The Union health ministry is preparing an ambitious project involving Rs.30, 000 crore for a five year period to procure medicines for the public hospitals through a centralised procurement agency so as to make sure that all required drugs are available at the government hospitals.


The project, being submitted to the Planning Commission for implementation during the next Five Year Plan, will make sure that all those coming to the public healthcare institutions across the country get free medicines. This will be executed through the ongoing National Rural Health Mission (NRHM) and the proposed National Urban Health Mission, sources said.


According to the data collected by the health ministry, still 68 per cent of population in the country have no full access to good healthcare facilities and drugs. Hence the first priority is to make accessible medicines in the public health institutions.


The Ministry sources also claimed that the creation of a Central Procurement Agency for buying drugs for all public heath institutions is in 'the advanced stage.' The Planning Commission had already accorded approval for creating the agency and allowed a one-time grant of Rs.50 crore for the purpose.


The professional agency will procure, store, and distribute all heath sector goods for various national programmes under the Ministry. The CPA will be registered as a society under the Societies Registration Act, 1860. “The existing system of procurement and distribution is transparent. Central Procurement Agency is an initiative taken by the Ministry to further improve the existing system,” according to an official in the health ministry.


The CPA is expected to keep services as prime motive. It would seek to put in place transparent and competitive system form procurement so that goods are procured at competitive rates. The agency will set up and manage an efficient supply chain and put in place monitoring system to prevent stock-outs and reduction in wastage due to excess inventory. It will look to improve system of quality control so that the end-user gets quality products. Besides, the agency will have the responsibility to interact with stakeholders on regular basis so as to improve the system further on the basis of their feedback.