The Tribune

Major Bahamian pharmaceutical wholesalers last night said they were yet to feel the benefits of the Public Hospitals Authority’s (PHA) 20 per cent ‘local’ spending increase, with two reporting a decline in government sales this year.

Responding to yesterday’s PHA’s statement in Tribune Business, the trio of Lowe’s Wholesale, Nassau Agencies and Commonwealth Drugs (CDM Group) said it was “unfair and callous’ to suggest Bahamian jobs were not being jeopardised by its changed procurement policies.

“In response to the comment that the PHA made regarding the fact that their [local] expenditure for drugs has increased by 20 per cent [over the past two years], at least one major wholesaler says that their sales to government are significantly down this year,” the statement said.

“Another major wholesaler says that their sales are also down over last year. It could be true that PHA has had a 20 per cent increase in expenditures, but to say wholesalers are being deceitful and suggesting that jobs have not been lost by the persons who have had to suffer this as a direct result is unfair and callous.”

The wholesale trio also questioned whether a significant portion of the PHA’s touted local spending increase had gone on non-contract pharmaceutical drug purchases, given that the ‘last but one’ tender, known as MPC 15, had lasted for two-and-a-half years.

But, rejecting claims that its policies could “wipe out” the Bahamian pharmaceutical wholesale industry and associated employment, the PHA said on Monday that such allegations were not supported by its expenditure record.

“In the period July 2014-June 2015, local pharmaceutical vendors received more than $15 million. For the period July 2015-June 2016, local vendors received more than $16 million, and it is projected that by the end of the fiscal year 2016-2017, the PHA would have spent in excess of $18 million with local vendors for the procurement of pharmaceuticals alone,” the PHA had told Tribune Business.

Wholesale concerns have been sparked by the PHA’s decision to switch to ‘direct purchasing’ from foreign manufacturers, including some they act as distributors for, in sourcing the 50 per cent of items not awarded in the latest tender, MPC 16.

The PHA justified this move by saying that if Bahamian wholesalers could not supply its needs, it had no choice but to look abroad - and explore all avenues - if it was to meet patient demands.

“It would be foolhardy to suggest that when drugs and medical supplies cannot be sourced in country that the PHA turns a blind eye to sourcing them elsewhere, leaving those entrusted to our care without the medications they may require for treatment,” the PHA added.

However, the three wholesalers last night queried why just 50 per cent of the PHA’s MPC 16 tender had been awarded - “the first time” this had happened in almost 30 years of drug procurement by the public body.

They also asked why Bahamian distributors were not “at least informed” of the 760 drug products the PHA was still seeking when it sent out the October 31, 2016, e-mail seeking direct bids from manufacturers.

“Is it true that none of the 760 items sent directly to the manufacturers were bid for?” the three companies asked.

“Or was it that the bids were simply not accepted? Why? At least one wholesaler has reported that it had indeed submitted items on the list sent to manufacturers.

“If local wholesalers did not bid for the 760 items, why would PHA have gone to the same manufacturers whom they represent and requested bids? Is there a concern that wholesalers did not intentionally bid for products on MPC 16? If so, what happened for previous tenders?”

In their joint statement, Lowe’s Wholesale, Nassau Agencies and Commonwealth Drugs also queried why the manufacturers were given just two days to bid on a complex tender that required shipping and insurance quotes, plus delivery times.

“Is it true that a few manufacturers were told that they could not supply through their local wholesaler?,”the trio further asked.

“And why were they all informed by e-mail that the intent was direct procurement, and that no directive was given by PHA to include the local suppliers in the bids sent directly to manufacturers?”

The wholesaler statement also queried whether any manufacturer initially disqualified from the MPC 16 tender is being allowed to bid on the 760 items put out for direct procurement.

And they also asked who owns the building that houses the PHA’s new drug warehouse storage facility, and to whom the latter will now pay rent.

This facility’s creation has heightened fears that the direct procurement strategy being employed by the PHA to complete MPC 16 may foreshadow a longer-term switch to this method, and the exclusion of Bahamian wholesalers from the process. This, in turn, has been further exacerbated by the impending National Health Insurance (NHI) scheme and the uncertainty over how drugs will be procured for that.

“In replacing the functions of local wholesalers, was a proper costing completed to justify PHA doing their own procurement, warehousing, delivery, accounting, etc?” Lowe’s Wholesale, Nassau Agencies and Commonwealth Drugs asked.

The PHA has defended its new east Shirley Street facility, saying: “The transformation of the PHA’s Supply Chain Management System is designed to bring about a greater level of efficiency, maximisation of scarce resources, transparency, accountability and a culture of continuous improvement throughout all levels of the supply chain system.

“It is the PHA’s clear intention to ensure that supplies needed for our patients can be accessed 24 hours a day, seven days a week.”

The PHA, though, did not address supplier concerns about its “unrealistic” order quantities, which have been blamed for frequent drug shortages.