PHC cancels medicine tender awarded to blacklisted company

PESHAWAR: The Peshawar High Court (PHC) on Friday annulled a government contract for the supply of life-saving medicines awarded to Frontier Dextrose Limited, a pharmaceutical company previously blacklisted for allegedly supplying substandard and counterfeit drugs.

The court declared the tendering process void and ordered the Khyber Pakhtunkhwa Health Department to restart the procurement process with full transparency.Justice Syed Arshad Ali authored the verdict, which was announced by a two-member bench comprising Justice Arshad and Justice Dr Khurshid Iqbal.

The petition was filed by a citizen Waqar Ahmad, whose counsel, Shumail Ahmad Butt and Abdul Rahim Jadoon, argued that the removal of a key eligibility clause from the 2024-25 tender allowed blacklisted companies to participate in the bidding process-putting lives at risk and raising serious questions about government oversight.

The petitioners told the court that the KP Health Department annually purchased medicines worth millions of rupees and that, as per long-standing policy, companies found guilty of supplying fake or substandard medicines were barred from participating in tenders.

However, the department excluded this disqualifying clause in the most recent tender, thereby enabling Frontier Dextrose, blacklisted in Punjab, to re-enter the bidding process.The court observed that allowing a company with such a record to supply life-saving drugs not only risked public health but also undermined transparency and public trust.

It noted that the company remained under investigation in Punjab and that authorities failed to justify the removal of the disqualifying clause despite repeated court queries.Health Department officials claimed no bidder raised objections before the bidding process began, but the court rejected this reasoning, stressing that ensuring compliance with procurement rules was the department’s own responsibility.

The verdict said that while Frontier Dextrose claimed it had appealed the blacklisting decision in Punjab, the appeal’s pendency did not justify allowing the company to supply critical medicines.

The court stated that such an exception could be dangerous, as it might allow companies with questionable records to re-enter the system under the guise of legal technicalities.The ruling directed the Health Department to reinitiate the tendering process and include all necessary safeguards to prevent companies with a history of malpractice from participating.

It also emphasized that public funds must be used with accountability and in accordance with constitutional and legal standards.The KP Public Procurement Regulatory Authority had also expressed concerns over the clause’s removal, supporting the court’s view that only firms with a clean record should be entrusted with public contracts related to health and safety.