Payment of ₹200 crore to drug companies for supply of Remdesivir in Karnataka stuck due to breach of tender condition

According to the rules, a third-party lab test prior to supply of medicines to the government is mandatory. This condition was breached citing the high demand from patients at the height of the second wave of the Covid-19 pandemic

Remdesivir injection, which was considered a crucial drug in COVID-19 treatment protocol, became a household name during the second wave of the pandemic in 2021. While the pandemic threat has receded, it turns out that the Karnataka Government is yet to pay the dues to companies supplying the drug, which adds up to ₹200-odd crore, on account of violation of a tender condition that testing 10% of all supplies to the government is mandatory.

More than a year after the drug was supplied, payments to major pharma companies are stalled due to this violation.

During the second wave of the pandemic in 2021, the critical injection was procured by the government through Karnataka State Medical Supplies Corporation Ltd. (KSMSCL), a nodal agency for procurement of all government-related medical supplies in the State.

The delay in payment of dues has been attributed to violation of tender condition for medical supplies to the government that mandates a third-party lab test prior to supply. However, these lab tests were not conducted citing the medical emergency starting from April 2021.

Remdesivir was in very short supply. Scenes of relatives of patients desperately searching for Remdesivir were all over social media and news publications. A few persons managed to procure the drug from the market by paying a premium

“Such was the demand that not even a single sample of those batches is available for testing (if testing were to be carried out today),” said a supplier of medicine to the government.

The supplier argued that the lapse was only ‘procedural’, and not something that put patients at risk. “This condition exists to ensure that the quality of drugs supplied to the government is not inferior in standard as compared to what is released in the open market. The high-end drug was tested in labs by the manufacturers as per strict protocols and certified safe. Given the emergency during the height of the pandemic, the third-party testing was foregone to save time and speed up supplies to the government,” he claimed.