Zaliha Refuses To Confirm If MOH Will Sue Pharmaniaga Over Defective Ventilators

Dr Zaliha Mustafa refuses to confirm with the media if MOH is suing Pharmaniaga for a refund of defective ventilators, as reported by PAC. “You can read the report. We didn’t issue any official statement. For now, we aren’t taking any action beyond that.”

KUALA LUMPUR, Nov 2 – Dr Zaliha Mustafa today declined to confirm if the Ministry of Health (MOH) is planning legal action against Pharmaniaga Logistics Sdn Bhd (PLSB) for the reimbursement of defective ventilators supplied during the Covid-19 pandemic.

At the health minister’s press conference in Parliament, a reporter cited CodeBlue’s report on the MOH’s preparation to sue PLSB – a fully-owned subsidiary of government-linked corporation and long-time supplier of the MOH, Pharmaniaga Bhd – for a refund of 104 defective ventilators, according to the Public Accounts Committee (PAC) report tabled in the Dewan Rakyat last Monday.

“You all can actually read the report,” Dr Zaliha told reporters.

“We didn’t issue any official statement on this matter. For now, we aren’t taking any action beyond that.”

According to the PAC’s report on Covid-19 management, MOH deputy secretary-general (finance) Norazman Ayob told the parliamentary committee last August 22 that the MOH has drafted a letter of demand to file against PLSB for reimbursement, but the company verbally indicated that it would challenge the legal action because of its belief that it had acted under the MOH’s instructions in the procurement of ventilators during the pandemic.

As such, the MOH has yet to dispose of the 104 defective ventilators in order to retain them as evidence, in case PLSB contests the ministry’s demand for reimbursement and the matter goes to court.

Under Prime Minister Anwar Ibrahim’s administration, the MOH went ahead last July to renew its concession with PLSB for a whopping seven years for medical supply logistics services until June 30, 2030.

Dr Zaliha told Parliament in a written reply last June that the MOH had decided to renew PLSB’s concession due to its “excellent” delivery performance, citing the company’s 98 per cent fulfilment rate in delivering orders within seven working days in Peninsular Malaysia and 10 working days in Sabah and Sarawak.

The bipartisan PAC investigation into the government’s Covid-19 response concluded that no one could be held accountable for the supply of 104 defective ventilators from China, which comprised 76 per cent of a total of 136 units supplied by PLSB in 2020, due to the absence of a formal contract between the MOH, PLSB, and ventilator suppliers in China.

It was also revealed in the PAC’s report that then-Transport Minister Wee Ka Siong had provided the China contact for the ventilators, with the MCA president playing an active role in every aspect of the ventilator procurement process from China, although then-MOH secretary-general Chen Chaw Min acknowledged that he had made the final decision as the Controlling Officer (Pegawai Pengawal).

MOH officials also told the PAC that the ventilators procured from China by PLSB for Malaysia’s MOH had arrived without any warranty – as the MOH had to “plead” with suppliers for the lifesaving equipment – and were deemed “not fit for purpose”. One supplier in China can no longer be contacted.

The PAC in the 15th Parliament – which specifically looked at expired Covid-19 vaccines, faulty ventilators, and excess personal protective equipment (PPE) under the MOH – also found wastage of 8.5 million Covid-19 vaccine doses that expired by June 15 this year, worth RM505 million. About 88 per cent (or 72.8 million doses) of 83.3 million doses that were projected for need had been given.

The parliamentary committee further identified the potential expiry of more than 850,000 units of boot covers by the end of 2024 worth RM927,000 if they cannot be used by then.

“The ministry takes note of the PAC’s report,” Dr Zaliha told the press conference in Parliament today.

“We also take note of all of the PAC’s recommendations and we will take the appropriate action for improvements in the future, particularly on procurement processes. So I’m confident that we will take a firmer and more efficient stance to ensure that procurement – even during emergency or crisis times – must follow the right procedures. That is the MOH’s stance.”

PAC chairwoman Mas Ermieyati Samsudin told a separate press conference in Parliament today that the PAC has given the MOH two months to respond to five recommendations in its report.

The bipartisan committee led by the Masjid Tanah MP plans to table another follow-up report on the MOH’s response.

The PAC’s five recommendations are:

  1. Taking into account past experience, the Controlling Officer must ensure that the public interest is always safeguarded in emergency procurement.
  2. Even in emergency situations, documentation must be done with the appropriate effort.
  3. The MOH must immediately check the warranty status for all 136 ventilator units and take the appropriate action against the responsible party.
  4. The MOH must make use of the excess PPE as best as possible before their expiration date.
  5. The government should play a role in ensuring that local industries have the capacity to manufacture medical equipment and pharmaceuticals to reduce dependence on foreign countries in empowering the public health care system. 

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