From public outrage to public trust

1. From public outrage to public trust Overcoming a Risk Disaster: Lessons Learned at Canadian Blood Services Ian Mumford Chief Operating Officer Canadian Blood Services To the Regulatory Craft in Nova Scotia Conference Halifax, September 30, 2008

2. Public trust: bedrock of the blood system • Blood products are ubiquitous life-saving commodities • Blood and blood components are freely donated, relying solely on public generosity and goodwill • Some products have a shelf life of just a few days • There are no effective substitutes for human blood • Product safety and security of supply are the foundations of public trust in the system • Any serious compromise to these foundations has dire, long-term consequences

3. The truths of trust • Trust is never a goal unto itself • Trust is earned by consistently meeting – but preferably exceeding – the expectations of customers, stakeholders and the Canadian public • Focus on safe, secure, cost-effective, affordable and accessible supply of quality blood and blood products and trust will automatically follow • A trusted individual or group is typically taken for granted

4. Canadian Blood Services’ Public trust model Points of change(Internal) Points of influence(External) Effective, visible change leverages influence Influence leverages trust

5. Public trust in 1998, had fallen to about 50% Public trust in the blood system is strong Percentage of Canadians expressing trust in the blood system managed by CBS (7+ on a 10 point scale) from third-party polling data

6. Overview • An overview of Canadian Blood Services • Starting afresh: vision for change • Canadian Blood Services today: a transformation realized • A glimpse into the future • Risk management: foundation of quality • How Canadian Blood Services manages risk

7. CBS at a glance MANUFACTURING COLLECTIONS DISTRIBUTION ProductionTestingInventoryR&DEducation Serve732 Healthcare Facilities ~415,000ActiveDonors • 4,700+ employees • 17,000+ volunteers, ~250,000 hours • 40 permanent collection sites • 19,000 mobile collection clinics • 12 manufacturing centres • 3 blood-testing centres • 872,506 whole blood donations (freq = 2.18) • 51,770 apheresis plasma donations (freq = 8.67) • 36,179 apheresis platelet donations (freq = 5.15) • Est. 600,000 patient transfusions a year Fiscal 2007/08

8. Canadian Blood Services provides a broad range of blood-related services • Blood operations: • Recruit donors, collect blood, manufacture components, test, distribute to hospitals • Plasma program: • Collect plasma, custom fractionation, acquire plasma derivatives, recombinant proteins and synthetic equivalents • Related Programs: • Education, research & development, clinical consultation • OneMatch Stem Cell and Marrow Network: • Linked to 51 other registries worldwide • Diagnostic laboratories • Insurance Captives: • Two wholly owned subsidiary companies to underwrite catastrophic loss • Canadian Blood Services Fundraising Office: • To support and extend the mission of Canadian Blood Services

9. Basic blood facts • Only 3 1/2% of eligible Canadians donate blood. • Most common type: O Rh-Pos (31%) • Rarest type: AB Rh-Neg (0.7%) • Highest demands:A and O • Aligning supply and demands is a key issue because of limited shelf life of some products: • Red blood cells: up to 42 days • Platelets: 5 days • Fresh frozen plasma for transfusion: 1 year • Source plasma for fractionation: 10 years

10. Born in an environment of failure and scandal

11. Who is Canadian Blood Services? • Founded in 1998 as the successor organization to the Canadian Red Cross • For over 50 years, Canadian Red Cross operated Canada’s blood supply system • Early 1980s to mid 1990s: • tainted blood scandal • largest public health crisis in the history of Canada • Culminated in the Krever Commission of Inquiry on the Blood System in Canada

12. Krever recommendations set change agenda • More openness and transparency • Clear accountability • Informed decision-making • A national system under a single operator • Sufficient funding and contingencies to eliminate risks from financial compromise • Improved regulation and regulatory framework • Better transfusion practices • More R&D

13. …all to ensure that blood safety is paramount • Krever Commission report emphasized the Canadian blood supply should be governed by five basic principles: • Blood is a public resource • Donors of blood and plasma should not be paid for their donations • Whole blood, plasma and platelets must be collected in sufficient quantities in Canada to meet domestic needs • Canadians should have free and universal access to blood components and products • Safety of the blood supply is paramount

14. The Commission of Inquiry on the Blood System in Canada • Federal government determines need for a commission of inquiry • Justice Horace Krever, appointed by Order in Council, October 4th 1993 • to review and report on the mandate, organization, management, operations, financing and regulation of all activities of the blood system in Canada • Justice Krever tables an Interim Report • February 15th 1995 • 43 recommendations focused on operational, technical and clinical aspects of blood system at the time • Work on final report continues • 247 days of hearings from 474 individuals • phase I – input from those infected with HIV or HCV • phase II – national issues concerning historical actions and relationships • phase III – organization of the blood system at the time • appeals under Section 13 of the Inquiries Act caused significant delays • final report released November 26th, 1997

15. Legacy – Krever Commission of Inquiry 29 - 45: The Regulator – The Health Protection Branch • Health Canada’s regulatory oversight over CBS has improved substantially: • Attempts to make regulatory framework active and risk-based • Commitment to adhere to its own performance standards for review (however resources constraints negatively impact CBS) • Willingness to examine more streamlined approaches to review and approval • Over zealous inspection process, still very task focused rather than process oriented • Limited evidence of openness of decision making • Active hemovigilance program developing • A series of recommendations aimed at the Federal regulator, arguing for: • Active, risk-based regulation (intelligibly written) • Independent decision making that is accessible and open to public • Permitting manufacturer to exceed standards • Post-market surveillance (hemovigilance) • Frequent and thorough inspections • Adequate resources • International harmonization

16. PROVINCES/ TERRITORIES • Funding of Blood Operators • Regulate Health Professions • Medical practice (hospitals) • Public Health • FEDERAL (HEALTH CANADA) • Regulation (Food and Drugs Act) • Establishment Licensure • Compliance and enforcement • National Disease Surveillance SAFETY • OPERATORS (CBS/HQ) • Donor recruitment • Product collection, manufacture and testing • Acquisition, distribution of derivatives • One Match Registry • OTHERS • Donors & Recipients • Non-governmental organizations • Advocacy groups • Health professionals Blood safety: A broadly shared responsibility

17. Tragic and costly lesson • Investment in blood safety is increasingly resource intensive • Failure to invest in safety interventions costs far more than the interventions themselves • cost of loss of trust • cost of loss of supply • cost of compensation programs for injured

18. Picking up the pieces • Collections had seriously declined • Public confidence in blood was low and sinking • Totally demoralized staff • Operations consisted of 14 disconnected “silos” across Canada • Decayed infrastructure and technology • Inadequate quality systems

19. Canadian Blood Services: A new organization with a new governance model… • Arm’s length, not-for-profit agency “independent” of government • Regulator: Health Canada (Blood is classified as a drug under Schedule D of the Food and Drugs Act) • Exclusively serve 9 provinces and 3 territories • Funded by Provinces and Territories (except QC) • Global budget; no charge to hospitals • Operating budget FY2008-09 ≈ C$915 million

20. A clear sense of mission… • Mission statement • Canadian Blood Services operates Canada’s blood supply system in a manner that gains the trust, commitment and confidence of all Canadians by providing a safe, secure, cost-effective, affordable and accessible supply of quality blood, blood products and their alternatives

21. A clear mandate… • Rebuild the blood system in Canada • Regain the trust of Canadians in their blood supply • Create risk management programs aimed at preventing future catastrophes • (Province of Quebec established an independent agency in 1998, Héma-Québec)

22. Multi-step action plan to get from there to here • Phase 1 – Transfer of legacy operations • Phase 2 – Fully transform Canadian Blood Services into a truly national integrated service-delivery organization focused on quality and service excellence • Phase 3 – Evolve to a full-integrated national system based on real-time demand forecasting and advanced collections technology NOTE: All changes to Canada’s blood system take place amid a business-as-usual environment in meeting the nation’s blood needs

23. Phase 1(1998 to 2003) Phase 2(2002 to 2007) Phase 3(2007 to 2012) Crisis Management Strategic Management Realtime Integrated System • Restore trust • Restore safety • Rebuild core operations • Stabilize facilities • Manage crises • Tactical management • Become model for health care delivery • From blood manufacturers to “stewards” of the blood system • Embed strategy across organization • Real-time demand forecasting • Seamlessly integrated from hospital to donor • Widely deploy collection technology • Advance customer-service culture Since 1998, Canadian Blood Services has been transforming, strategically and continuously

24. Strategic change Transition Canadian Red Cross Society to Canadian Blood Services April – Sept. 1998 Stabilize Gain understanding of major issues Determine requirements for change Approximately 18 months Transform Re-engineer the system Regain trust and confidence in the blood supply 3 – 5 years

25. Phase 1 to Phase 2 Transformation • Canadian Blood Services is a business in a state of profound change • Successful transition from the previous operator and stabilization of major risks • Comprehensive re-engineering of entire operation • Transformation of: • service delivery model • support services • business strategy • corporate culture

26. Changing the service delivery model Disconnected “Centres” eroded by cost, time and circumstances into islands of duplication

27. 14 disconnected “silos” across Canada No coherent strategic approach to the business No big picture of problems and solutions Obsolete IT infrastructure Error-prone manual systems No consistent operational look and feel Major management skill-deficits Process and structural duplication Lack of operating metrics Many inconsistencies Traits of the silo model

28. Changing the service delivery model Integrated national model Silo model Context: quality and and risk management

29. Today’s effective, efficient and interconnected national service-delivery model

30. Features of the new service-delivery model • Fully integrated national network of: • collections, testing, production, labeling, distribution • Comprehensive metrics, process improvement • Single national inventory • improved supply-demand alignment • Upgraded planning, budgeting and financial controls • Comprehensive use of information technology to improve safety and accountability • e.g. MAK Progesa, advanced modular testing • Fully integrated donor management to improve supply • national marketing and communications, national/local branding, advertising, media relations, proactive National Contact Centre, intensified donor development with a strong community focus • Improved hospital relations

31. Getting the right things done • To ensure successful execution of the ambitious change agenda, Canadian Blood Services has adopted the Balance Scorecard • Rigorous methodology that promotes efficient and effective strategy development, strategy communication, corporate alignment, priority setting and strategy execution • Balanced Scorecards developed at all levels of governance: • Board of Directors, CEO, Corporate level, Senior Executives and all Divisions • designed to increase likelihood of successful execution of the strategy

33. We have accomplished a lot …

34. Results amid change: the new model in action • CBS year-over-year increases in core funding have declined below the general Health Care rate yet we have delivered increased value to Canadians • CBS has increased operational effectiveness. Collections have grown more than 20% since 2000 • CBS has delivered major operational efficiencies. Collections per employee have grown more than 14% since 2000

35. Trending upward Safe to Receive blood Safe to Donate blood Public trust in the blood system restored by emphasizing risk management, product quality and safety, operational transparency and accountability, and customer service

36. Risk management: the foundation of quality • Premise of Transformation is to create a high quality organization, delivering safe products and services in the most efficient manner possible • This is about much more than quality assurance, quality control, quality compliance or quality policies • Quality is to be a core competency of Canadian Blood Services and central to the culture of the organization • compliance is simply the cost of entry into the business • quality simply makes good business sense • Objective is to become the “Toyota of blood manufacturers” worldwide 39

37. From To • Activity focused • Regulatory compliance • Passive senior management • An obstacle and burdensome to day-to-day activities • Process oriented • Good business practice • Active process ownership • Management tool that enables change & improvement Evolution to quality system maturity • Manage resistance to change • Priority given to quality system implementation versus other strategic initiatives • Ability to demonstrate benefits • Cultural shift: 46

38. Risk Management • Seeks to assess and control the hazards that make up a risk domain • Relies on scientific risk assessment to estimate the probable harm to persons and environments resulting from specific types of substances and processes • Key activities: • Hazard characterization • Exposure assessment • Benefits assessment • Uncertainty analysis • Options / decision analysis

39. Risk Issue Management • A response to a specific public controversy about the adequacy of risk management measures and approaches • Typically becomes the subject of a protracted battle among stakeholder interest groups • Competing visions as to where the optimal resolution lies • Key activities: • Risk communication • Stakeholder relations

40. Risk management framework

41. Risks in blood and plasma systems • Freedom from transmissible harmful agents (THAs) • Adequacy of supply • Control of the system

42. Safety measures intended to interdict HIV • Belts and suspenders approach to safety • Successive measures aimed at risk reduction are increasingly complex, expensive • Incremental risk reduction is increasingly small

43. Safety measures introduced to Canadian blood supply since 1998 • Viral testing using: • state of the art, automated testing platforms (PRISM®) • nucleic acid testing program (NAT) for HIV, HCV • West Nile virus testing • Universal prestorage leukoreduction • Deferral criteria for vCJD • Bacterial detection assays • State of the art information system to manage entire supply chain, from donor recruitment through to product shipment (MAK Progesa®) • ensures complete product traceability • minimizes risk for error due to operator variability

44. Successful outcomes favour the prepared • Multiple aspects: • business continuity planning: • labour disruption • adverse weather conditions • loss of systems • disaster recovery planning: • manmade (e.g. 9/11, Aug 2003 blackout) • natural • emergency preparedness: • bioterrorism • emerging transmissible harmful agents (e.g. WNV) • public health threats (e.g. SARS, Pandemic influenza) 48

45. Transforming Canadian Blood Services, a continuing process Phase 1(1998 to 2003) Phase 2(2002 to 2007) Phase 3(2006 to 2012) Crisis Management Strategic Management Realtime Integrated System • Become model for health care delivery • From blood manufacturers to “stewards” of the blood system • Embed strategy acrossorganization • Real-time demand forecasting • Seamlessly integrated from hospital to donor • Widely deploy collection tech • Full customer-service culture • Restore trust • Restore safety • Rebuild core operations • Stabilize facilities • Manage crises • Tactical management

46. Impact of Aging Population • Donor base faces rapid decline • Product demand is escalating • Both trends are intensifying and long-term Looming challenge: the boomer bubble

47. Demand Supply • Aging population • Increasing morbidity • Increasing medical procedures • Changing product mix • Population growth • Ethnicity • Expanding role of the blood business • Global competition for plasma and fractionated products • Aging population • Health-cost containment • Creating new donors • New pathogens • Increasing deferrals • Regulatory issues • System capacity, flexibility, scalability • Technology deficit • Skills deficit • Supply management • Blood’s competitive brand and profile Collision course: demand-supply issues

48. The way forward: “A Blueprint for Excellence” • New enhanced relationships with hospitals • Real-time demand forecasting • Optimized collection, production and distribution model • Hub-and-spoke production and distribution • More new technology for collections • Collect only what hospitals need • Achieve donor service excellence • Elevate public mindshare on the crucial importance of blood donations

49. Summary • Canadian Blood Services has come a very long way since its crisis driven inception: • safety and integrity of products • adequacy of supply • control of the system • Well on the road to implementing a business strategy aimed at entrenching and sustaining a culture of safety, operational excellence and planning for tomorrow • Robust systems in place for mitigating risks, emergency preparedness and contingency planning • Continue to build on this foundation in growing the value of the blood system and earning the trust of Canadians

50. From public outrage to public trust Overcoming a Risk Disaster: Lessons Learned at Canadian Blood Services Ian Mumford Chief Operating Officer Canadian Blood Services To the Regulatory Craft Conference Halifax, September 30, 2008