KUALA LUMPUR, Oct 30 – Parliament’s Public Accounts Committee (PAC) concluded that no one can be held accountable for the supply of defective ventilators during the Covid pandemic, due to the absence of a contract between the Ministry of Health (MOH), Pharmaniaga Logistics Sdn Bhd (PLSB), and ventilator suppliers in China.
PLSB is a fully-owned subsidiary of local pharmaceutical company Pharmaniaga Bhd.
In the executive summary of its 511-page report on Covid management tabled in Parliament today, the PAC stated that Pharmaniaga Logistics’ role in the emergency procurement of over 100 defective ventilators was “unclear”, making it difficult to pursue legal action.
“The absence of a written contract between MOH and Pharmaniaga Logistics has resulted in no party being accountable for the malfunction of 104 ventilator units (done under emergency procurement protocols).
“To date, the ambiguity of Pharmaniaga Logistics’ role in this matter has hindered legal action from being carried out,” PAC said in its Covid management report on expired vaccines, defective ventilators, and excess personal protective equipment (PPE) under the MOH.
According to the PAC, not only was there no official contract between the MOH and PLSB, the MOH’s legal advisor was not consulted in Pharmaniaga Logistics’ appointment in the procurement of ventilators.
“The discussions, assessments, and decisions related to ventilator procurement had to be carried out outside the norm, primarily through WhatsApp due to the constraints during the Movement Control Order (MCO) and the urgency and pressure of the situation at that time.
It was noted that “despite lacking experience and expertise” in the procurement of medical equipment, particularly ventilators, Pharmaniaga Logistics was instructed to make advance payments for ventilators due to MOH’s existing relationship with the company.
Pharmaniaga Logistics’ role in the procurement of the ventilators was “only to manage the delivery of ventilators to health ministry facilities” and to “assist the ministry to contact the manufacturer to use the warranty of ventilators that cannot be used”, the PAC said.
The PAC’s probe follows a national audit report in February which revealed that Pharmaniaga Logistics supplied the MOH 93 defective ventilators in early 2020 during the Covid-19 pandemic that cost the government an estimated RM13.07 million in losses.
According to the audit, Pharmaniaga Logistics supplied 136 ventilators, of which only 28 were usable. The remaining 108 ventilators were not safe for use on patients.
Of the 108 unusable ventilators received by the government, 15 were returned to the overseas manufacturer for replacements, while 93 failed technical specifications tests, and performance and quantitative tests.
Among the defects of the 93 defective ventilators were “alarm failed when maximum pressure triggered, O2 concentration monitoring not available, peep pressure option not available, compressor can switch on but no pressure provided, and O2 cell faulty”.
The PAC’s report revealed that the defective ventilators were sourced from China, marking the first time the MOH had procured ventilators from China, as options were limited due to global movement restrictions caused by the pandemic.
Upon receiving the ventilators, it was discovered that the received items did not meet the terms and conditions, despite prior review by MOH experts.
The PAC said that the issue with the ventilators was that the plug type (Type A) of the received ventilators differed from the electrical outlets used in Malaysia (Type G).
Pharmaniaga Logistics later recommended that the MOH appoint IDS Medical Systems (M) Sdn Bhd (IDSMED) to evaluate the 136 ventilators received from China. IDSMED would then propose necessary repairs for the unusable ventilators.
However, even after the plug upgrades, most ventilators still faced issues with their hardware, accessories, and software.
Apart from the absence of a contract between MOH and PLSB, there was also no formal contract signed between PLSB and the ventilator suppliers in China. The payment process by MOH also did not involve physical cash; instead, it had to be channelled through the embassy or the Ministry of International Trade and Industry (MITI) in China.
The PAC further pointed to discrepancies on whether all 136 ventilators procured from China came with a warranty.
Pharmaniaga Logistics stated that all purchase order and quotation documents indicated that the warranty was provided by the supplier. The PAC, however, found that the quotation documents did not cover all 136 ventilator units, and there were no acknowledgment receipts.
MOH, on the other hand, reported that warranties were only provided by Pharmaniaga Logistics for ventilators that had been upgraded.
The PAC’s proceedings were conducted on June 15, August 22, September 14, and September 21 this year.
A total of 12 witnesses were summoned, including former and current MOH officials, Pharmaniaga Bhd’s past and present top management, and Ayer Hitam MP Wee Ka Siong.