Nepal | October 20, 2020

Govt scraps contract with Omni Group

Himalayan News Service
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  • Didn’t receive medical equipment in time
  • COVID testing kits don’t meet standards set by the World Health Organisation
  • Govt flayed for ordering kits that are known for showing false negative results

Kathmandu, April 1

The government has scrapped the contract with Omni Group, the supplier of medical equipment to the government, for failing to supply the promised gear in time.

The government’s decision to scrap the Rs 340-million contract has come at a time when questions are being raised about the accountability of the medical equipment procurement process and the standard of testing kits.

Director General of Department of Health Mahendra Prasad Shrestha told mediapersons at the daily press briefings organised at the ministry today that the government decided to scrap the contract with the business group as it had failed to supply the promised equipment before the deadline.

He said the group was supposed to bring the remaining equipment by tomorrow, but the company did not assure the government of the supply. He added that the department would blacklist the company for failing to provide medical equipment on the stipulated date. He said the department would confiscate the firm’s bank guarantee worth Rs 50 million.

Shrestha said the company had supplied only 10 per cent of the promised gear, which was around 18 per cent of the price the department had agreed to pay to it.

Shrestha added that the department would start a fresh procurement process for necessary medical gear within three days and would seek its supply within five days of signing a deal with the supplier.

Earlier, the government had bypassed minimum quotation and purchased medical equipment and kits at high rate from Omni Group. This had raised many eyebrows and made the entire procurement process suspicious. Moreover, it was revealed that coronavirus test kits worth almost Rs 70 million that the government purchased from China did not meet the World Health Organisation standards.

The government has also stopped the use and supply of these rapid test kits.

Shrestha said the department was testing the efficacy of these kits. “These medical kits were not purchased for immediate use. They are meant to test large number of people if the coronavirus spreads at the community level,” he said.

He added that these kits would be used only if they passed the efficacy test and met the WHO standards. According to him, almost 7,500 rapid test kits brought from China on March 29 are undergoing efficacy tests.

Shrestha added that the government was obliged to purchase medical gear at 20 per cent higher rate as doctors and health professionals urgently needed that to test suspected COVID-19 patients and treat sufferers.

Shrestha said Omni Group was selected from among two companies that promised to bring the equipment within the required time frame and when the government endorsed the group’s tender, it did so only after reducing the price by 0.5 per cent.

He said the department had discussed issues of procurement with 19 suppliers, but they demanded at least 30 days to bring the required equipment.

Despite repeated attempts, representatives of Omni Group could not be contacted for comments.

As per the agreement, Omni was supposed to bring in specific quantities of equipment in batches. For example, it had to bring in 100,000 units of PPEs on Sunday, but only 10,000 units arrived. Other equipment, such as N95 masks, surgical masks and surgical gloves, too arrived in less quantities than what was stated in the agreement.

“However, the rapid testing kits that had to arrive in the third batch arrived in the first batch,” said Shrestha.

“Of the 75,000 kits ordered, 50,000 arrived.”

Moreover, the kits are not recommended for use by the World Health Organisation.

The government also drew criticism for ordering rapid testing kits that are known for being non-reliable and showing false negative results. Many countries have already banned use of such kits. Initially, the government defended the procurement stating that the high price was due to shortage of such equipment in the global market.

Meanwhile, Khem Bahadur Karki, health adviser to minister of health and population, issued a press release stating that the government had directed the authorities concerned not to use the rapid testing kits for the time being.

A version of this article appears in e-paper of The Himalayan Times on April 02, 2020.

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