New Zealand Blood Service 2005 Annual Report

29 September 2005

New Zealand Blood Service 2005 Annual Report

The New Zealand Blood Service (NZBS) today released its annual report in respect of the 2005 financial year. NZBS is the Crown Entity which provides blood products and services to the people of New Zealand.

Chairman Warren Young says the latest year was another successful one for NZBS. A small net surplus of $12,000 was achieved which was viewed as commendable in a period of sharply rising costs particularly in the area of employment. "However, our ability to continue to substantially offset increased expenditures with operational and efficiency improvements is now decidedly limited," he said. "Although we are again predicting a break even outcome for the 2005/6 year we view this as a stretch target, especially at a time when NZBS is also radically changing its product range."

"Moving forward, we have a number of strategic considerations which could materially change the nature of our business," said Mr Young.

"The advent of the Trans-Tasman Joint Regulatory Agency has the capacity to significantly influence the framework and standards under which NZBS operates, and the cost structures associated with those functions, " Mr Young said. "It is important that NZBS is forewarned of the likely nature and extent of the regulations which come into effect on 1 July 2006 so that we have sufficient time to modify our systems to accommodate the new regime."

On 1 July 2005 NZBS introduced Biostate®. This is a third generation plasma derived Factor VIII product used for treating haemophiliacs, and its manufacture includes further viral inactivation steps as well as a separate purification process. "It is therefore of higher purity and has a very much enhanced safety profile", Mr Young stated. "But it comes at a significantly greater cost to produce and our prices to District Health Boards (DHBs) will need to be adjusted accordingly," he said.

"There is also the short term prospect of the DHBs moving to a synthetically produced recombinant alternative to the historical plasma derived products", Mr Young said. "We are currently working on a strategic plan which will better define the use of Biostate®, the path and timing of the transition to a chosen recombinant alternative, and the process by which these critical events will be co-ordinated and managed."

The results of initial benchmarking undertaken by NZBS against counterpart international blood services indicates that the New Zealand operation is amongst the best in the world in terms of product cost, pricing to customers, and overall production efficiency. "In achieving these outcomes," Mr Young said "we have not in any way compromised issues of safety or appropriate levels of blood availability, and New Zealand remains one of the few countries in the world which is self sufficient in whole blood and plasma collection."

ENDS

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