Beximco counters ACC allegation of Covid-19 vaccine scam

Beximco Pharmaceuticals Limited in a statement today (20 March) expressed "concern and disappointment" at the "misleading and defamatory" news published on 17 and 18 March in several news portals, dailies and TV channels.

These reports alleged the company's involvement in corruption during the procurement of Covid-19 vaccines.

The company rejected these "baseless" allegations and protested the "sensationalised and slanderous headlines, that not only tarnished corporate reputation as a globally known pharmaceutical manufacturer and exporter but also confused thousands of its valued shareholders, especially many foreign investors who currently hold more than 32% of company's shares."

The pharmaceutical company said, "The allegations that came out in the media are entirely baseless, distorted, and part of a smear campaign. Beximco Pharma reserves the right to take appropriate legal action against such defamatory reporting as it hampers Company's reputation."

The company urged the media to exercise responsibility professionally and verify facts before publishing.

Beximco Pharma explained they were involved with the procurement of 1.5 crore doses of Oxford/AstraZeneca vaccine (Covishield) from Serum Institute of India, the world's largest vaccine producer, costing Tk480 crore and Beximco Pharma received $1 per dose totalling Tk120 crore for supplying the same.

"Thus, the total cost incurred for 15 million Covishield doses stood at Tk600 crore while several media and news portals clearly attempted to malign Beximco Pharma with headlines, saying the company is being investigated for Tk22,000 crore corruption in connection to Covid-19 vaccine purchase," reads the statement.

The reports claimed that The Anti-Corruption Commission (ACC) has decided to launch an inquiry against a syndicate involving Salman F Rahman, Beximco Pharma and others over alleged embezzlement of Tk22,000 crore government funds during the Covid-19 vaccine procurement process. It further alleged that the government bypassed competitive bidding and negotiations by pursuing a single source for vaccine procurement.

Company's response

During the Covid-19 pandemic, wealthy nations had pre-booked nearly all available vaccine doses, leaving low and middle-income countries like Bangladesh in a precarious position. The Bangladesh government made desperate efforts to secure vaccine doses from multiple sources, but the global situation was very complex, and no manufacturer could guarantee doses. 

Recognising the urgency, Beximco Pharma focused on the AstraZeneca vaccine (Covishield), which showed early promise in trial, did not require ultra-cold storage like Pfizer or Moderna vaccines, and was presumed to be relatively cheaper as this was being developed by Oxford University. 

Beximco Pharma started negotiations with SII, the world's largest vaccine producer and authorised manufacturer of Covishield. In August 2020, Beximco Pharma and SII agreed to cooperate on Covid-19 vaccine, Beximco Pharma being the exclusive distributor for Bangladesh to facilitate the needs of the Bangladesh government. 

Despite all out efforts from government and private sector, there was a serious shortage of vaccine doses, and no potential vaccine manufacturer could commit any dose to anyone. Bangladesh received the first consignment of 5 million Covishield doses on 25 January 2021. Mass vaccinations began on 7 February 2021, ahead of many developed countries. This achievement was made possible by Beximco Pharma's professionalism, global reputation, and relentless efforts.

Allegations

The reports also claimed that government procurement rules were not followed in the vaccine purchase agreement between the government, Beximco Pharma, and SII. Beximco Pharma was included as a third party without a valid reason, leading Bangladesh to purchase the vaccine at a higher price than other countries.

Company's response

Despite repeated requests, SII was unwilling to deal with the government directly because of their inability to perform regulatory formalities in Bangladesh and to avoid bureaucratic delays. Also, the government does not purchase directly from overseas manufacturers. Such requirements are always met by dealing with a credible entity or organisation. Beximco Pharma acted as a responsible intermediary, ensuring delivery and distribution of vaccines.

Allegations

The complaint further claimed that if the government had procured the vaccine directly from the Serum Institute, the savings per dose could have been used to secure an additional 6.8 million doses.

Company's response

The vaccine purchase agreement (available for viewing at https://beximco-pharma.com/cdn/bpl/bdesh-signed-purchase-agreementdt.18....) was signed on 13 December 2020 with the vaccine price settled at $4 (four) per dose. There was an exceptional clause in the agreement saying if SII sells the vaccine at a lower price in India, Bangladesh would pay the lower price, and if the Indian price is higher, Bangladesh would still pay $4 (four) per dose.  

Although the supply agreement was done for a total of 3 crore doses, SII eventually delivered 1.5 crore doses costing $60 million (Tk480 crore). Beximco Pharma received $1 per dose totaling $15 million (TK120 crore) for supply of 1.5 crore doses. Thus, the total cost incurred for 1.5 crore Covishield doses stood at Tk600 crore while several media and news portals clearly attempted to malign Beximco Pharma with headlines saying the company is being investigated for Tk22,000 crore corruption in connection to Covid-19 vaccine purchase.

The $1 distribution service fee per dose was given to Beximco Pharma for rendering its services that included completion of all regulatory formalities, importation, storage, and distribution of vaccines nationwide strictly maintaining cold chain in every step. This also included risk coverage during transportation (damage due to mishandling, temperature fluctuations during storage etc.). Beximco Pharma also took full financial liabilities in the absence of the insurance coverage. This service fee was very much in compliance with local regulatory authority (DGDA) norms for imported medicines.

With a total cost of $5 (Tk400) per dose, this was the lowest price paid by the Bangladesh Government for any Covid-19 vaccine. Beyond the agreement terms, Beximco Pharma also supported the government by storing and distributing nationwide an additional 32 million doses of Pfizer, Moderna, Sinopharm, Sinovac vaccines, absolutely free of any charge. 

For its outstanding role in combating the pandemic, Beximco Pharma won the highly prestigious CPhI Pharma Awards 2020 in the category of "Innovation in Response to Covid-19" competing against top pharma companies from around the world. While such a remarkable accomplishment truly represented Bangladesh and its pharma industry to the world, especially for its positive role during the unprecedented humanitarian crisis, it's really heartbreaking to see Beximco Pharma has now become a target of malicious media trials in its own country.

The statement reads, "Beximco Pharma firmly asserts that it conducted all transactions with necessary approvals from the regulatory authorities. As a company listed on the AIM of London Stock Exchange, Beximco Pharma maintains full transparency in its operational and financial disclosures.

"The company has never been involved in any corruption, rather it has been making significant contributions to the economy being the largest exporter of medicines in the country with a global footprint in more than 60 countries and winning the National Export Trophy (Gold) a record nine times."