Several Indian States have
recently floated Global Tenders for supply of millions of dozes of Covid
vaccine. May be close to 12 States asking for 500 million dozes of vaccines
These figures must be
looked in the light of following :
Ø Currently
there are only 2 Indian Manufacturers
Ø During
the next 6 months ( June-Dec ), another 4 / 5 Indian manufacturers may start
production
Ø Russia
has already started supply of SPUTNIK V( though only a few million dozes )
Ø Other
Foreign Manufacturers are unlikely to quote against Indian tenders( they get
much higher prices from other countries )
===================================================
Now,
it is apparent that :
Ø Demand
is far in excess of supply
Ø Tenders floated by State Govts can be
expected to be shoddily drafted ( - on purpose ? )
Ø Within India, several States will be
simultaneously negotiating with very few manufacturers, pitting one state
against the other, for the SAME capacity
Ø Manufacturers / Suppliers are bound to take
advantage ( of this scarcity situation, leading to intense and unhealthy
competition amongst states and, as a result, pushing up the prices )
Now
there is no denying that a DECENTRALIZED MANNER of purchase process could, well
be much FASTER as compared to a CENTRALIZED purchase on behalf of the States
But,
Ø Was it impossible for all State Tender Inquiries to be posted on central govt purchase e-Portal ?
Ø The QUOTATION FORM was so STANDARDIZED that
it would be very easy to prepare a COMPARATIVE TABULATION of all the offers as
shown below ?
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AN “ APPLE FOR APPLE “ COMPARISON OF OFFERS RECEIVED
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Vendor
A
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Vendor
B
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Vendor
C
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PARAMETERS FOR COMPARISON:
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(
A ) Product
Specifications
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#
Manufacturer / Brand
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#
Whether WHO approved
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# Efficacy %
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#
Storage Temperature Range
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#
Expiry Period
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(
B ) Tenderer / Local
Agent Details
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(
C ) Country of
Manufacture
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(
D )
Base Price ( $
per dose of 10 )
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(
E ) If Imported :
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#
Price Basis ( FOB – CIF )
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#
Import Duty %
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#
Landed Cost
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(
F ) Local Taxes ( GST )
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Final Total Delivered Price ( $ per dose )
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(
G ) Total Quantity
being offered ( Millions )
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(
H )
Delivery to commence from ( date )
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(
I ) Weekly Supply Rate
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(
J ) Commercial Terms
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#
$ / Rs Exchange Rate assumed
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#
Letter of Credit / Progress Payment Terms
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#
Penalty Clause acceptance
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#
Liquidated Damages Cost acceptance
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#
Risk Purchase Clause acceptance
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#
Force Majeure clause acceptance
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#
Offer Validity date
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Product Liability acceptance
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#
Indian Court of Jurisdiction acceptance
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RELATED READINGS :
These scenario need to be
looked at from the following data :
( source : THE 2BN DOSE
QUESTION / Eco Times / Deep Dive / 23 May 2021 )
HEALTH MINISTRY PROJECTIONS FOR VACCINES ( Period
: Aug-Dec 2021 / No of Doses in Millions ) :
Ø Covishield…………….
……………….750
Ø Covaxin…………………
……………….550
Ø Sputnik
V…………………………….. 156
Ø Biological
E……………………………….300
Ø Covavax(
SII-Novavax )……….. 200
Ø Bharat
Biotech Intranasal…………100
Ø Zydus
Cadilla………………………………50
Ø Gennova……………………………………..60
========================================
TOTAL……………………………………. 2166
=========================================
VACCINES PROCURED BY GOI ( Jan – May 2021 / No of doses in Millions ) :
Ø Covishield……………………………………
276
Ø Covaxin………………………………………….80
---------------------------------------------------------------------------------
TOTAL………………………………………….. 356
---------------------------------------------------------------------------------
Now here is the justification
for :
Ø Apple
for Apple comparison
Ø A
single / common JOINT NEGOTIATING COMMITTEE ( with representation of all States
+ Centre )
Extract :
The Mumbai civic body has received three bids for the
supply of the Russian-made Sputnik V Covid-19 vaccine but none of the companies
have produced any documentation connecting them with the vaccine manufacturer.
It has, meanwhile, asked the
three companies that have put in bids, to submit more documents.
“The issue is that the three companies who claim that they can
supply the Sputnik vaccine have not given any documents that connect them with
the manufacturer,” P. Velarusu, additional municipal commissioner, told
ThePrint.
“We don’t know from where they intend to procure the vaccine. We have
asked them to provide these documents, show what agreements they have with
manufacturers and so on.”
Of the three companies that
have submitted bids, one is from the United Kingdom while the other two are
based in India.
A senior BMC official said the two Indian companies seem more
like medicine importers.
The BMC does not know if these companies have supplied Covid
vaccines anywhere else in the world.
“That was not a requirement in our tender conditions. But what
we are absolutely firm on is that these companies must have authorisation from
the manufacturer,” said the official quoted above.
He added that so far there haven’t been any queries, either
formally or informally, from any other companies in response to the global
tender.
The three companies that have shown interest in supplying
Sputnik V for Mumbai have all quoted price points between $18 and $20 per two
doses.
“At the current rate, this
works out to Rs 750 per dose, which is more expensive than the domestic
manufacturers. But we are fine with that,” the civic official quoted above
said.
Serum Institute of India is supplying Covishield, the Oxford-AstraZeneca
vaccine, at Rs 300 per dose to state governments, while Hyderabad-based Bharat
Biotech is supplying the indigenous Covaxin at Rs 400.
Other than the BMC, civic bodies of Navi Mumbai and Thane,
Mumbai’s satellite towns, have also floated global tenders for Covid-19
vaccines. The Maharashtra government too has floated its own global tender for
the supply of Covid vaccines.
===================================================
Raj
may move SC for uniform vaccine pricing /
HT / 24 May 2021
Extract :
Ø The Rajasthan government is planning to
approach the Supreme Court to ask for a new policy that ensures uniform
distribution and pricing of Covid-19 vaccines, said a senior official familiar
with the development. It will be the second state to do so after West Bengal,
which had on May 7 moved the apex court for the exact same reason and demanded
that the states be given the vaccines free of cost
Ø The state has also floated a global tender to
procure 1 crore doses but says that this should have been done by the Centre.
“TThe state can bear the expenditure, but the tender should be floated by the
government of India. The Centre can negotiate for a uniform rate, and check the
credentials and credibility of the vendors,”
Ø
The differential pricing, the official said, will result in
competition among states, as the vendors participating in the global tender are
quoting more than twice the price of vaccine — ₹300
per dose plus GST.
Ø
Vaccine manufacturers SII and Bharat Biotech have been charging ₹150
per dose from the Centre, and ₹300-400 per dose from the
states. The price should be capped at a uniform rate of ₹150,
the official said
===================================================
States
may hit a roadblock in Global Sourcing quest /
Business Line / 24 May 2021
Extract :
Ø Pfizer
has indicated that its discussions will be ONLY THROUGH the Central Government
Ø …..
across the World, Pfizer will supply the COVID – 19 vaccine ONLY to Central
Governments and supra-national organizations for deployment in national
immunization programmes. The allocation of doses and implementation plan within
a country is a decision for local governments based on local health authority guidance
Ø Moderna,
too is said to have told the Punjab government that it would deal ONLY WITH THE
CENTRE
Ø Besides
, there is no excess vaccine supplies as companies have already committed much
of their supplies for the next several months, he ( former Health secretary,
JVR Prasad Rao ) added. States competing for vaccines will push up the price of
vaccines, he said, and the coutry loses its bargaining power and economies of
scale that come from procuring as a single entity
Ø An
industry representative explained: since vaccines have emergency authorizations
in most countries, they will be available ONLY THROUGH GOVT CHANNELS – meaning,
there is no excess stock to tap
Ø Except
for Sinopharm and may be Sputnik-V, it looks unlikely others have capacity to
supply to individual states
===================================================
Dear Chief Ministers of States :
In any industry, it takes
months ( if not years ) to :
Ø Put
up Greenfield manufacturing facilities
Ø Ramp
up existing manufacturing capacities
Hence, all these brave talk
of DECENTRALIZED PROCUREMENT, in itself, is unlikely to get us 2166 million
doses in Aug-Dec ( 5 months @ 430 million doses per month – as against actual
procurement of a meagre 356 million doses in Jan-May , @ 70 million per month !
)
There is just no way,
Pharma Industry can ramp-up vaccine production by 6 TIMES in June-July !
It is time to accept this
ground reality of life and collaborate / cooperate with the Central Government
for a
Ø united
/ joint evaluation of tender offers
Ø joint
negotiations with suppliers
Ø single
order placement ( on behalf of all the States )
Ø Single
Delivery Schedule Instruction to each supplier
It is time to pull
together in one direction rather than pulling in different directions
Through this E-Mail, I am
requesting Dr HarshVardhanji to file appropriate AFFIDAVIT in the Supreme Court
, showing willingness of the Central Govt to coordinate vaccine procurement as
suggested above
With regards,
Hemen Parekh / hcp@recruitGuru.com / 24
May 2021
