PPA investigates ‘botched’ snake anti-venom procurement

The Public Procurement Authority (PPA) is investigating the circumstances surrounding the unexpected cancellation of the entire procurement process for purchasing life-saving snake anti-venom by the Health Ministry.

The PPA, which is mandated to ensure value for money, efficiency and transparency in public procurement, according to B&FT sources requested all information pertaining to the tender in issue from the MoH, after various procurement breaches were brought to its attention by some of the companies participating in the tender process.

The Authority, the sources say, has now received the documents and is investigating issues of procurement breaches – double-bidding, price change after competitive bidding had closed, bid security manipulation, not meeting the additional qualification requirements – brought to its attention.

Policy think-thank Imani raised the issues in a letter dated February 26, 2019 addressed to the Health Minister, Kwaku Agyeman-Manu titled ‘Still on Ineffective Anti-snake Serum & Procurement Breaches-Evidence Finally’. 

Imani in the letter argued that a major financial breach, in allowing Pharmanova to change its price after competitive tendering had closed, was just designed to skew the whole process in favour of one participant.

Clause 27 and 30(1) of the Tender-document, as well as Section 57 of the Public Procurement Act (Act 663 amended), gives the Ministry the right to correct arithmetic errors detected during the evaluation process. In clause 27 it says, “During the evaluation of the tenders, the Purchaser may at its discretion ask the Tenderer for a clarification of its tender”. It further continues as “… no change in the price or substance of the tender shall be sought, offered or permitted, except to correct arithmetic errors identified by the Purchaser in the evaluation of the tenders”.

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Clause 30.1 clearly explains what an arithmetic error is and how it should be corrected:

“Arithmetic errors will be rectified as follows: If there is a discrepancy between the unit price and the total price that is obtained by multiplying the unit price and quantity, the unit or sub-total price shall prevail. If there is a discrepancy between the sub-totals and the total price, the total price shall be corrected. If there is a discrepancy between words and figures, the amount in words will prevail”.

“Therefore, it is very clear how to deal with arithmetic errors when they occur. Based on the evidence, it would seem that the Ministry of Health instead asked the two Pharmanova companies to change their unit costs and total costs after the public opening of the tender,” Imani argued in its letter to the sector minister.

Another major breach identified by Imani is the issue of double-bidding. “Two companies that submitted bids,” Imani noted, “are actually one and the same company – meaning that there was double/alternative bidding involved in this tender, which is illegal.”

Background

Tenders for supply of the anti-venom serum were officially opened in August 2018, but the decision to award the contract for supply of same was delayed until December 2018 – as the Health Ministry schemed to award the contract to one particular participant whose product had been flagged by the World Health Organisation as lacking the required efficacy to treat snake-bite victims, according to B&FT sources.

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The Ministry of Health requested from the Central Tender Review Committee financial clearing for the Pharmanova Export Pvt Ltd. bid., which had a face value of US$3,100,000.

As the various procurement breaches – double-bidding, price change after competitive bidding had closed, bid security manipulation, not meeting the additional qualification requirements – in the tender process on the part of the Health Ministry were brought to the fore by other companies who submitted bids, the Central Tender Review Committee cancelled the financial clearance for procurement of the vital anti-venom serum.

Rather than ratify breaches in the procurement process as identified and select a vendor with a potent serum that is registered by the Food and Drugs Authority (FDA), the MoH took a decision to cancel the entire procurement process altogether – because its favourite company couldn’t win – leaving hard-working farmers and individuals at the mercy of snakes at a time when the hot weather between January and March is associated with significant snake-bites.

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