Coronavirus: Opposition questions Tamil Nadu govt over high price paid for test kits

Last Updated 28 April 2020, 03:41 IST

Opposition parties in Tamil Nadu on Monday asked the state government to explain its decision on buying coronavirus rapid test kits at "higher price" from an “intermediary company” rather than directly from the importer who is also based in the city.

The parties, including principal Opposition DMK, cited the Delhi High Court order that capped the price of each testing kit at Rs 400, rather than Rs 600 approved by the Indian Council for Medical Research (ICMR).

“It is clear from the court order that the price of one such kit is Rs 245 including the freight charges, but the Tamil Nadu government has procured them at Rs 600 each. It has also come into the public domain that the state government did not buy the kits from an ICMR authorised company, but from an intermediary firm,” DMK President M K Stalin said.

In a statement, he sought to know why the government went for a “non-transparent” method in procuring these kits even as it battles a shortage of funds. He also said the chief minister cannot avoid answering the questions by terming them “politically motivated” as it involves tax payer’s money.

VCK chief Thol. Thirumavalavan’s asked the government to clarify why it chose to buy the kits from an intermediary company rather than procuring them directly from the importer, who is also based in Chennai.

“The company, Matrix Labs, that sold the kits to Shan Biotech at Rs 400 per piece is also from Chennai. If the government had inked a pact with Matrix Labs, it could have saved Rs 200 per kit. Why and how did this happen? The government should explain and be transparent about the process,” Thirumavalavan said. AMMK leader T T V Dhinakaran demanded a white paper on the procurement process.

The Tamil Nadu government had placed an order for 50,000 rapid test kits of which 24,000 have been delivered already at the ICMR approved price of Rs 600 through Shan Biotech, which bought the kits from Matrix Labs, also based out of the city.

Efforts to reach P Umanadh, Managing Director of the Tamil Nadu Medical Services Corporation (TNMSC), the procurement agency, on Monday proved futile. Health Minister C Vijayabaskar rubbished all allegations and said the government was returning all test kits to the Chinese firm. He also punched holes in Stalin's allegations that Shan Biotech was not approved by ICMR, saying it was one of the companies that were given dealership to distribute the kits by Matrix Labs. However, the state government has maintained that it paid the price which was agreed to by the ICMR.

Matrix Labs, which imported the kits from China, said it procured them from a Chinese company, Wondfo, for a price of Rs 245 each which includes the freight price. The company sold the kits at Rs 400 each to Rare Metabolics, which fixed the price at Rs 600 per kit for purchase by ICMR and states.

The price issue came to the fore after the importer and the distributor went to the Delhi High Court to sort out their pricing dispute.

When DH reached out to Shan Biotech, the company tried to shift the blame to Matrix Labs, saying questions should be asked only to the importer or to the buyer, Tamil Nadu Medical Services Corporation (TNMSC).

Likewise, Matrix Labs also tried to wash its hands off the issue saying they were dragged to the court by Rare Metabolics and it is the latter who needs to be questioned not the former.

(Published 27 April 2020, 18:41 IST)

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