1. 1 Public Procurement of Innovations a driver for future health in Europe - Stockholm, 13 October 2009 Public Procurement Directives supporting innovation Jaroslav Kračún legal officer, Unit C3 European Commission DG Internal Market and Services Directorate C – Public Procurement Policy

2. 2 Summary I.Innovation drive within PP Directives A.General procedures B.Competitive Dialogue II.Commission initiatives supporting Innovation in Public Procurement A.Pre-Commercial Procurement B.Lead Markets Initiative

3. 3 Innovation ability to take new ideas translate them into commercial outcome using new processes, products or services in a way that is better and faster than competition impossible to be organised by regulations state of mind of market actors should be supported by the legal framework

4. 4 Why innovation in PP? to enhance European competitiveness in globalised economy to address important issues: –climate change, –non-renewable resources, –demographic change, etc. public procurers: –16% of GDP –specific sectors with specific competition –should act as “intelligent” customers

5. 5 Part I Innovation within Public Procurement Directives 2004/17/EC and 2004/18/EC A.General procedures B.Competitive Dialogue

6. 6 A. General Procedures i.Technical specifications referring to: –Technical specifications and standards –Performance and functional requirements ii.Award criteria: –Lowest price –Economically most advantageous tender

7. 7 i. Performance and functional requirements early communication to allow market to adapt pooling of resources for technologically demanding solutions consulting the market before tendering allowing market to propose creative solutions – asking for solution, not prescribing it

8. 8 ii. Economically most advantageous tender Taking into consideration: technical merits better quality achievements life-time costs –energy efficiency –maintenance costs –reliability

9. 9 B. Competitive dialogue i.Specific conditions of application ii.Risks to be avoided

10. 10 i. Specific conditions of application Formalised dialogue to explore the development of best solutions that are particularly complex for a specific product or service –impossibility to define the technical means –inability to determine among different solutions Economically most advantageous tender

11. 11 ii. Risks to be avoided confusion with negotiated procedure maintain competition non-discriminatory criteria equal information sharing among operators final fine-tuning: no major modification of the tender

12. 12 Part II Commission initiatives supporting Innovation in Public Procurement A.Pre-Commercial Procurement B.Lead Markets Initiative

13. 13 A. Pre-Commercial Procurement i. Applicability –R&D services within specific exclusion of PP Directives –risk-benefit sharing –exclusion of State aid ii. Double phase procurement process –Pre-commercial phase –Commercial phase

14. 14 i. Applicability R&D services other than those where the benefits accrue exclusively to the contracting authority for its use in the conduct of its own affairs, on condition that the service provided is wholly remunerated by the contracting authority Risk-benefit sharing: –lower price for procurers for not keeping all IPR –opportunity/risk for operators to resell the solution State aid exclusion: –price reflecting operator’s benefit from IPR ownership

15. 15 ii. Double phase procurement process

16. 16 ii. Double phase procurement process

17. 17 B. Lead Markets Initiative i. General description –6 markets with innovation potential growth –4 sectors of public intervention measures ii. e-Health –networking of public procurers –funding under CIP and FP7 calls for proposals CIP – Competitiveness and Innovation Framework Programme FP7 – Seventh Framework Programme

18. 18 i. General Description Lead Market: a market for innovative products and services or technological solutions with high growth potential a market where EU industry can develop competitive advantage to lead in international markets a market that requires action by the public authorities to deal with regulatory obstacles Lead Market Initiative: identifies first set of markets and brings action plans in order to rapidly bring visible advantage for Europe’s economy and consumers

19. 19 i. General Description Lead Markets: bio-based products e-Health sustainable construction protective textiles recycling renewable energy

20. 20 i. General Description Coherent action package in 4 sectors: public procurement standardisation legislation complementary support

21. 21 ii. e-Health EU Health sector: 10% of the total workforce 9% GDP – expected at 16% by 2020 better care for less money citizen-centered health delivery systems encouraging innovation in other market segments: –pharmaceuticals –medical devices

22. 22 ii. e-Health Roadmap of policy recommendations for 2008- 2010 by EC-wide e-Health Task Force http://ec.europa.eu/information_society/activities/he alth/docs/publications/lmi-report-final-2007dec.pdf http://ec.europa.eu/information_society/activities/he alth/docs/publications/lmi-report-final-2007dec.pdf Action plan addresses 4 identified barriers: –market fragmentation –lack of legal certainty –lack of financial support –procurement issues

23. 23 ii. e-Health Thematic network of public and private procurers under CIP 2009 Call 3: –raise awareness of pre-commercial procurement –exchange of experience –defining needs requiring development of new technology solutions –involving national procurement authorities –financed by the European Commission CIP – Competitiveness and Innovation Framework Programme

24. 24 ii. e-Health Associate procurers in consultation process for CIP and FP7 calls for proposals –www.epractice.euwww.epractice.eu –meeting of e-Health procurers –sharing experience and knowledge –asking for advice and providing support CIP – Competitiveness and Innovation Framework Programme FP7 – Seventh Framework Programme

25. 25 References Communication from the Commission: Pre-commercial Procurement: driving innovation to ensure sustainable high quality public services in Europe, COM(2007) 799 final Communication from the Commission: Reviewing Community innovation policy in a changing world, COM(2009) 442 final http://ec.europa.eu/enterprise/policies/innovation/policy/l ead-market-initiative/index_en.htmhttp://ec.europa.eu/enterprise/policies/innovation/policy/l ead-market-initiative/index_en.htm Pro Inno Europe Paper N°1: Guide On Dealing With Innovative Solutions In Public Procurement, 10 Elements Of Good Practice

26. 26 Contact information Europa website: http://ec.europa.eu/internal_market/pub licprocurement/index_en.htm Jaroslav Kračún jaroslav.kracun@ec.europa.eu

27. 27 Thank you for your attention