Motsoaledi defends R15 billion ARV tender, says process followed procurement rules

Health Minister Aaron Motsoaledi has defended the process that led to the award of a R15 billion anti-retroviral (ARV) tender, saying the department found no procurement failures or material irregularities arising from the evaluation and award.

Minister says evaluation followed procurement prescripts

Motsoaledi told reporters the department applied a comprehensive due diligence and evaluation process in line with applicable procurement prescripts, including the Public Finance Management Act, the Preferential Procurement Framework Act, the Special Requirements and Conditions of Contract and the bid specifications issued for the tender.

“In this regard, the department relies on information submitted by bidders in good faith at the evaluation stage, supported by documentary evidence as required in the bid documentation.”

He added that the department is not aware of any procurement failures or material irregularities arising from the evaluation and award process, which was conducted in accordance with the applicable legal and regulatory framework.

Response came after parliamentary questions

Motsoaledi was responding to parliamentary questions from EFF MP Naledi Chirwa-Mpungose, who had raised public concern about alleged discrepancies, irregularities and possible procurement failures around the tender.

Chirwa-Mpungose had asked what due diligence the department implemented during the awarding process and requested the names of companies awarded contracts.

How awards were made, and who won

The minister explained that pharmaceutical tenders include multiple line items covering different medicines, formulations and pack sizes. Bidders may submit offers for one or more line items, and awards are made item-by-item after evaluating the bids for each item.

Motsoaledi said first-line Tenofovir/Lamivudine/Dolutegravir (TLD) tablets were the highest-volume products and attracted strong competition, with multiple bidders submitting offers. He noted that while Hetero Drugs SA and Cipla Medpro Manufacturing were not awarded contracts for TLD following evaluation, both companies were successful for other line items and received contract awards under the tender.

The tender was awarded to 11 successful bidders in accordance with the evaluation outcomes and applicable procurement processes. Those bidders were listed as:

• Aurobindo Pharma
• Barrs Pharmaceuticals Industries
• Cipla Medpro Manufacturing
• Emcure Pharmaceuticals SA
• Hetero Drugs SA
• Innovata Pharmaceuticals
• Macleods Pharmaceuticals SA
• Pharma Dynamics
• Pharmacare Limited
• Sonke Pharmaceuticals
• Viatris Healthcare

Calls for investigation and company financial concerns

About five months earlier Motsoaledi had challenged the Health Portfolio Committee to take a resolution recommending the Special Investigating Unit (SIU) probe the ARV tender, after Chirwa-Mpungose alleged a corruption ploy at a political level in the award of the contract.

Chirwa-Mpungose had singled out the awards to Barrs Pharmaceuticals Industries and Innovata Pharmaceuticals, noting both companies were placed under business rescue in December 2025 and raising questions about their financial capacity to hold the contracts.

Motsoaledi said due diligence was assured during bid evaluation by assessing bidders against the requirements specified in the tender conditions. He said the department did not examine balance sheets or other financial statements because that would require outsourcing to audit companies and be costly.

The department’s chief financial officer, Phashwa Mamogale, told reporters that all bidding requirements were met by the companies when the tender was awarded. Mamogale said the directors of the two companies had separate directorships and that the tender requirements did not require a review of the companies’ finances. He added that when the companies were selected, the department was not aware of the financial difficulties they would later face.

What the department emphasised

The department emphasised reliance on documentary evidence submitted by bidders during evaluation and that awards were made in line with the legal and regulatory framework governing public procurement.