The Telangana Anti Corruption Bureau on Friday arrested seven persons for a scam in procuring medical supplies for the ESI hospitals across Telangana. The ACB had on Thursday booked cases against 17 government officials with the department of IMS that deals with medicine procurement and 4 private persons for causing a loss of Rs 9.4 Crore to the public exchequer. The Director of IMS Dr CH Devika Rani has also been accused in the multi-crore scam and has been taken into custody. The officials are accused of creating false requisition orders and falsifying records to benefit a few pharma companies.
As of Thursday, the ACB conducted raids across 23 places in Hyderabad and Warangal in an investigation that began two months ago. The Director of IMS Dr CH Devika Rani, and 16 other government officials, have been accused of making fake requisition orders, falsifying records, violating rules and regulations in purchasing medicines and surgical kits causing loss to the state exchequer. A requisition order is essentially a request for supplies, after which a purchase order is issued. The scam was detected in the procurement of medicines and surgical kits for the Employee’s State Insurance (ESI) hospitals across the state.
Apart from the IMS director the ACB also arrested the Joint Director K Padma, the Assistant Director Vasantha Indira, Senior Assistant Harshvardhan, a pharmacist Radhika, the Managing Director of Omni Medi, Srihari and his employee Nagaraju.
The ACB, in their course of investigation, found two fake requisitions to medicines worth Rs 1,03,13,247 that were prepared by Dr K Padma, Joint Director Hyderabad on May 26 and 28 in 2018. These requisitions were sent and the bills claimed through dispensaries at Patancheru and Borabanda. However, the ACB found that these dispensaries never had the medicines mentioned in the requisition order. The bills, however, were passed by the IMS Director.
“Preliminary investigation revealed that Dr Devika Rani diverted over Rs 300 crore by purchasing drugs and surgical kits from ‘unauthorised’ firms under the guise of ‘emergency’ and caused huge loss to the government exchequer,” said an official associated with the investigating agency to The Hindu. Dr CH Devika Rani had taken over as IMS director in 2015. “The firms from where the department was purchasing the medicines by paying 100 to 300 per cent more than the rate contract were not included in the RC list,” the official told the newspaper.
The ACB found that medicines worth Rs 1,22,51,291 were also ordered and received by Dr Padma, but the stocks were not sent to the said dispensaries.
Devika Rani and her assistant director Dr K Vasanta Indira stand accused of causing a loss of Rs 9,43,47,947 to the public. The medicines ideally should be purchased through Rate Contracts, but for the year 2017-18, the drugs were purchased through the Special Drug Dispensing Unit in local purchases. Medicines are to be procured from local supplies only in the case of an emergency. However, “After a closed-door pre-bid process, they have accepted the quotations from three or four companies set up by Dr Devika Rani and her colleagues,” said the official.
The officials, in the month of August 2018 alone, observed that 286 purchase orders were released by the said officials claiming them to have been issued in May. The officials also cancelled 26 previous purchase orders by falsifying records and the move benefitted some pharma companies, found the ACB.
Apart from the 17 government officials, cases have also been booked against four private persons. The managing director of Omni Medi, Srihari, and a representative of the firm Ch Siva Nagaraju, have been booked in the case. Cases have also been registered against B Sudhakar Reddy, an agent of Teja Pharma and K Narender, a reporter with the V6 TV channel.
