Cartels out to derail plans to scrap procurement mandate from Kemsa

The proposed radical changes at the Kenya Medical Supplies Authority (Kemsa) which are still at their formative stages seeking to streamline operations and create efficiency at the graft laden institution could soon hit headwinds before taking off as tenderpreneurs and politicians angle to derail the revolutionary reforms by Health Cabinet Susan Nakhumicha including scrapping procurement mandate from the national drugs agency.

This will be the first litmus test and major hurdle the Health CS is likely face as cartels fight to retain a firm grip at the heavily funded drugs agency both by the government and donors to procure pharmaceutical and non-pharmaceutical products worth billions of shillings annually.

The Informer Media Group has established that senior officials at the Ministry of Health (MoH) could be leaking reform strategies by the ministry to politicians and tenderpreneurs who might hijack the reforms process at the National Assembly.

“We are aware that politicians and influential businessmen who are the main beneficiaries of the multi-billion contracts at Kemsa mostly funded by Global Fund, USAID, the government of Kenya among other agencies are out to scuttle this process. The proposed changes which are still at the formative stages at the policy level at the ministry are likely to be hijacked in parliament and annul the whole exercise.” An insider privy to the goings on intimated.

Key among the changes Nakhumicha is mulling to implement if the proposed reforms sail through include scrapping procurement mandate from Kemsa and relegating the same to another agency under MoH.

In the proposed raft of measures, Nakhumicha is also mulling to make Kemsa competitive enough in terms of pricing of drugs supplied to government and county hospitals in comparison to private sector market prices.

When contacted earlier today, the CS was not reachable for comment.

So far, the much publicised reforms at the authority including sending almost all staff members on compulsory leave have stalled as the agency continue to spend Sh45million shillings to cater for those working and another Sh45million to cater for those sent packing inform of salaries and allowances every month.

Also, recruitment process of the current Chief Executive Officer (CEO) Terry Ramadhani Kiunge has since been challenged as irregular.

Kemsa is not new to controversy.

Between June and mid-October last year, Kemsa made questionable payments amounting to Sh907million for Covid-19 supplies.

According to investigations by The Informer Media Group, some of the companies paid were adversely mentioned in the initial Sh8.3billion Kemsa Covid-19 billionnaires heist that attracted multi-pronged investigations by the National Assembly and Senate Health committees alongside National Assembly Public Investments Committee and Eacc respectively in 2020.

According to records in our possession, Shop “N” Buy Limited, one of the firms that elicited national public outrage for receiving Sh970million for supplying PPES to Kemsa in the initial heist probe, last year in July and September, the same firm was paid an additional Sh499million.

Records show the money was paid in three equal tranches of Sh166,250,000 each on July 8, July 27 and September 7, 2022 respectively.

The three payments in favour of Shop “N” Buy Ltd were made vide Order No.832219, No.832252 and No.832223.

During the 2021 parliamentary committee probe hearings, Shop “N” Buy Ltd owner James Cheluley confessed that he registered the firm on February 14, 2020 and was awarded the lucrative tender a day after he sought to supply the government agency with the medical equipment.

Similarly, La Miguela Holdings Limited which also implicated in Sh180million payment in the stalled investigations was paid a total of Sh90million in three tranches of similar amount of Sh30million each on July 27, July 8 and September 30, 2022.

Appearing before the National Assembly’s Public Investments Committee (PIC) probing the expenditure of money in the purchase of the Covid related equipment in 2020, La Miguela Holdings Limited director James Njuguna told the committee that he was an “innocent passer-by” who landed a Sh180 million tender for the supply of Personal Protective Equipment (PPEs).

Others that received payments last year for supplying Covid-19 related items include; Medilife Biologicals Ltd (Sh110million), Trippleage Investment Limited(Sh25million) and Abyssinia Group of Industries (Sh18million).

Other multiple companies were flagged as having been part of the infamous Covid-19 billionaires.

However, up to date, no supplier has ever been charged over what is believed to have been a well-orchestrated looting. At the time, sacked Kemsa boss Dr. Jonah Manjari was serving as the CEO.

Among other irregular procurement flaws cited under Ramadhani’s tenure include payment of Sh8million to a single-sourced law firm not included in the list of authority’s legal services providers and single sourcing of JKUAT Human Resource and Board Secretariat Services paid Sh1.5million monthly.