GST hits supply of vital drugs in govt hospitals

CHENNAI: Supplying life-saving drugs to government hospitals has become a struggle for Tamil Nadu Medical Services Corporation (TNMSC) since Goods and Services Tax (GST) was rolled out on July 1, as tenderers allegedly refused to supply drugs at old rates.

Owing to the helplessness of the situation, the corporation has issued a ‘No Objection Certificate’ (NOC) to the management of government hospitals to even do local purchase using hospitals funds till TNMSC finalised fresh tenders.

Common drugs and life-saving drugs such as immunosuppresant drug, anti-thyroid drug, anti-diabetic and chemotherapy medication are also not available in government warehouse, revealed a senior health department official.

“The new contract has been delayed since GST, as suppliers were unable to quote prices in the absence of clarity on tax rates of raw materials, transportation and drugs. We sought concurrence to supply at the old rates until the new rates are finalised. All vendors agreed,  except the above mentioned drugs,” the official told Express.

The hospitals are now purchasing drugs using the Dean’s fund and also Chief Minister’s Comprehensive Health Insurance Scheme fund. Hospital authorities also claimed that they they are managing the situation with local purchase.

However, the official said new contract has been finalised and in another few weeks, the drugs will be supplied. “Since the new contract has been finalised and suppliers are available for these drugs, these will be available in a few weeks and local purchase will be stopped,” sources said.

The previous supplies lasted three more months. So,  local purchase has been authorised since October, the official added. “Every year during change of tender, there will be a gap. But, this year, the transition period is longer because of GST and the delay in floating new tenders, the official said.