By Letter No. IA/83689/20 dated September 28, 2020, the Federal Antimonopoly Service of Russia (FAS Russia) issued clarifications regarding public procurement procedures for single-use medical devices manufactured from polyvinyl chloride (PVC) plastics.

The regulator released this guidance in response to shifting market dynamics, specifically sharp foreign exchange fluctuations. These macroeconomic factors drove current market prices for PVC medical devices above the pricing thresholds established by contracting authorities under the methodology approved by Joint Order No. 759n/3450 of the Ministry of Health and the Ministry of Industry and Trade dated October 4, 2017. Consequently, numerous public tender processes failed or were officially declared unsuccessful because bidders could not legally submit proposals below actual market value.

Under existing rules, the Analytical Center for the Government of the Russian Federation calculates the weighted average price annually by November 1 to justify the Initial Maximum Contract Price (IMCP) for each respective calculation period. Currently, state contracting authorities must rely on weighted average prices calculated prior to November 1, 2019, to determine and justify the IMCP.

Current statutory frameworks do not provide specific fallback mechanisms for recalculating the IMCP when a medical device procurement fails due to a lack of bids. This contrasts with the pharmaceutical sector, where Ministry of Health Order No. 1064n dated December 19, 2019, outlines distinct procedures for failed drug procurements. Furthermore, the standard medical device regulations do not permit authorities to adjust the IMCP based solely on prevailing market prices.

These rigid regulatory constraints have led to systemic disruptions in procuring socially significant medical devices essential to the daily operations of healthcare facilities, threatening the continuous and uninterrupted delivery of medical services.

To resolve this issue, FAS Russia determined that if a public procurement process is declared unsuccessful for the reasons stated above, contracting authorities have the legal right to initiate a re-tender. Provided that the technical specifications and conditions of the initial failed tender remain identical, authorities may utilize the comparable market price method (market analysis) to justify the IMCP pursuant to Article 22 of Federal Law No. 44-FZ. The antitrust regulator confirmed that implementing this method under these specific conditions will not constitute a violation of current public procurement legislation.

It is worth noting that this administrative relief serves as a temporary measure. There is an evident need to amend Government Decree No. 102 dated February 5, 2015, as well as the joint pricing methodology approved by Order No. 759n/3450 dated October 4, 2017. Permanent legislative updates are necessary to mitigate supply chain risks arising from currency fluctuations and broader market volatility.