Gov’t saves P2-B from medical supply procurements

Published September 16, 2020, 10:41 AM

by Chino S. Leyco

The Duterte administration saved about P2 billion from the purchase of essential medical supplies needed by the Department of Health (DOH) for its COVID-19 response, the Procurement Service of the Department of Budget and Management (PS-DBM) said.

Department of Budget and Management (DBM / FACEBOOK / MANILA BULLETIN)

In a statement, PS-DBM said the government purchased the DOH’s COVID-19 medical supplies like test kits, at a much lower price than the approved budget in line with President Duterte’s policy to make the procurement process efficient and economical.

From March 26 to August 5, the difference between the allocated budget set on by DOH and the PS-DBM’s actual purchased price from several local and foreign suppliers and manufacturers amounted to about P2 billion.

For instance, the DOH’s procurement of initial 4,167 Sansure Novel Coronavirus Nucleic Acid Diagnostic test kits, the department saved P4 million after the contract was awarded to the lowest bidder Pacific Field Hong Kong Ltd. for P6.1 million, or P1,464.88 per test, last April 20.

The PS-DBM said that Pacific Field Hong Kong bagged the contract for the test kits because it submitted the most advantageous offer based on the market price surveys conducted by the DOH and procurement service.

The DOH also had a windfall of P78 million from the purchase of medical supplies from local distributors Pharmally Pharmaceuticals Corp. and Lifeline Diagnostic Supplies, Inc.

Pharmally Pharmaceuticals offered its A*Star Fortitude Kit for P1,720 per test, while Lifeline Diagnostic Supplies gave its Macherey Nagel extraction kit for P625 per preparation or P31,250 per kit.

However, PS-DBM said they encountered challenges in getting more qualified local suppliers capable of meeting the requirements of the DOH due to business disruption caused by the community quarantine and high global demand of medical supplies and equipment.

To address the problem and in an effort to further lower procurement cost, the PS-DBM, headed by Budget Undersecretary Lloyd Christopher A. Lao,  directly negotiated with medical equipment manufacturers in China.

The PS-DBM sought the assistance of Chinese Ambassador Huang Xilian to help the Philippine government procure Sansure test kits from China at P918 per test, cheaper by 45.9 percent than its first procurement.

The PS-DBM’s direct procurement of Sansure test kits from the Chinese manufacturer allowed the DOH to save about P178 million.

Likewise, the Chinese Embassy helped the PS-DBM in facilitating the procurement of MiRXES (A*Star) Fortitude test kits at P925.27 per test, which is 60.09 percent lower than the first buying price.

The PS-DBM also bought Macherey Nagel extraction kits at 36.26 percent lower than the first buying price of P433.22 per preparation, equivalent to about P80 million in savings.

In total, DOH saved around P1.2 billion for the procurement of test kits, extraction machines, and other consumables, and another P800 million from the purchase of personal protective equipment sets.

Under the rules, the procurement process commences when the PS-DBM receives an Agency Procurement Request (APR) from national government agencies such as the DOH, detailing the items’ technical specification, quantity and budget earmarked.

After receipt of such APR, the PS-DBM hold its own market scanning wherein interested suppliers submit their price offer relative to the item to be procured.

Lastly, the PS-DBM assured it is committed to transparency and accountability, as it also encourages both local and foreign businesses that have the capacity to participate in the public bidding by submitting their bids and offers to the Procurement Service.

“The PS-DBM reiterates its commitment to be of service to the Filipino people by providing smart procurement solutions especially during this pandemic,” the agency said.