Jordan unable to explain unauthorised GPHC $605M drug purchase

Asked to explain how the Georgetown Public Hospital Corporation (GPHC) was able to purchase over $605 million in emergency pharmaceutical supplies through sole sourcing if its request for a waiver of the Procurement Act was denied, Finance Minister Winston Jordan last Friday told the National Assembly that he could not explain.

He indicated that GPHC is an autonomous body, which receives a subvention from government via the Consolidated Fund and he could not account for its expenditure.

Jordan was at the time responding to questions laid in the House by PPP/C member Juan Edghill.

In July, Edghill had asked Jordan to explain how GPHC was able to purchase $605,962,200 of “emergency pharmaceutical supplies” through sole sourcing if its request for a waiver was denied.

Jordan, in a response on July 7, 2017, had advised the House in writing that the request by GPHC for a waiver was not approved by the National Procurement and Tender Administration Board (NPTAB).

Asked to state if any requests were made by the GPHC and the Ministry of Public Health for the waiver of procedures for the procurement of pharmaceuticals and medical supplies for the period January, 2016 to April, 2017 and to provide same to the National Assembly, including the grounds for each request, Jordan had explained that while there were requests from both GPHC and the Ministry of Public Health to the NPTAB for waivers for their respective procurement of pharmaceuticals and medical supplies, NPTAB procedures were not waived.

Jordan then listed eighteen times between January 1, 2016 and April 30, 2017, where requests were made by the GPHC for the waiver of the Tender Board procedure for procurement.

The NPTAB did not approve four contracts, totaling $631,913,655, for the supply of emergency drugs, which GPHC said was single-sourced under the Procurement Act. The awardees were Health 2000 ($2,923,900); New GPC Inc. ($20,888,610); Chirosyn Discovery ($2,138,925); and ANSA McAL ($605,962,200).

In light of this response, Edghill later asked how GPHC “was able to proceed to award the tender to ANSA McAL and to proceed to make payments in violation of the Procurement Act and the financial rules. “

He also called on the minister to say what action if any has been taken by himself, or the NPTAB, with regard to this matter as well as whether this violation has been referred to the attention of the Public Procurement Commission (PPC).

In responding to these questions on Friday, Jordan said “he could not say on what authority GPHC was able to make payments.”

Edghill was absent from the House and opposition Chief Whip Gail Teixeira was asking the questions on his behalf.

As a supplementary, Teixeira demanded of Jordan to be informed whether such a large outlay of funds was made without any alerts being triggered in the financial management system of the state apparatus.

Government, in September of this year, approved a $515,178,268 payment to supplier ANSA McAL for pharmaceutical drugs already delivered by the company.

This award has been the subject of three investigations, two of which have since been concluded. The third by the Auditor General is ongoing.

One of these investigations, conducted by the PPC, began after the controversial purchases were drawn to the public’s notice by Stabroek News in March of this year. Stabroek News had initially reported that the GPHC had sought approval for an “emergency” purchase of $605.9 million in items from ANSA McAL. It turned out that the purchase was not in compliance with the procurement law and that a number of items sought from ANSA could not be deemed emergency supplies. It was later revealed that three other “emergency” purchases were made by the GPHC, in breach of the procurement laws, from New GPC, Health2000 and Chirosyn Discovery.

The report cleared Minister of Public Health Volda Lawrence of any wrongdoing. It, however, noted that while GPHC officials’ intention to sole source the emergency drugs was conveyed to the NPTAB, they did not follow through with the established procedure for sole sourcing supplies and in so doing breached the Act by making awards to the suppliers prior to receiving NPTAB’s approval and Cabinet’s no objection.

A separate report by the GPHC had also absolved Lawrence and assigned blamed to former CEO Allan Johnson, who had been dismissed in the wake of the controversy over the purchases. In some quarters it was suggested that he was being made the scapegoat for the purchases.

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