Ukraine has signed a contract with U.K. company Crown Agents for the purchase of coronavirus vaccine produced by Chinese company Sinovac Biotech, Ukraine’s Health Minister Maksym Stepanov said during a briefing on Jan. 15.
It was a surprising decision because earlier in December, Ukraine signed a contract with state-owned enterprise Medical Procurement of Ukraine, which was supposed to buy the COVID-19 vaccine for the country.
According to Stepanov, the Ministry of Health changed its mind because last year it was unsatisfied with Medical Procurement’s work. He said the company delayed procurements and bought medicines for Ukraine at inflated prices. Additionally, in 2020, the company didn’t finish the procurements of 180 types of pharmaceuticals worth nearly $36 million, including drugs to treat children with cancer and HIV patients.
Medical Procurement’s spokesperson Kseniya Kvitka told the Kyiv Post that the enterprise is disappointed that Ukraine turned to a foreign enterprise to procure the COVID-19 vaccine but declined to comment further. Kvitka said the company first has to figure out what this decision means and what to do next.
According to Kvitka, Ukraine’s Ministry of Health hasn’t warned the enterprise that it chose another procurement company. Medical Procurement first heard about the news from Stepanov’s interview with Ukraine 24 television channel on Jan. 14, Kvitka said.
There are both positive and negative sides to the ministry’s decision. On the one hand, Crown Agents is a reliable company that has worked with Ukraine since 2015 procuring cancer drugs, HIV diagnostic systems, vaccines and medicines for children and adults. On the other hand, the decision to clamp down on the state-owned procurement company shows that Ukraine’s government is untrustworthy and cannot handle the purchase by itself, experts said.
Reliable partner
Stepanov said that Ukraine can trust Crown Agents: The company is internationally recognized and best known for its transparency. During the pandemic, it procured and supplied protective equipment, COVID-19 test kits and medicine to the U.K., Ukraine, Dubai, Singapore, Japan, Myanmar, Australia and New Zealand.
Crown Agents is also more effective than Ukraine’s Medical Procurement, Stepanov said. The company always purchases medicine on time and at the best prices, he added. Since 2016, it has saved Ukraine’s Ministry of Health around $62 million, according to the company’s website.
Experts agree: “There are no reasons not to trust Crown Agents,” said Inna Ivanenko, the executive director at the nonprofit Patients of Ukraine.
In 2020, the company procured supplies for 14 Ukrainian programs, including medicines for patients with highly lethal infectious diseases, children with mental and behavioral disorders and children with cancer.
Crown Agents told the Kyiv Post that the company signed the deal about the procurement of the COVID-19 vaccine for Ukraine on Jan. 13. Ukraine agreed to pay the company after Crown Agents will comply with all the requirements in the contract.
‘Unreliable’ partner
During the briefing on Jan. 15, Stepanov called Medical Procurements inefficient because it failed at 20% of its procurements.
Kvitka confirms that the company couldn’t finish its purchases because the government didn’t send it the necessary documents on time and often postponed the procurement process.
Ivanenko said that Medical Procurements’ last year’s results were satisfying, “considering all the pressure” from the Ministry of Health.
Medical Procurement was created to buy drugs and medical supplies independently at the best possible prices. It was meant to keep medical spending transparent, out of the hands of corrupt officials. But the Ministry of Health has challenged its independence after approving a resolution that allows it to control procurements.
According to the resolution signed on Oct. 27, Medical Procurement has to check every purchase with the Ministry. It also gives the Ministry an exclusive power to set technical standards for medical goods.
By refusing to work with the state-owned enterprise, Ukraine further undermines its image, Ivanenko said.
“It ruins the whole idea of the independent procurements,” she told the Kyiv Post.
Ukraine’s Medical Procurement doesn’t charge a commission for its purchases — it is financed by the government. Although Stepanov said that the company receives money on time, Medical Procurement disagrees. In a statement published on Jan. 6, the company said that its budget still hasn’t been approved and it lacks the money to pay rent and salaries.
Ukraine’s health ministry has done everything it could to interfere in Medical Procurement’s work and now blames it for inefficiency. For example, it hasn’t allowed the company to start procurement for months, causing critical drug shortages.
Anti-corruption watchdogs believe that corrupt officials stand to lose too much money to allow Medical Procurement to remain independent and functional.
