The Department of Chemicals and Fertilizers may soon finalize a cabinet note on introducing quality criteria along with L1 purchasing system for bulk procurement of medicines by public sector institutions or organizations. The move is to ensure that quality doesn't suffer while accepting the lowest priced tenders for supply of medicines.

The ministry move may result in the introduction of another level of screening before the companies that are interested in government tenders. SSI units, unless they brace up their quality parameters, may find the new specification difficult.

It is felt that the Ministry of Chemicals and Fertilizers may recommend a set of quality testing parameters for participating in government supplies thereby making quality assurance an equally important component of the tender system.

Interestingly, the turnover criteria, introduced by several public sector organizations central agencies have already made life difficult for small players in the drug manufacturing segment. The effect of the quality based pre-qualification on SSIs is also keenly watched.

It should be noted that the need for quality check in government drug purchase was pointed out by the Prime Minister's Task Force headed by Dr Pronab Sen some months ago. The committee had stated that "in order to determine the reasonableness of the ceiling prices fixed as above, the L1 prices quoted in bulk procurement by Government and other designated agencies may be examined for use, provided that the system of bulk procurement meets certain minimum prescribed standards"

It had also said that the system of procurement in the Central Government must essentially ensure that quality drugs are purchased and that drugs have active ingredients at the maximum level throughout the shelf life period of the drug. According to the report, the main guiding factors for procurement of bulk purchase of medicines by various government agencies were (a) procurement preferably in the form of generic drugs and (b) procurement only from pre-qualified manufacturers of drugs.