home about us contact us jobs at TI sitemap faq Chapter Zone search
news room global priorities regional pages policy and research tools publications support us
home > global priorities > other thematic... > health > service delivery > procurement
global priorities
  other thematic issues  

Corruption in the procurement of medicines and equipment

The process of getting pharmaceuticals and medical supplies from manufacturers to hospitals and pharmacies and finally to the patient involves many actors, namely national health ministries, manufacturers, hospital procurement officials, international aid agencies, pharmacists and doctors.

Corruption can occur at any stage in this process. Companies may win contracts by bribing procurement officials. Procurement officers may receive kickbacks for purchasing substandard drugs. Centralised stores of pharmaceuticals may be pilfered and the drugs then re-sold on the black market. Corruption can also occur in the procurement of organs for transplantation.

Medical supplies are also stolen from central storage facilities and pharmacies or corrupt procurement officials may intercept them before they even get that far. In Uganda for example, a survey revealed that many health workers steal drugs from hospital stores and use them in their own clinics or sell them in health shops, or even use them for treating patients at home. Stolen drugs can pose serious health risks because they can be repackaged or adulterated.

Recommended Readings

Taryn Vian, ‘Corruption and the Health Sector’
Vian analyses those areas she identifies as particularly vulnerable to corruption within the health sector and outlines some possible approaches for prevention. The supply of drugs and medical equipment is an area of special focus and includes unethical promotion in the registration and selection of drugs; bribes and bid-rigging in procurement; and the diversion of health commodities and budgets. The author examines the above in detail and outlines a series of preventative measures and tools that could be used to combat this sort of corruption.
Management Systems International/USAID, Nov 2002

D. Booth and H. Lucas, ‘Good practice in the development of PRSP indicators and monitoring systems: Integrating PRSP indicators into policy formation processes’
This paper contains the key findings of a desk study commissioned by the Poverty Monitoring Task Team. The paper includes commentary on household surveys and participatory poverty assessments used to formulate longer-term objectives for curbing corruption in healthcare. It hones in on areas most in need of monitoring, how best to conduct procurement monitoring and for whom, and what the information gathered will be useful for.
Overseas Development Institute (ODI) Working Paper 172, 2002.

Paulo Ferrinho, Maria Carolina Omar, Maria de Jesus Fernandez, Pierre Blaise, Ana Margarida Bugalho and Wim Van Lerberghe, ‘Pilfering for survival: how health workers use access to drugs as a coping strategy’
This paper describes widespread pilfering of drugs by health staff in Mozambique and Cape Verde as perceived by health professionals from these countries. The study confirms that misuse of access to pharmaceuticals has become a key element in the coping strategies health personnel develop to deal with difficult living conditions.
Human Resources for Health, 2004

Country Reports

Argentina:
Raphael Di Tella and Ernesto Schargrodsky, ‘The Role of Wages and Auditing during a Crackdown on Corruption in the City of Buenos Aires’, Social Science Research Network, 2001.

Thailand:
U. Tumkosit, ‘Two case studies of corruption in Medicine and medical supplies procurement in the Ministry of Public Health: A framework of relationships between civil society and good governance’, Civil Society and Governance Programme, IDS, 2000

Thailand:
Stuart Cameron, ‘Corruption in the Ministry of Public Health, Thailand’
Global Corruption Report 2006, Box 5.2, p100

Tools and Good Practice

Acción Ciudadana (TI’s Nacional Chapter in Guatemala) has been monitoring medicines procurement and advocating for a rational medicines procurement policy. [Spanish]

Essential Drugs and Medicine Policy, World Health Organisation
Efficient procedures must be in place to select the most cost-effective essential drugs to treat commonly encountered diseases; to quantify needs; to pre-select potential suppliers; to manage procurement and delivery; to ensure good product quality; and to monitor the performance of suppliers and the procurement system. The WHO provides a set of principles that can be reviewed and adapted by individual governments and public or private organizations in the process of developing their own internal procurement procedures.

Practical Guidelines on Pharmaceutical Procurement for Countries with Small Procurement Agencies
This booklet is aimed at countries with small procurement agencies. It is intended to provide practical guidelines for the procurement process. Pre-qualification of suppliers receives special attention as a means of ensuring the purchase of good quality products.
World Health Organisation Regional Office for the Western Pacific Manila, Philippines, 2002

Technical Note on the Procurement of Health Sector Goods
This Technical Note accompanies the Standard Bidding Documents (SBDs) for health sector goods. The SBDs for health sector goods were introduced to facilitate uniformity of approach in the procurement of these items. For example, pharmaceuticals, vaccines, and contraceptives differ greatly from other goods and significant price differences can exist between brand name and generic products. The procurement of medical equipment raises additional complications. Broad specifications that will encourage competition and fair and transparent evaluations of procurement processes are offered here.
Washington DC, World Bank, 2002

International Drug Price Indicator Guide
Management Sciences for Health (MSH) provides a spectrum of prices from pharmaceutical suppliers and procurement agencies, based on their current catalogues or price lists. It also contains prices obtained from international development organizations and government agencies.
Management Sciences for health and WHO, 2001

Drug Price Monitoring Tool
The World Health Organization Department of Essential Drugs and Medicines Policy and Health Action International (HAI) have developed a drug price-monitoring tool that could be used for transparency initiatives. In May 2003 HAI and the WHO Department of Essential Drugs and Medicines Policy published a working draft of a manual to collect and analyse the prices people pay for a selection of important medicines, as well as identifying price components (taxes, mark-ups etc.) and the affordability and availability of key medicines. Governments, NGOs and others concerned about the prices of medicines are encouraged to undertake a survey using the methodology outlined in the manual. Health Action Europe

Declaration of Helsinki
Ethical Principles for Medical Research Involving Human Subjects, drafted and adopted by the World Medical Association in 1964 (and amended regularly thereafter). The Declaration covers fundamental principles of clinical research, such as the need for research to be carried out by scientifically qualified individuals and for the importance of the objective to be in proportion to the risk to the participant.

Pushing Prescriptions, a project of the Center for Public Integrity
The results of a year long investigation into the marketing and lobbying practices of the pharmaceutical industry, with details disaggregated by company (top 20 companies listed).


TI Working Paper No. 01/2006:
Corruption and Paying for Healthcare

Global Corruption Report 2006. Special Focus: Corruption and Health