CAG finds lapses in TNMSC

The Comptroller and Auditor General of India (CAG) has found several deficiencies in the functioning of the Tamil Nadu Medical Services Corporation (TNSMC). In its report tabled in the Assembly on Tuesday, CAG said there were issues of non-supply/short supply of drugs to hospitals, deficiencies such as procuring of short-expiry drugs, non-blacklisting of suppliers for deficiencies in supply and issues in quality control.

The CAG’s performance audit on “Public Health Infrastructure and Management of Health Services” noted that during 2016-2021, 185 suppliers supplied 1,447 drugs, which were manufactured much earlier than 30 days before the date of supply. Audit scrutiny revealed that such drugs costing Rs. 11.12 crore had expired while in stock during 2016-201. The audit noticed that the suppliers had replaced the expired items only in 13 instances of which 10 related to 2020-2021 or later. It observed that TNMSC failed to fix responsibility on suppliers for belated supply. As per tender conditions, the tenderer should supply the product within 30/40 days from the date of manufacture or replace the short expiry or expired quantity with fresh stock.

The audit also observed that the Quality Control (QC) system was deficient. It was found that during 2016-2021, in 13,922 cases, drugs lying in warehouses for more than six months were not sent for quality testing as per QC policy and procedures. The Drug Distribution Management System lacked a feature to alert the warehouse managers on the QC issue.

During the same period, in 19 instances, drugs supplied by different suppliers failed QC in government laboratories more than two times. Out of the 19 instances, suppliers were not blacklisted in 14 instances. It also noticed that drugs supplied by several suppliers were returned from hospitals due to quality issues and complaints.

While TNMSC replied that suppliers were not blacklisted as penalty was imposed instead, the audit noted that QC policy was not implemented scrupulously and instances of failures in quality testing were very high in numbers.

There were lapses in terms of distribution of drugs after “Stop Issue” order. If a drug fails in the quality test of the empanelled analytical lab/government lab, the “stop issue” order is issued to all warehouses to stop distribution of the drug to healthcare facilities and to retrieve the quantity already issued to hospitals.

During 2016-2021, warehouses issued 15.92 lakh quantity of 17 drugs worth Rs. 16.02 lakh in 520 instances to various healthcare facilities across the State. Scrutiny revealed that one drug – Inj Dexamethasone Sodium Phosphate – alone was issued in 330 instances out of the 520. The audit noted that lapses on the part of TNMSC had resulted in lifting of non-standard quality drugs for issue to patients by hospitals.

The report also noted that many equipment were under disrepair despite availability of a system for Annual Maintenance Contract and several newly procured medical equipment were not installed and commissioned for more than two years due to procurement without assessing the requirement.