With the Union health ministry’s decision to stop manufacturing of BCG vaccine in the Chennai BCG VL and purchase the same vaccine from private companies for the national immunisation program, the national exchequer is incurring a big loss through the public-private deal, according to sources in the health ministry.


Government is purchasing BCG and other vaccines from private companies like Serum Institute of India, Pune and Green Signal Biopharma, Chennai by not following the terms and conditions put forward by these institutes to the government, sources in the ministry said.


According to sources, in 2006 government of India had transferred seeds of BCG vaccine to Green Signal Biopharma on the basis of some terms and conditions. As per the contract, the company has to supply 80 per cent of its production to the national requirement of the immunisation programme at a rate fixed by BCG Lab in Chennai. The rate fixed was Rs.18 for one vial of 10 doses, including saline.


But after the closure of BCG VL and other two public sector vaccine units in January 2008, government started procuring vaccines from Serum Institute of India at a rate of Rs.29 for one vial of 10 doses. During this period, government did not ask the Chennai based company to supply even though they had the stock. But the sole order was given to the Pune based company. At last Green Signal had to approach the court for getting order from the government.


Sources in the health ministry said government had given an order to supply 110 million doses of BCG at a rate of Rs.29 (order dated-27/03/09) for 2009-10 when the agreement was with it. Government was purchasing this much quantity of vaccine from Serum Institute at a huge rate putting aside the contract it had signed with Green Signal Biopharma while transferring government seed to produce vaccine in that private company. Sources in the ministry said in India it was the first time the seed was transferred by a high power expert committee to a private company with terms and conditions of transfer.


According to some experts in vaccine field, had the government followed the terms and conditions of BCG Seed Transfer, it could have saved not less than Rs.10 crore in a single year. The country’s demand for BCG vaccine is about 60 million lakh doses as the number of new born infants are approximately 300 lakh. In 2009, government gave order for 110 million doses and in 2010 for 34.5million doses to Serum Institute. In 2010 it gave trial order for 5 lakh doses to Green Signal Biopharma.


Information from reliable sources revealed that Green Signal had approached the court for getting trial order from the government; consequently they got a trial order for five lakh doses’ supply for 2010-11. But the company has also put the same rate as quoted by Serum Institute for one vial, sources said.


Health ministry sources said that the Serum Institute of India got seeds of Diphtheria, Pertussis and Tetanus from CRI Kasauli free of cost in 1987 without any terms and conditions between the government and the company. But, for the last 20 years the company has been supplying these vaccines to the government at a rate fixed by the company itself. Some vaccine experts in the health ministry said that, had the government fixed a rate based on some terms and conditions, it would have saved crores of rupees for the last two decades in procuring DPT group of vaccines for the country's immunisation programme.


Experts in the vaccine sector ask why government is not procuring the full quota from Green Signal Biopharma when it has a contract with the company. The company has to supply the vaccine for Rs.18 per vial, but the government is procuring it for Rs.29. They said if the government had purchased 110 million doses from Green Signal for Rs.18, it would have saved Rs.10 crore in 2009-10. Similar profit would have got in 2010-11 also.


While BCG Lab in Chennai was supplying the vaccine, from 1999 to 2008 it supplied only 60 million every year for the immunisation program. But now in the last two years, the government has ordered for 145 million doses in place of 120 million. This shows a huge quantity of excess vaccine is procured from the private companies.