Tussle in multi-million dollar health tenders

By Hilary Mare

CURRENT ‘darling’ of the health procurement system, Supra Health Care (Pty) Ltd) – a South African pharmaceuticals firm – has caused a stir in the pharmaceuticals sector after being awarded tenders of at least N$100 million in the last eight months.

While fears are growing that the awarding of lucrative health tenders to foreign firms may cripple the local pharmaceutical sector already grappling with dormant infrastructure and job losses, Confidente has learnt that Supra Health has now been challenged by SJV Medical Supplies in its latest bid.

Supra Heath was recently awarded the greatest chunk of a tender to supply and deliver clinical products to the Ministry of Health and Social Services getting the nod to supply products worth N$34.3 million of the allocated N$90 million.

This award comes after the same company was awarded a N$70 million tender in December.

Closest to Supra Health in the award was Galen Supplies with N$13 million, Novo Medical Supplies awarded N$9 million, Mozart Medical with N$5million, Encono Investments with N$4 million and Floulhuda also with N$4 million.

Confidente understands that Namibian companies highly invested in infrastructure that were disqualified include GekaPharma, Nampharm, Shipanga Medical services, Medlab, Fabu Pharm and many others in a list of 38 disqualified firms.

“If you look at the issues that disqualified our Namibian companies it was small issues such as the fact that the founding statement was not certified, documents attached but not in line and no indication of business principles. How do we grow our industry when such trivial issues are used to disadvantage companies that have invested greatly in infrastructure and employ many Namibians?

“The evaluation document also clearly shows that the turnaround of most of our local firms is just three to eight weeks while Supra Health has a standard turnaround time of eight weeks which is more than what local firms offer,” an industry expert who refused to be named told Confidente before adding that by awarding South African firms lucrative tenders, the State is prejudicing itself revenue in taxes.

SJV Challenge

Following the award SJV Medical lodged an application to review and set aside the N$34.3 million tender awarded to Supra Health.

In its challenge, SJV Medical alleges that the health ministry considered Supra’s bid, contrary to the prescribed tender guidelines in that Supra Health failed to deliver its bid at the ministry at the prescribed time and place of delivery of bids.

Furthermore, SJV Medical alleges that the ministry favourably considered Supra Health’s bid for award of the tender despite the same bid not having been available, neither opened nor read during the bid opening session on February 14 2020.

In terms of the health ministry’s bid invitation, all bidders, on or before 11h00, January 31 2020 (extended to February 14 2020) were to deliver their bid to the health ministry, Harvey Street, Finance and HR Building, Windhoek. However, Supra Health’s bid is alleged to have not been delivered before February 14 at 11h00 (instead Supra Latex an entity other than Supra Health’s bid was purportedly delivered on February 10).

Supra Health’s bid was also not delivered at the address specified in the bid but was delivered at Central Medical Stores.

“When so acting, the ministry (and its officials), to SJV’s and other Namibian entities prejudice, acted unfairly, unreasonably and irregularly, in contravention of Article 18 of the Namibian Constitution,” SJV’s lawyers, Murorua Kurtz Kasper Incorporated said in their review submission.

SJV Medicals owner, Victor Amoni affirms this in his own affidavit for review saying: “No reasonable decision maker, acting fairly, would on the basis of the aforementioned facts have made such as decision.”

Supra Health responds

In their responding affidavit, Supra Health Chief Operation Officer, Marc Seelenbinder highlighted that the application for review was void, illegal and against the law on account of its failure to comply with the provisions of the Public Procurement Act (Act No. 15 of 2015), the regulations made thereunder and the Namibian Constitution.

Firstly, Seelenbinder responding on behalf of Supra Health maintained that the application by SJV Medical was defective because it was not in compliance with regulation 57 as it was not served to them in accordance with the Act.

Secondly in view of the allegation that they failed to deliver their bid on time and at the right place, Seelenbinder said: “Firstly, we would like to point out that we couriered the bidding documents and same was subsequently received by the Ministry of Health and Social on 10 February 2020.

“Secondly, as is correctly reflected on the receiving stamp from the Ministry of Health and Social services affixed on the waybill, the bidding documents were delivered to the correct address as specified in the bid.”

He went to say that, “as a consequence of the above stated, we submit that the allegations contained in this review application are vexatious, frivolous and baseless. Accordingly it should be dismissed as it is procedurally and substantively defective.”

Health ministry defends Supra Health

In responses to questions posed to him by SJV Medical relating to irregularity of the award, health ministry executive director, Ben Nangombe defended Supra Health saying the pharmaceutical company had submitted its bid on time on February 10.

Interestingly, Nangombe, in part of the response went on to say: “Kindly, take note that during the opening of bids on February 14 2020 at the Procurement Management Unit, a representative of Supra Health raised a concern that their bid was not read out. As soon as the staff members of the Procurement Management Unit became aware of this concern, they went to the storeroom where samples were kept and retrieved the bid document which was opened in the presence of the company’s representatives the same day.”

In a comment this week, Nangombe added: “This application is nothing but mischievous. It was open to international bidding because when we experienced a shortage we approached the finance ministry for an exemption which allowed us to source locally and internationally. That international companies don’t pay tax here or have Social Security is not relevant because they don’t need that. We complied with all procurement laws.”