COA: Lung Center’s purchase of P6.4M worth of medical gases failed to undergo public bidding

The Commission on Audit (COA) has flagged the Lung Center of the Philippines' (LCP) purchase of P6.4 million worth of industrial and medical gases in 2018 which failed to undergo a public bidding as required under government procurement rules.

COA auditors said the LCP instead opted to split the acquisition of gases, including liquid oxygen for patient use, which is also prohibited by COA Circular No. 76-41. They said only one supplier brought the gas supply to the LCP.

Some of the irregularities found by COA in the procurement include the lack of an invitation to bid published in newspapers, no abstract of bids showing the price offers of other suppliers, and the winning supplier was not required to post a performance security bond.

The COA further said no memorandum of agreement was signed between the LCP and the winning supplier, which it did not name in the audit report, therefore "raising some doubts on the reasonableness of the price of medical gas/oxygen purchased from the supplier."

"Life-saving oxygen supply is of critical importance to a hospital; hence, there is a need to ensure that the hospital has the right system supported by an experienced and reliable supplier," the audit report said.

In its recommendations, the COA urged the LCP to conduct a public bidding for its future purchase of industrial and medical gas supply.

The commission said the LCP should also stop splitting acquisition contracts and always sign a memorandum of agreement with a winning supplier to ensure appropriate safety measures for every delivery.

LCP management explained to the COA that the public bidding was overlooked due to its many projects, but said the purchase price for the 2018 supply remained the same when the supplier was first tapped in 2015.

The LCP vowed to prioritize the conduct of a public bidding for the supply of medical oxygen for the first quarter of 2019 and will strictly monitor the contracts it signed.

The COA, in its rejoinder, said it expects the full compliance of the LCP to its suggestions. — RSJ, GMA News