GPHC found in breach of Procurement Act

Emergency drugs report

An investigation into the purchase of $632 million worth of drugs by the Georgetown Public Hospital Corporation (GPHC) has found that the institution was in breach of the Procurement Act on several counts, something the Parliamentary Opposition had suspected before the conclusion of the probe.
The Public Procurement Commission (PPC) Report on the investigation into the procurement of emergency drugs by GPHC found that the hospital breached Sections 17(1) and 25(2) of the Procurement Act. Breaches were also made in Section 26 (1) of the Act, which speaks to tender procedures.
The probe found that the decision taken by former Chief Executive Officer (CEO) of GPHC, Allan Johnson, to write suppliers informing them of awards made for them to supply pharmaceuticals to the value of $631 million without obtaining the requisite review of the National Procurement and Tender Administration Board (NPTAB) and no objection by Cabinet was in breach of the law.
The report, seen by this newspaper, also states that the CEO was aware that he had breached the Act, because he subsequently sought to obtain retroactive approval for his actions even as the GPHC started receiving the supplies of drugs that were ordered as a form of emergency.
“The decision to annul the emergency tender scheduled to be opened on February 14 demonstrated that the GPHC team did not fully examine all options available to achieve the objective of “fast tracking” the emergency drugs. It also found that the plan approved by the CEO and Public Health Minister Volda Lawrence demonstrated a lack of knowledge of procurement and the regulations.
The 67-page report also noted that the request made by the minister to “fast track” the emergency drugs could have been addressed using a supplement to the emergency tender that was already launched on February 2, 2017.
In fact, the PPC said the GPHC could have identified the emergency drugs needed, and should have been able to extract from the list of drugs already identified for the tender.
While recognising that the assignment of a clinical pharmacist at GPHC assisted with this process, the probe found that the GPHC still went ahead and annul the emergency tender in its entirety, and sole-sourced the full number and quantity of drugs on the list compromising emergency tender. While the former CEO had written the Chairman of NPTAB informing him of the annulment of the emergency tender and his intention to sole-source the drugs, the PPC said, the hospital should not have annulled the emergency tender, which was for a six-month supply of drugs. Taking another appropriate route would have resulted in significantly reduced expenditure, the report stated.

The PPC also noted that two other suppliers — IPA and New GPC Inc — contended that they could have supplied the same pharmaceuticals at much lower prices, saving the GPHC in excess of $200 million.
The report also zoomed in on the extent of involvement of Minister Lawrence in the procurement of the emergency drugs by GPHC. It stated that while the Minister instructed the GPHC to “fast track” the process, it should not have been interpreted as ‘bypass’ the NPTAB.

Recommendations
While the report has made several recommendations, one of the most important ones listed was that the GPHC is an independent agency and it should therefore not be subjected to direction and control from persons who are external to the organisation, referring specifically to the Minister. The PPC reminded that the Minister is responsible for policy-related matters, and not administrative issues.
The PPC also noted that the GPHC should take appropriate steps to separate procurement from finance, and procurement staff should be appropriately qualified and regularly trained in current procurement procedures.
The pharmacy staff should also be responsible for forecasting the needs of the GPHC, and should provide the Procurement Department with accurate and timely information.
The report said, too, that NPTAB should ensure that the evaluation process for tenders is conducted in accordance with the Act. It noted that the GPHC is operating an agency tender board without the approval or input of NPTAB, and this should be addressed urgently to avoid further breaches.