KUALA LUMPUR (March 30): Pharmaniaga Bhd vehemently dismisses claims by certain quarters that the government is over-reliant on the group as its pharmaceutical logistics and distribution services provider.

It said contrary to the claims, the Health Ministry (MOH) spent about 35% of its pharmaceutical spending via Pharmaniaga, with the group’s role limited to managing the logistics and distribution of the products, as well as holding the drug stockpile to the tune of RM400 million as of Dec 31, 2022. 

"The selection of suppliers, products and prices is all determined by the MOH after it concluded an open tender exercise," said Pharmaniaga in a statement on Thursday (March 30).

Currently, the group serves almost 2,000 government health facilities throughout the country, including door-to-door deliveries to the remote areas of Sabah and Sarawak.

The services are governed by stringent service standards and key performance indexes (KPIs) with the imposition of penalties for any non-conformances.

Nevertheless, Pharmaniaga has consistently achieved more than 98% score of the KPIs which is made possible through a long-term commitment to the investment of extensive logistics infrastructure and network nationwide. 

That includes facilities provided by 14 pharma-grade warehouses and distribution centres located in the Klang Valley, Penang, Sabah and Sarawak, as well as managing a fleet of more than 300 vehicles.

The group also performed more than 450,000 deliveries via land, air, sea and rivers annually and all these deliveries have been successfully completed within the KPI set by MOH, supported by close to 500 logistics and distribution employees who are all locals. 

"Pharmaniaga remains committed to its obligations towards both businesses with MOH and the private sector despite experiencing challenges after announcing its Practice Note 17 (PN17) status recently due to the provision of Covid-19 vaccine stocks.

"As a responsible government-linked company, Pharmaniaga has never defaulted any of its obligations to the financial institutions," it said.

It however acknowledges the recent unexpected delays in payments to its suppliers and assures the situation will be normalised soon. 

Most of the obligations have since been cleared, and the group would continue to honour all obligations to ensure patients’ access to medicine remains uninterrupted and continues to be intact.

https://www.theedgemarkets.com/node/661514