IDB-blacklisted Trini company awarded $30M Health Ministry contract

Aug 22, 2017 News

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– Opposition calls for investigation

The Opposition is calling for an immediate investigation to determine whether proper procurement procedures were followed, with the award of more than $375M in drugs and other supplies for the country’s public health system.

One of the companies which was named last week to receive a contract of over $30M, made the news earlier this year, after it was learnt that it was blacklisted by the Inter-American Development Bank (IDB) for alleged corruption.
Yesterday, the People’s Progressive Party Civic (PPP/C), in a strong statement, expressed grave concerns over what it said is the continued flagrant violations and breaches of the procurement laws by the APNU/AFC administration.
The Opposition singled out the awards of contracts, especially in the public health sector.
The party, which lost its grip on power in May 2015 after two decades in office, pointed to last Friday’s announcements by Minister of State, Joseph Harmon, who disclosed that Cabinet has “noted” the tenders of a number of companies for state contracts.
With regards to the Ministry of Public Health contracts, over $370M worth was noted by the Cabinet. The suppliers approved are: Trans Continental Medical Products Limited (TCMPL) – US$675,615; Western Scientific Company Limited – US$154,154, Caribbean Medical Supplies Inc – G$27.3M, Eureka Medical Laboratories Incorporated – G$92.1M and Diamed Caribbean Incorporated – US$94,659.
Also likely to sign a contract is the Pan American Health Organisation (PAHO) which had tendered for over $50M.

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PPP noted that as is required by law, contracts of these magnitude should be properly advertised, with companies required to tender, an evaluation done, and an award made to the bidder who satisfies all criteria.
“Unfortunately, there is no evidence to suggest that this process has been followed, which raises concerns about the possibility of collusion, price fixing and other corrupt practices. One of the companies involved has had a track record of collusion and was blacklisted by the Government, yet this blacklisted company is now being awarded a hefty contract.”
In another instance, PPP claimed, one of the local companies that received a huge contract reportedly has a family member in a senior position at the Ministry of Public Health. This “raises the question of conflict of interest, insider trading and other corrupt practices,” the Opposition said.
“In the light of repeated scandals regarding the procurement of drugs and medical supplies; where a Minister was sent to the Committee of Privileges of the National Assembly for covering up nefarious practices; the recent scandals involving another Minister, where over $600M of drugs and medical supplies were sole sourced by GPHC and many other repeated violations, one is left to wonder whether there is any intention by the (David) Granger-led administration to comply with our procurement laws.”

PPP said that in the face of these repeated breaches, it is calling on the international community, especially the donors whose resources are sometimes used to fund these contracts to be more vigilant.
“This is another case for immediate investigation and public disclosure by the Public Procurement Commission (PPC).”

AUTHORISED DISTRIBUTORS
On Friday, Minister Harmon, during the reading of the contracts, stressed that the companies that have been awarded contracts to supply reagents and test kits to the Ministry of Public Health, are all the authorized distributors of the items being procured in Guyana, and they all have been supplying these items for a number of years.
“With regards to the supply of vaccines and syringes by PAHO…PAHO has also been the sole supplier of in Guyana for a number of years, under an arrangement through which it supports the local vaccination programme by way of a revolving fund that ensures continuous supply and an option to pay after delivery.”
The company that was blacklisted by the IDB, is Trinidadian-owned Western Scientific Company Limited – which has been recommended a contract award of US$154,154.
Western Scientific, which did business with Guyana in the past, including supplying items to the Forensic Laboratory on the East Coast of Demerara, was handed a four-year ban by the IDB from March 31, 2016 to October 15, 2020.
One related company and two individuals – SCIMED, Mario Ricard Dell and Edwin Mackoon – were also sanctioned for fraudulent practices and cannot bid for another four years.
According to the IDB website, the firms and individuals sanctioned by its Group’s Sanctions Committee were found to have engaged in fraud, corruption, collusion, coercion, or obstruction in violation of the IDB Group’s anti-corruption policies.
These findings were made through an administrative process that permitted the accused firms and/or individuals to respond to the allegations pursuant to the Sanctions Procedures.
Debarred firms are declared ineligible to be awarded and participate in any IDB-financed contract for the periods indicated. Ineligibility may extend to any firm or individual who directly or indirectly controls the debarred firm or any firm which the debarred firm directly or indirectly controls. In the case of a debarred individual, ineligibility may extend to any firm which the debarred individual directly or indirectly controls,” IDB said.
Western Scientific’s troubles were linked to contracts of the Citizen’s Security Programme. A contractor had blown the whistle to IDB of the scheme.
Part of the Citizen Security Programme involved the rehabilitation of community centres.
Drug contracts for the country’s hospitals and its related services amount to billions of dollars annually.
The PPP administration, too, in the past had come under scrutiny from state auditors for sole sourcing drug supplies, with the Coalition Government under pressure to clean up the procurement systems. However, shortly after coming to power in 2015, the APNU +AFC administration was forced to fire a Permanent Secretary at the Ministry of Public Health, because of significant lapses, including questionable payments for supplies.

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