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Dodgy PNG contract could cost lives


People are likely to die because of the Australian Government’s decision to axe funding for the supply of medicines in Papua New Guinea, health experts have warned.

The Department of Foreign Affairs and Trade (DFAT) has withdrawn funding for a $38 million program to supply medical kits to almost 3000 health centres across PNG following a flawed tender process administered by the PNG Health Ministry.

The decision has been met with concern and dismay, with Medical Society of PNG Treasurer Dr Glen Mola warning in an interview broadcast on ABC’s Radio Australia it could lead to shortages of quality medicines, putting lives at risk.

“If the health workers don’t receive the medicine they need to treat the patients, well then, the patients die,” Dr Mola told the ABC. “It’s not like in Australia, where the patient can go just to a different facility or go to see a different doctor. When you’re in a rural or remote area of Papua New Guinea, your health centre is the only health facility for your community – there’s no alternative.”

But locals admit the root of the problem is the PNG Government’s handling of the tender to supply medical kits to the country’s health centres.

Three years ago the PNG Government appealed to Australia for help after a corruption scandal left hospitals and other health facilities dangerously low on essential medicines.

For the past two years Australia has directly engaged the International Dispensary Association (IDA) to supply kits to health centres across the country, and Dr Mola told the ABC it had done “a good job”.

But last year the PNG resumed responsibility for procuring the supply of medical kits for 2014 and beyond, which Australia agreed it would continue to fund, subject to a satisfactory and transparent tender process.

However, days after the tender process closed, the PNG Government informed bidders they would no longer be required to carry the international quality management accreditation, ISO 9001.

Subsequently, PNG’s Central Supply and Tenders Board awarded the $28.3 million contract to the company Borneo Pacific Pharmaceuticals Ltd, which does not hold ISO 9001 accreditation, and which has been found in the past to supply substandard drugs.

An investigation conducted in 2011 found all four samples of antibiotics provided by Borneo Pacific from its supplier, the North China Pharmaceutical Group, were sib-standard, with one assessed as most likely a fake.

In addition to its worrying record, the Borneo Pacific bid was more than $9 million higher than that from IDA.

In a statement issued to the ABC, DFAT said its funding was “conditional on the Government of PNG purchasing the kits from a pharmaceutical firm which met international drug quality standards, through a fair, transparent international tender process. Unfortunately, these conditions were not met and the Australian Government will not fund the distribution of medical kits resulting from this tender process”.

It is the outcome Dr Mola and his colleague Nakapi Tefuarani had feared.

In a letter published by the Devpolicy Blog website ( in late November, the doctors warned that Australia was likely to withdraw its funding if the successful bidder procured medicines from “non-GMP (International Good Manufacturing Process” suppliers.

“Then we will be left with local ‘wantok’ distribution companies sending out low-quality and possibly counterfeit medicines to our hospitals and health centres,” they wrote. “This will lead to the deaths of many Papua New Guineans and also much disability.”

Adrian Rollins