SOLE SOURCING AND TENDERING

Aug 06, 2018 Editorial

The sole sourcing of drugs in Guyana is a very contentious issue with accusations of bribery and corruption. It was practiced frequently by the PPP government. The problem with soul-sourcing is that it is improper.
The government and the opposition have been critical of each other for by-passing the procurement process. While in opposition, the APNU+AFC coalition had criticised the PPP administration for the sole sourcing of drug contracts to the New Guyana Pharmaceutical Corporation, whose owner Dr. Bobby Ramroop is a friend of former President Bharrat Jagdeo. Now in office, this government is doing the same thing, which means that it is making the same mistakes as its predecessor.
The decision by the Ministry of Public Health to by-pass the procurement process and sole source $366 million in drug supplies to the New York-based HDM Labs Inc. has raised the ire of the opposition. It has also drawn criticisms from the media and the public.
Opposition leader Bharrat Jagdeo has labelled the decision by the Ministry as part of a plan to financially reward supporters of the government with lucrative contracts. In listing the payments made to government supporters, the opposition leader pointed to Larry Singh, who received G$ 265 million from the Ministry of Public Health for the rental of the controversial drug bond on Sussex Street, which Singh had purchased for $25M. In 2016, the government awarded a $400M fertilizer contract to the owner of HDM Labs Inc., Dr. Hardat Singh. During the 2015 elections, Singh had hosted several fundraising events at his residence in New York for the Coalition government.
Based on procurement rules, sole sourcing must meet the criteria that the drugs are emergency in nature and that only one company is capable to supply the drugs on time. HDM Labs Inc., did not meet the latter criteria.
It has no experience in supplying drugs and has never supplied any to the Ministry of Public Health. Yet it was awarded the contract over several other experienced suppliers including Ansa McAl Limited, International Pharmaceutical Agency, Global Healthcare Supplies Inc., Caribbean Medical Supplies and Meditron Inc. These companies bid far less than the bid submitted by HDM Labs. The highest bid of G$ 190.6 million was made by Ansa McAL, yet HDM Labs was awarded the contract.
As reported in this publication, HDM Labs was invited by the Permanent Secretary of the Ministry of Public Health to submit quotations and to be available to supply pharmaceuticals to the Ministry. In justifying why the Ministry chose HDM Labs, the Permanently Secretary claimed that the US-based company has the capacity of delivering the drugs within two weeks and that it was an efficient supplier of drugs in the past. However, the company did not meet the Standard Operation Procedure required for the supply of drugs because of a lack of experience.
While this incident has baffled many, it is not the first time the Ministry of Public Health has sole sourced drugs. In 2016, it had sole sourced a $605 million contract for drugs to the Trinidadian company, Ansa McAL. This incident prompted the President to say that disciplinary actions will be taken against anyone found to be at fault of sole scouring pharmaceuticals for the Ministry of Public Health. Even though the Minister claimed she had authorised the contract, which was a clear violation of the procurement laws, yet she was cleared of any wrongdoing by the Procurement Commission, which investigated the matter.
This time, the government is silent on the issue which suggests that disciplinary measures may not be taken against anyone. Other alleged corrupt practices at the Ministry of Public Health has led the Minister to warn officials at the Ministry that she would call the police and state auditors to investigate wrongdoing.
The sole-sourcing of drugs and other wrongdoings has led many to believe, including critics of the government and the opposition in particular that corruption is rampant at the Ministry of Public Health and other government departments.

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