Moves to tackle health kickback scam

Government officials in Papua New Guinea’s national health department have received massive kickbacks from pharmaceutical drug suppliers in a scandal that had been going on for nearly 10 years, but moves are afoot to tackle the problem, health officials say.



Payments by medical suppliers to government officials for favours had run into the equivalent of hundreds of thousands of dollars, said the head of the country’s National Health Department (NDOH), Clement Malau, as well as senior hospital officers.



“The Department of Health tendering process is not transparent. As a result, there is evidence that drugs have leaked, and favours have been given to individuals and companies... This has led to allegations of staff being paid for services rendered that were not in line with proper procurement processes,” Malau told IRIN.



The procurement of medical supplies comes under the auspices of the NDOH, which procures drugs based on a national tendering process.



“We admit that our tendering process needs a complete overhaul because we believe the process has not been fully transparent,” Malau said.



Senior medical doctors in the country told IRIN hospitals were deliberately starved of medical supplies and drugs to create an “emergency” system, allowing the NDOH to bypass official tendering.



Closure of government medical store



Doctors came out publicly following the closure of the main government medical warehouse in Madang town in the country’s northern Momase region, and the shortage of medical supplies, including drugs, at Kimbe Provincial Hospital in West New Britain Province in the Islands region early this year.



The Madang store supplies medical equipment and drugs to the provincial hospital as well as other health facilities in the province.



Local media reported early this year that all health centres and aid posts in the six districts of Madang Province had run out of drugs, forcing patients to go to pharmacies in town to buy their medicines, with three children dying as a result.



Frustrated patients reported travelling long distances to town to buy their medicines at very high prices.



In the case of Kimbe Hospital, the local daily newspaper Post-Courier reported the hospital has not had oxygen or halopaine (used for anaesthetics) since November 2010.



The hospital had also run out of drugs to treat tuberculosis, a major worry: TB treatment requires continued regular doses without interruption.



Hospital patients were sent to other pharmacies to buy common drugs and supplies not available in the hospital pharmacy, including anti-malaria tablets and bandages, while basic drugs for operations were in dangerous low supply.



“The wholesalers can literally charge what they want, and as it is `an emergency’ the government often ends up paying more than twice the normal rate for the medicines.



“In addition some wholesalers in this city are notorious for allowing health officials and others who organize these lucrative `emergency orders’ to get a cut. Even only 10 percent of one million kinas (US$300,000) is 100,000 kinas ($30,000),” said a senior doctor who requested anonymity.



But change is forthcoming, said Malau.



“The minister for health has directed a ministerial taskforce to focus its attention to address the problem in the whole of tendering, procurement and distribution. If we get the required drugs to the location in a timely manner, we have control over the stock, and health workers will not buy drugs at highly inflated prices on the local market.”



Anti-corruption tsar



A drug procurement and distribution specialist, charged with establishing an efficient drug ordering and distribution system, was recently hired by the NDOH, and the results are starting to show, said Malau.



“Because the opportunity to get cuts and percentages has now been eradicated by the new procurement and distribution consultant, there are many disappointed people in the NDOH and central medical stores offices.



“Such is the level of severe disappointment of some in high places that they [officials] are trying to get rid of this expert before the end of his contract,” the senior doctor said.



But Malau reaffirmed his support for change. “I am giving the consultant 100 percent support on the work he is currently doing to improve the procurement and distribution process of medical supplies in the country.”



Borneo Pacific Pharmaceutical Limited, a major government supplier of medical supplies, has thus far not replied to requests for comment on bribery allegations.



pk/pt/cb