Drugs Purchase Scam


A transparent tendering system can help in curbing corruption

The Goa Pradesh Congress Committee president Girish Chodankar has alleged a scam in procurement of medicines for the Goa Medical College and Hospital to the tune of Rs 40 crore. According to him, medicines were being procured by the government›s central hospital from a private firm Wellness Forever which does not figure in the government-approved list of medicine suppliers. What was more, he alleged, medicines were being supplied by the private firm at three to four times prices than the average supply prices. The intriguing part of the affair is that Wellness Forever set up business in the state only a few years ago, but has been favoured in preference to all companies that had been supplying medicines to the GMCH at government-approved rates. The government must provide a convincing explanation to the public on the charge that while the government did not buy medicines worth Rs 21.75 crore through regular tender stating that it did not have funds, it procured medicines at MRP worth Rs 40 crore from the firm in question. The listed pharmaceutical firms were earlier supplying medicines at one-fourth the cost that was allegedly charged by the private firm.

 Health Minister, Vishwajit Rane needs to make it clear if it was true that though the licence granted to Wellness Forever was for supplying medicine at wholesale rates, the firm charged retail rates. The taxpayers, whose money the government spends, have a right to know if the whole set of procedures followed in allowing purchase of medicines from the said firm at retail rates and to the exclusion of competitive bidding was legitimate and regular. If fingers are being raised at the alleged collusion of the officials of the Food and Drugs Administration it is quite natural. The FDA is supposed to be the gatekeeper for legitimate supplies. The Health Minister›s claim that the medicine purchases were above board has been seriously disputed. A full scale independent inquiry needs to be ordered in order to judge if the procedures followed in the matter were legal or illegal. 

 The finalization of tender for procurement of medicines had been put off by the government for one reason or the other for a long time. This has helped the health authorities to manipulate the system to procure medicines from whoever they want. There have been allegations that the terms and conditions for supply of medicines were manipulated when Dr Pradip Naik was the dean of the GMCH. It has been alleged that it was done to favour Wellness Forever which led to disqualification of all the Goan medicine suppliers. A new tender was subsequently raised on August 6, 2018 and forwarded to the government for its approval after the technical and financial bid evaluation was done by the GMC drug purchase committee but somehow the approval was delayed. It is surprising to note that anticipating delay in government according its approval, the authorities obtained a written consent from the Goan suppliers on May 31, 2019 to continue with their supplies at old rates which were approved five years prior to that but they somehow failed to get the contract.

 On an average the GMCH procures medicines worth Rs 5 lakh per day through the local purchase system due to lack of medicines in central pharmacy. The requisition for supply of medicine is initiated by the head of the department concerned and approved by the authority in-charge of the central pharmacy, following which it is accorded final approval by the dean. These supplies are made at maximum retail prices which benefit the suppliers. Had the government set up a foolproof mechanism to ensure regular supply of medicines through a transparent tendering system, the state could have saved crores of rupees which were flowing into the coffers of private companies and benefiting certain individuals and bleeding the state exchequer. Now that serious irregularities and discrepancies have been pointed out it is absolutely necessary that the government takes steps to streamline the much delayed tendering process for supply of medicines not only in GMCH but other hospitals as well and leaves no scope whatsoever for manipulations by anyone. A perfect tendering system would help restore a fair competition among suppliers and plug the loopholes that could be used by vested interests.