After controversy around massive profiteering and over-pricing of rapid testing kits sold to the Indian Council of Medical Research (ICMR), the apex medical research body has clarified that it has not made "any payment" in respect to these supplies. "Because of the due process followed (not going for procurement with 100 per cent advance amount), GoI does not stand to lose a single rupee," an ICMR release said.
Testing kits of two companies -- Biomedemics and Wondfo -- were identified for procurement as they had the requisite international certifications. For Wondfo, the evaluation committee received four bids -- at Rs 1,204, Rs 1,200, Rs 844 and Rs 600. Accordingly, the final bid offer of Rs 600 was considered, the ICMR said.
In the meantime, the body also tried to procure the kits directly from Wondfo through the Consulate General of India. However, the quotation received from the direct procurement had issues such as "quotation was free on board, without any commitment on logistics issues; it was based on 100 per cent direct advance without any guarantee; there was no commitment on timelines; and rates were communicated in US dollars without any clause for accounting for fluctuations in prices," says the ICMR.
Hence, the ICMR decided to go with Guangzhou Wondfo Biotech as its exclusive distributor for the kits, as it quoted an all-inclusive price, without any clause for advance. "It needs to be also remembered that this was the first-ever effort by any Indian agency to procure such kits and the rate quoted by the bidders was the only reference point," the ICMR maintained.
India is procuring about 5 lakh rapid testing kits from China-based Guangzhou Wondfo Biotech. Notably, the ICMR has issued a revised advisory to state governments to stop using rapid anti-body test kits immediate effect. "Based on a scientific assessment of their performance, the order in question (Wondfo), along with the order in respect of another maker, found under-performing has been cancelled," said the ICMR.
The development also comes in the backdrop of a BusinessToday.In report on how a legal dispute in Delhi High Court between the distributor and importer of COVID-19 rapid test kits had unearthed massive profiteering and over-pricing in kits sold to ICMR. The opposition Congress has also blasted the Centre for allowing "hoarding" and profiteering of rapid testing kits at the time of coronavirus crisis.
As per Congress leader Manish Tewari, a company named Matrix Labs, on the recommendation of ICMR was given a contract to purchase 5 lakh test kits for Rs 12.25 crore. He said while the import cost per unit was Rs 245, the importer sold these kits to the distributor for Rs 600, earning Rs 7.5 crore. He alleged the distributor supplied these rapid testing kits to ICMR for Rs 30 crore, further earning Rs 9-crore profit. He said these private companies earned Rs 18 crore - over 100 per cent profit -- on the supply of just 5 lakh test kits.