COVID-19: Nigeria’s health agency inflates prices of infrared thermometers by more than 200 percent
FOUR companies received contracts worth millions of naira to supply infrared thermometers to the National Primary Health Care Development Agency, NPHCDA, but the prices were inflated, and one of the companies was not legally registered in Nigeria.
AT the height of the coronavirus pandemic in April, major companies and agencies of government in the country were buying thermometers as a new line of defence against the coronavirus.
Temperature-taking is a simple screening mechanism against COVID-19, but doctors say it isn’t foolproof. Temperature checks don’t detect people who are infected, but asymptomatic persons, or those taking fever-reducing medication.
However, the Federal Government in response to the pandemic approved the release of N840.6 million to the NPHCDA to make purchases of medical supplies, services and equipment in a race to manage the public health crises across the country.
Records obtained from the Nigeria Open Contracting Portal, NOCOPO, an open-source, public procurement platform showed that the NPHCDA approved 26 different COVID-19 emergency projects that were handled by nine companies and each of the projects completed within two days.
The coronavirus related contracts ranged from the supply of masks and medical equipment to printing services, infrared thermometers and training services.
The ICIR investigations showed that the NPHCDA offered lucrative contracts without a fully competitive bidding process to four companies at the tune of N226,167,500 to supply 2,615 infrared thermometers.
The contracts were worth four times more when compared to retail prices on online retail shops like Jumia and Amazon. Also, some of the companies received multiple contracts worth millions of naira for the supply of the infrared thermometers in different quantities indicating contract splitting, which is a breach of the 2007 Public Procurement Act, PPA.
The core mandate of the NPHCDA in the face of the coronavirus pandemic was to ensure that the Sustainable Primary Health Care Service System, is delivered to the Nigerian populace especially in rural areas.
According to information available on the website of the World Health Organisation, WHO, the NPHCDA was expected to provide Nigerian health care workers with personal protective equipment and improve the dissemination of health information and measures to protect oneself from COVID-19.
NPHCDA buys each thermometer at an exorbitant price of N80,000
The four pharmaceutical firms awarded contracts to supply infrared thermometers to the NPHCDA include Azmu Pharmaceuticals Ltd, Afri Generic Ltd, Dreams Pharmacy and Stores and Pharmacons International Ltd.
Data obtained from NOCOPO website showed that Azmu Pharmaceuticals Ltd was awarded multiple contracts by the NPHCDA to supply 475 units of infrared thermometers at N39,900,000 and 605 units at N49,912,500 respectively.
Dreams Pharmacy and Stores also received dual contracts from the NPHCDA to supply 460 units of infrared thermometers at N38,410,000 and 330 units at N27,390,000 of which both projects were completed within two days each.
While Afri Generic Ltd received N46,900,000 to supply 460 units of infrared thermometers and Pharmacons International Ltd was also awarded N23,655,000 to supply 285 infrared thermometers.
The ICIR’s examination of the procurement details of the contracts issued to the pharmaceutical firms confirmed that Azmu Pharmaceuticals Ltd sold the thermometers to the NPHCDA at the cost of N84,000 and N82,500 each.
Dreams Pharmacy and Stores sold the infrared thermometers to the NPHCDA at N83,000 and N83,500 respectively. While Afri Generic Ltd and Pharmacons International Ltd sold the thermometers at N83,750 and N83,000 each.
One -Third of the Price of NPHCDA Thermometer
The ICIR reached out to Alpha Pharmacy, based in Lagos reputable for being the supplier of critical care products and medical devices in Nigeria for over 33 years to ascertain the prices of the infrared thermometers.
Speaking to a sales representative at the company who gave her first name as Chidimma, she said the price of the infrared thermometers was currently at N25,000 but added that buying in bulk will reduce the price.
“Currently, the price of an infrared thermometer is N25,000 but if you are buying in bulk then we will lower the price for you to N20,000,” she said.
She also explained that during the pandemic suppliers exploited the situation and raised the prices higher than it should normally cost stating it was around N50,000.
“Though during the peak of COVID-19 pandemic in the country the prices of infrared thermometers were way higher it depends on the negotiating power of the client but it did not rise beyond N50,000,” she told The ICIR.
This means that for the price quoted by Alpha Pharmacy, 605 infrared thermometers at N25,000 would cost N16,250,000 which is one -third of the amount quoted by Azmu Pharmaceuticals Ltd for the same quantity in its warehouse before the outbreak of COVID-19 in its the country.
At the price of N20,000 for the same quantity of infrared thermometers, it would cost N12,100,000 while at N50,000 each it would cost N30,250,000.
The ICIR also checked online retail stores on Jumia and Amazon, the prices of the various infrared thermometers on the websites range from N22,000 to N50,000 respectively. In fact, that sold at N50,000 are automatic ones.
An unregistered firm gets NPHCDA contract
However, The ICIR could not find a website or digital presence online of Pharmacons International Ltd which received N23,655,000 to supply 285 infrared thermometers to the NPHCDA.
Also, the name of the company could not be found on the records of the Corporate Affairs Commission, CAC, as a legitimately registered company.
Therefore, the NPHCDA disregarded the Public Procurement Act of 2007, that stipulates that for a company to be eligible to handle contracts for the Nigerian government prospective bidders are expected to provide evidence of registration on the database of Federal Contractors, Consultants and Service Providers by submitting Interim Registration Report or valid certificate issued by the BPP.
To be eligible for this, companies must be registered with CAC to participate in the bidding process.
NPHCDA defends contractors
When The ICIR contacted the NPHCDA via a letter to ascertain why the prices quoted by the contractors were high compared to the prices on the regular market and the multiple contracts allotted to the pharmaceutical firms to supply the same item.
Soji Taiwo, Acting Head of the NPHCDA’s Procurement Unit in his response to The ICIR’s enquiry said the bidders quoted their taxes and profits in their proposal which was why the prices of the thermometer were high.
“It is pertinent to clear that market price varies with time and location. It is not often that the bidders always quote the actual market prices when bidding for jobs because they incorporate taxes and profits in their proposals,” he said.
On the website of the BPP, the bureau highlighted guidelines for emergency procurement which was based on the Public Procurement Act, PPA of 2007 and signed by Mamman Ahmadu, the Director-General of the BPP.
“Procuring entities shall proceed to award the contract at prevailing market prices, specifying quantity/quality (in terms of specification requirements) and time within which the execution of the Goods, Works and Services must be completed,” the guideline read.
He also said Azmu Pharmaceuticals Ltd submitted different quotations, stating the firm had exhausted its stock of infrared thermometers at the time and hence, the need to submit another proposal to source from other markets.
“Azmu Pharmaceuticals Ltd gave two different quotations for the supply of infrared thermometers at different times for various reasons, 605 stocks of thermometers were in his warehouse before the pandemic and the other 475 thermometers were sourced from other markets during the COVID-19 pandemic peak period,” he said.
However, Soji’s statement contradicts the guidelines for emergency procurement stipulated by the Bureau of Public Procurement, BPP which states that government agencies should award contracts at prevailing market prices.
“Procuring entities shall proceed to award the contract at prevailing market prices, specifying quantity/quality (in terms of specification requirements) and time within which the execution of the Goods, Works and Services must be completed,” the guideline states.