price" to "price-performance" in order to align with the principles of the Act concerning worthiness, transparency, efficiency, effectiveness, and accountability. While public hospitals are encouraged to use performance criteria to determine the suppliers for pharmaceutical products, there is still a lack of a standard definition of what these criteria encompass and how important each of them is in making the decision. This may lead to a high level of variation between the hospitals on the formulary composition and in the methods used to shape the specific bidding process. To increase the overall quality and transparency based on the Public Procurement Act BE 2560 (AD 2017), the government is now requiring a solid rational and transparent documentation of hospital purchasing decisions.

Multiple-criteria decision analysis (MCDA) is a method which has been suggested as a tool for the evidence-based assessment of multisource pharmaceuticals in developing countries [2]. MCDA can help to consider multiple and sometimes conflicting criteria in the evaluation of the available alternatives [3].

By considering multiple criteria, individuals or groups can follow an explicit structure for arriving at a decision that best fulfills the criteria [4]. In 2016, a task force of the International Society for Pharmacoeconomics and Outcomes Research (www.ispor.org) set out to give guidance for the best practices of MCDA in healthcare decision-making [5, 6]. In this, the development and use of MCDA are described as an iterative process containing several elements, which may be adapted to the specific use by the key stakeholders involved in the decision. At the start, it is important to define the decision problem with the objective, the stakeholders, the expected alternatives, and the expected output. Based on this, criteria for evaluation can be determined which reflect the important attributes or drivers for the success in the decision. For each of the criteria, a scoring scale or graduation needs to be determined. If the criteria (or attributes) have a different importance in reaching the overall objective, the criteria will have to be weighted according to their importance [5, 6].

In the actual evaluation of the alternatives, the performance in each criterion is scored separately for the available alternatives and contributes with the predetermined weight, according to its relative importance, to the composite score reflecting the overall performance of the alternative.1 When comparing alternatives, the MCDA will result in a "score profile" for each alternative and a composite score, which is generated by the MCDA model. The result is not the decision but structured information to better inform the decision to be made. MCDA is being used widely to inform decision-making in healthcare, including benefit-risk assessment of medicine, formulary listing, or reimbursement decisions [5, 7]. Examples for using MCDA in decision-making for multisource medicines in developing countries are emerging in several countries such as China, Thailand, or Egypt [8, 9]. MCDA could be a solution for hospitals in Thailand to select those products which best meet the needs of the patients, providers, and the national policy makers for healthcare.

Thailand has a strong history of using multiple-criteria decision analysis (MCDA), considering the value of pharmaceuticals as an important component in pharmaceutical policy planning, price negotiation, development of clinical practice guidelines, and communication with health professionals [10, 11]. It has been recognized that MCDA enhances the legitimacy of policy decisions by increasing the transparency, systematic nature, and inclusiveness of the process [10]. Examples for using the MCDA method on a national level for rational, transparent, and fair priority setting in the context of single-source drugs have been described [12].

The objective of this initiative was to develop a simple tool for improving decision-making in the hospital bidding setting, based on the MCDA methodology,

<sup>1</sup> A short explanation of MCDA in lay language (English) can be seen under https://www.youtube.com/ watch?v=7OoKJHvsUbo.

*Weighing Price and Performance for Decisions for Multisource Pharmaceutical Bidding in Public… DOI: http://dx.doi.org/10.5772/intechopen.83823*

through a multi-stakeholder workshop format to attain consensus. This tool should integrate a set of standard decision criteria, which (1) can be used by hospital purchasers to base bidding decisions on both performance and price, (2) would be applicable across diverse hospitals and institutions, but (3) would also allow for adaptation to local priorities.
