B - Cost of Living B09. HEALTHCARE

B09-12. Ensure a more efficient, responsible and transparent drug supply chain process

The Star June 14, 2018
In progress
Jul 2018

Task force on drug monopoly claim to meet next week, says Dr Dzulkefly

The Star Online July 05, 2018

The task force looking into a drug and medical supplies monopoly claim will meet sometime next week for the first time, said Health Minister Dr Dzulkefly Ahmad (pic). He said that the Government has to iron out its own policies first as it involved some sensitive issues relating to policies. "It is going to be an inter-ministerial thing," he said after launching the Healthcare Forum 2018 - Sustaining Tomorrow's Healthcare, Empowering Today's Consumers on Thursday (July 5). On June 20, it was reported that the Government had agreed to set up a special task force headed by Economic Affairs Minister Datuk Seri Azmin Ali to look into the alleged drug monopoly claim. Dr Dzulkefly said the four ministries involved were Health, Transport, Agriculture and Agro-based Industry and Economic Affairs. He said that they had not called the concessionaires yet. On June 13, details of high-ranking officials, politicians and their relatives allegedly involved in bid rigging of the tender process, emerged. It was alleged that they rigged control control of billions of ringgit worth of drugs supplied to the Government, which could lead to high drug cost, have emerged. In a 12-page document emailed to Dr Dzulkefly and forwarded to a handful of parties including The Star, the document revealed the monopoly of the supply of drugs to the Health Ministry. According to the documents, from 2013 to 2016, of the total medicine tender awards by the Health Ministry which amounted to RM3.7bil, the top three tendering agents were awarded RM2.8bil or 75.9% of the RM3.7bil.

Jun 2018

Government to review procurement process for drugs

The Star Online June 25, 2018

The Government will be reviewing the procurement process of medicines, said Health Minister Dr Dzulkefly Ahmad. “We are committed to do a critical review to achieve supply chain optimisation. We want to make sure the procurement cost of drugs and other consumables will not be so high,” he told reporters on Monday (June 25) after a talk organised by Sinar Harian. Dr Dzulkefly said he will make sure issues related to third party concessions or any “monopoly issues” is handled properly and effectively. He said the Government may also buy medicines directly from manufacturers. Dr Dzulkefly added that the Health Ministry is looking into pooled procurement with other ministries, such as the Defense Ministry, which also needs medicines. “With economies of scale, we will have better bargaining power. This will help to bring down the cost,” the minister added. “We want a real open tender system, where there is no collusion and no bid rigging. But this is easier said than done. We will look into how to practice this,” said Dr. Dzulkefly. Dr Dzulkefly also said the ministry will leave it to the Malaysian Anti-Corruption Commission (MACC) to investigate the allegations regarding rigging of the open tender process for drug procurement. “Let the law take its course. The ministry will not interfere,” he said. Dr Dzulkefly declined to name the politicians allegedly involved in the case. “I do not want a trial-by-media,” he added. On June 13, a 12-page document was emailed to Dr Dzulkefly alleging that a monopoly controlling billions of ringgit worth of medicines supplied to the Government was linked to high-ranking officials and companies linked to certain politicians. It also claimed that the tenders went to six main agents, who were collectively awarded RM3.4bil or 90.93% of the total sum.

Jun 2018

<NEW PROMISE> Health Minister promises more transparency in drug supply chain

The Star Online June 14, 2018

Dr Dzulkefly Ahmad has promised that the Health Ministry will take steps to ensure a more efficient, responsible and transparent drug supply chain process. The Health Minister tweeted that Pakatan Harapan wanted to ensure that existing weaknesses are corrected and that all forms of wastage are addressed. "These include any wrongdoings if proven," he said in response to a report by The Star on Wednesday (June 13). A 12-page document being circulated claimed that the open tender process for drug procurement by the Government was rigged, enabling a monopoly of sorts. It claimed that the tenders went to six main agents, who were collectively awarded RM3.4bil or 90.93% of the total sum.

Jun 2018

Multi-billion ringgit expose of medicine monopoly involving politicians, senior officials

The Star Online June 13, 2018

Details of high-ranking officials and companies linked to politicians allegedly involved in controlling billions of ringgit worth of medical supply to the Government have emerged. In a 12-page document emailed to the Health Minister Dr Dzulkefly Ahmad and forwarded to a few parties including The Star, the document revealed the bid rigging of open tender process, thus enabling the monopoly of medical supply to the Health Ministry. From 2013 to 2016, the total medicine tender awards by the Health Ministry which amounted to RM3.7bil were controlled by six main tendering agents. It claimed that collectively, the top three tendering agents were awarded RM2.8bil or 75.9% of the RM3.7bil; top six were awarded RM3.4bil or 90.93% of the RM3.7bil of the total tender contracts value. The document said that there were many established distributors, resellers and bumiputra tendering agents in Malaysia but the contracts were only appointed to a handful. "More importantly, the top tendering agents are actually owned by high ranking officials and/or politicians, or relatives of high ranking officials and/or politicians. "International pharmaceutical companies collude with official-owned tendering agents to bid rig," it said. According to the document, these drugs supplied are the open tender for medicine not covered under the Approved Product Purchase List (Pharmaniaga concession) which international pharmaceutical companies could participate. The Ministry puts out a procurement tender and the companies will engage bumiputra tendering agents to bid for the tender according to the tender specifications and the agents are paid a percentage of commission based on every tender won, it said. It claimed that these tendering agents act as intermediaries and earn a clean profit since they do not handle marketing, logistics or distribution. "It is no coincidence that more than 70 pharmaceutical companies all only use the same few official-owned tendering agents," it said, accompanied by proofs of the allegations. By refusing to supply or deal with other resellers and tendering agents, international pharmaceutical companies grant official-owned tendering agents a monopoly and thus securing an automatic win in a tender, it said. "From at least 2011 to the present, international pharmaceutical companies have been paying bribes to high ranking officials/politicians to assist in obtaining or retaining business in Malaysia in violation of the United States Foreign Corrupt Practices Act (FCPA). "These corrupt payments are concealed as commission payments to the official-owned tendering agents," said the whistleblower. When contacted, Health Minister Dr Dzulkefly Ahmad said that he will look into it and peruse it properly. "If there are substantive things, we will pursue it," he said.