NEW GPC and others must deliver over $600M owed for drugs or else

NEW GPC and others must deliver over $600M owed for drugs or else

SEPTEMBER 30, 2015 | BY | By Kiana Wilburg

“They will be asked to pay up and we will be looking at the legal means of doing so,” says Public Health Minister

Public Health Minister, Dr. George Norton

Dr. George Norton

As Minister of Public Health, Dr. George Norton, continues to pursue the reform of his sector; he emphasized recently that a main concern remains with those companies that are still to deliver millions  of dollars’ worth of drugs to the Georgetown Public Hospital.

Dr. Norton said that several companies have been in default for many years. He said that this is not only “negligence and deceit, but a clear sign of blatant disrespect for the procurement laws of the country.”

This, he said, would not be tolerated under his watch. Those companies which are still to honour drug contracts they were awarded over the years will be asked to deliver the outstanding pharmaceuticals or “pay up” through the courts.

He said that he will be looking at the legal means to do so. He has already alerted the Chambers of Attorney General, Basil Williams on the need to take this matter before the court and to send a strong message to “appalling” defaulters like New GPC.

The New GPC is owned by Dr. Ranjisinghi ‘Bobby’ Ramroop, the best friend of Opposition leader and former President Bharrat Jagdeo.
Dr. Norton said that an examination of this sorry state of affairs can be traced all the way back to 2008 in the reports of the Auditor General (AG).
He sought to emphasize that NEW GPC received the bulk of the health contracts under the previous administration but failed like other companies to deliver outstanding drugs and pharmaceuticals.

In the AG’s most recent report, it noted that $958M was paid to the New GPC Inc. An examination of the records revealed that the payments related to one major contract and 131 purchase orders.
The major contract had an aggregate value of $871M of which the hospital paid $716M during 2013. At the time of reporting, the contractor was still to supply goods valued at $1.1M.

In relation to suppliers other than New GPC Inc., it said that they were still to deliver goods valued at $3.2M.
The report also noted that six suppliers received full contract sums totaling $163M in 2012. However, they failed to deliver drugs and medical supplies totaling $114M. These are still outstanding for the year 2012.

These companies include Productos Roche, Caribbean Medical Supplies, Trans Continental Ltd and Henry Schien Inc. In a related matter, the New GPC Inc. was still to supply a total of $12M worth of deliveries in respect of the year 2011.

The Budget agency of the then Ministry of Health had acknowledged the finding that the deliveries are still outstanding and it was subsequently recommended that the Ministry take immediate steps to have the contractor fulfill the obligations under the contracts for the years 2011 and 2012.

Further the AG’s report stated that in 2013, the Ministry expended amounts totaling $2.7 billion for pharmaceutical and medical supplies. The procurement of pharmaceutical and medical supplies by the Ministry of Health was based on awards by the National Board of Procurement and Tender Administration to the New GPC Inc. and other local and international agencies involved in the supply of drugs and medical supplies. In relation to the 2013 purchases, the transactions with New GPC included ten contracts valued at $2.4 billion of which freight charges totaling $180.496M were included in three contract sums.

The contracts were supported by six bank guarantees with an aggregate value of $2.554 billion. The guarantees were required to be valid for one year, but each had a validity of only three months and a set expiry pattern in months ending October 2013, January 2014, February 2014 and March 2014.

There were no guarantees in force at the time of the examination in July 2014, but the contractor was still to deliver goods valued at $323.321M. The Head of Budget Agency acknowledged the finding and indicated that efforts are ongoing to ensure that all outstanding drugs and medical supplies are delivered.

In relation to suppliers other than the New GPC Inc., payments totaling $435.344M were made to 21 local and overseas suppliers. However, only one contract for goods valued at $71.009M was supported by a bank guarantee.
At the time of reporting, nine suppliers did not fully satisfy their obligations with the result that goods valued at $192.057M remained outstanding.

Dr. Norton said that he refuses to let “this unacceptable trend continue” and vowed to ensure that all defaulting companies are held accountable for their actions.

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