NEDA Board approves revised structure for UP-PGH Cancer Center PPP Project

UP System Administrator

May 2

*Perspective of the UP-Philippine General Hospital Complex in Manila. Illustration from the Public-Private Partnership Center.*

The public-private partnership (PPP) for the University of the Philippines-Philippine General Hospital (UP-PGH) Cancer Center Project has taken a big step forward from its February 2023 initial approval with the National Economic and Development Authority (NEDA) Board's approval of its detailed specifications, as well as its updated parameters, terms, and conditions.

The project—a 300-bed, state-of-the-art cancer hospital to be built in the UP-PGH compound in Manila—is a critical step toward addressing the expected rise in the incidence and mortality of the disease. Cancer is the second leading cause of death in the country, with 113,000 deaths and 188,000 new cases in 2022 alone. There are now more than 466,000 Filipinos living with cancer.

UP-PGH, the National University Hospital and one of the country's leading public hospitals, will dedicate 150 beds to charity patients. UP-PGH's private sector partner will be allocated the remaining 150 beds to serve private patients.

With the December 2023 passing of Republic Act No. 11966 (PPP Code of the Philippines) and the subsequent issuance of its Implementing Rules and Regulations, key changes to the project parameters, terms, and conditions were introduced. These are also intended to improve the project's financial sustainability over the concession period. Among the changes were improvements in the annual payment mechanism and equipment supply and financing, and requirements to meet recognized standards for global best practice. These were aimed at having a facility that is designed to allow UP-PGH doctors to deliver patient care and education in a manner that is safe, efficient, and responsive to evolving technologies and clinical norms.

*15th NEDA Board Meeting on April 25, 2024. Screen capture from the RTVM YouTube channel.*

Under the 30-year build-transfer-operate concession, the private partner will design, finance, construct, and commission the standalone hospital, as well as procure, maintain, and provide periodic replacement of medical and non-medical equipment. The private partner will also operate and maintain all non-clinical services, such as facility maintenance and management, cleaning, laundry, and catering, as well as parking and retail outlets.

The private partner will be selected through an open, single-stage competitive tender based on the lowest annual payment. Revenues from clinical services to private paying patients and commercial activities will enable the private partner to lower the annual payment. This makes the project more affordable amid the numerous health infrastructure projects the government has to fund. This aligns with the current administration's thrust to leverage the private sector to address the significant health infrastructure needs of the country.

The tender process is underway. "We are encouraged by the participation of four credible bidders in the tender process," said Dr. Gerardo Legaspi, Director of UP-PGH. "Their feedback has been instrumental in refining the project parameters, terms, and conditions. We hope this will make the process more competitive and attract additional bidders, leading to a project that stands a greater chance of attracting financing at a lower cost."

UP President Angelo Jimenez echoed this sentiment, adding, "We want to improve in general as part of our mandate as the national university, and we are aiming to meet global standards of medical care for the Filipino people."

Bidding is open to all interested parties, whether local or foreign, subject to conditions for qualification under the Bidding Documents. An updated Project Brief and purchase instructions for the Bidding Documents, which include the Instructions to Bidders, the Concession Agreement Term Sheet, and the draft Concession Agreement and its Schedules, are available on https://ppp.gov.ph/ppp_projects/pgh-cancer-center.

Media contact:
Dr. Gerardo D. Legaspi, MD
od.uppgh@up.edu.ph
(02) 8554 8400