Region Six paid 16 times more for medication

Jan 11, 2020 News

– tells auditors it is “economies of scales”

The Region Six administration in 2018 appeared not to be bothered by the price it was paying for drugs.

The Audit Office list of the prices paid at the MMU level and at the level of Region Six.

According to the recently leaked Auditor General’s report for 2018 on Government’s expenditure, examinations of the spending have raised worrying questions how that East Berbice administration was handling taxpayers’ dollars.
The region had a response: they paid more because they did not buy in large quantities.
Under the system of drugs distribution to health centres and state-run hospitals, the Materials Management Unit (MMU) of the Ministry of Public Health is the entity that handles purchases.
The regions would request from MMU what they required. The regions would have budgets if there are shortages.
It appeared that in the examination of the 2018 expenditure, the Audit Office was not too convinced that the region checked with MMU before it made purchases at what seemed to be some exorbitant prices.
The leaked audit report said that a “comparison of the prices paid for drugs and medical supplies procured by the Regional Administration from local suppliers with that of the prices paid by MMU as indicated on the price listing submitted, revealed that for 52 items, the Regional Administration paid significantly higher prices when compared with MMU’s prices.”
In fact, the region paid 300% more than MMU’s prices for 11 of the 52 drugs and medical supplies purchased.
“In two instances, the region paid as much as 1669% and 1465% more than the MMU’s price.”
In its response, Region Six officials indicated that the price paid by the regional administration for the purchase of drugs and medical supplies will differ from MMU due to “economies of scales”.
In its recommendation, the Audit Office urged that the regional administration ensured items
needed are not available at the MMU for supply before such items are purchased by the region and that these purchases are in keeping with the Procurement Act.
According to the list of drugs red-flagged as being purchased, one of the items was Risperidone, used to treat mood disorders.
MMU paid $13 each while the region shockingly paid $230…1,600 percent more. The region bought 8,400.
State auditors said that the taxpayers lost $1.8M.
The region, in 2018, also bought Surgical Gloves 7.5- MMU paid $929 for a box of 25 pairs. The regional administration paid an astronomical $5,200. Had the region taken from the MMU, the savings would have been $342,000.
There were others instances. For example, there were purchases of Amikacin. Amikacin is an antibiotic used for a number of bacterial infections. This includes joint infections, intra-abdominal infections, meningitis, pneumonia, sepsis, and urinary tract infections.
MMU paid $186 for a vial. The region paid $2,910.
This added up to 1,465 percent more being paid by the MMU.
For the many who know Hydrocortisone Cream, MMU paid $76 per tube while the region doled out $420 each. The loss was $103,000.
In recent years, there has been increasing evidence of wrongdoings when it came to the purchase of drugs, both at the ministry and at the regional levels.

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