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Coronavirus crisis: Congress slams govt for allowing 'hoarding', profiteering on rapid test kits sold to ICMR

Coronavirus crisis: Congress slams govt for allowing 'hoarding', profiteering on rapid test kits sold to ICMR

Congress leader Manish Tewari alleges distributor supplied rapid testing kits to ICMR for Rs 30 crore, earning Rs 9-crore profit. He says private companies earned Rs 18 crore - over 100 per cent profit -- on the supply of just 5 lakh test kits

Notably, ICMR has put the rapid tests on hold after detecting faulty results from the Wondo kits Notably, ICMR has put the rapid tests on hold after detecting faulty results from the Wondo kits

Congress leader Manish Tewari has blasted the Centre for allowing "hoarding" and profiteering on rapid testing kits at the time of coronavirus crisis. While seeking full disclosure of all documents related to big purchases on rapid testing kits, Tiwari said 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. The same company, Matrix, had sold the same testing kits to Tamil Nadu for Rs 400 each, he said. As per the ICMR, nine of the rapid antibody kits validated by it are manufactured in India, and that it was working towards validating diagnostic kits for COVID-19 testing and screening.

The Congress reaction comes a day after BusinessToday.In reported how a legal dispute in Delhi High Court between the distributor and importer of COVID-19 rapid test kits being shipped from China had unearthed massive profiteering and over-pricing in kits sold to Indian Council of Medical Research (ICMR). Coming down heavily, the Delhi High Court's single bench of Justice Najmi Waziri disallowed a 145 per cent mark-up from landed price of Rs 245 to ICMR's purchase price of Rs 600 per test. Also, Justice Waziri slashed price for every kit by 33 per cent from Rs 600 to Rs 400 per test.

Also read: Massive 145% profiteering exposed in coronavirus rapid test kits sold to ICMR

The order was against a petition by Rare Metabolics, the sole distributor of rapid antibody test kits imported by Matrix Labs, the respondent in the case, from China's Wondfo Biotech. The dispute was over release of the remaining 2.24 lakh kits -- of the 5 lakh imported from China -- to be sent to ICMR. Importer Matrix Labs had argued that it had only been paid Rs 12.25 crore of the Rs 21-crore import. As per the agreement, the balance amount of Rs 8.25 crores had to be first paid to the importer before any monies received from ICMR.

Dispute arose after Matrix Labs demanded upfront payment, whereas the petitioner maintained the payment could only be made after ICMR released the funds. The petitioner informed the court the consignment of 2.76 lakh rapid antibody tests had already been supplied to ICMR, for which payment was still awaited.

Notably, ICMR has put the rapid tests on hold after detecting faulty results from the Wondo kits. The Chinese firm has denied that they were faulty kits. After listening to both parties, Delhi High Court decided that 2.24 lakh tests shall be delivered to ICMR, the moment it lands in India. The balance amount of Rs 8.25 crore has to be first paid to importer Matrix Labs in 24 hours of petitioner receiving monies from ICMR, before they are adjusted for any purpose. The court also ordered that the remaining 26,000 kits from the Tamil Nadu government's order to be provided directly to the state, the moment they reach India.

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