The National Insurance Property Development Company Limited (NIPDEC) has disposed of an estimated $80 million worth of expired pharmaceuticals between 2020 and 2025.
The startling figure was revealed by Health Minister Dr Lackram Bodoe during yesterday's Mid-Year Budget Debate in Parliament. He said he requested a report from NIPDEC outlining the book value of both pharmaceuticals and non-pharmaceuticals discarded over the period.
“It speaks to a big problem here in terms of supply chain management and so on. And why, in fact, so many drugs, such a high value, have to be disposed of.”
While alarmed at what he called a waste, Bodoe said he was equally shocked by the high rent being paid to store the expired items. He noted that a portion of NIPDEC’s warehouse currently houses both expired and active stock, with a monthly rental fee of $123,758 paid directly to the company which owns the facility.
He added that while some of the justifications provided were consistent with industry standards, the situation exposed systemic failures.
“It pointed to the lack of an integrated inventory management system by NIPDEC across the public health sector and that would have limited the ability to optimise inventory, utilisation and minimise expirations. It shows that there has been an ongoing problem which has not been fixed in the last 10 years and, Mr Speaker. This government gives the assurance that that is something we are going to look at in terms of fixing the supply chain issues.”
Bodoe said reform is both necessary and forthcoming.
He noted that the health sector was allocated the largest share in the mid-year review, $728.5 million, but clarified that the funding would not resolve all outstanding debts or fully improve public health services.
“The fact is that some $688.3 million of this sum is needed to pay outstanding bills to NIPDEC and the various RHAs for goods and services already consumed. But I just want to give the assurance to the population that despite this we will deliver on our promises in the health sector.”
He also defended the request for an additional $353.7 million (as part of the $728.5M), saying it would go toward payments for the current financial year as well as overdue invoices for pharmaceuticals and non-pharmaceuticals as he underscored the impact of drug shortages on healthcare delivery.
“Pharmaceuticals are the lubricants that keep the engine of the healthcare system running and the knots and bolts that keep it from collapsing.”
He said diagnostic work and surgeries are often delayed or cancelled due to supply gaps, a key failure he wants to address.
“What happens? You have more sick patients, you have longer waiting times for surgeries.”
He warned that failure to pay suppliers would only worsen the situation, citing a letter from NIPDEC to the Ministry of Health’s Permanent Secretary which flagged $623,623,540.62 in unpaid balances as of January 31, 2025.
Bodoe also revealed a declining trend in drug expenditure from the Consolidated Fund:
2015 – $617.2M
2016 – $507.4M
2017 – $531.6M
2018 – $498M
2019 – $573M
2020 – $148M
2021 – $255M
2022 – $251M
2023 – $372M
He accused the former administration of masking the drop in government spending with loan financing.
According to the minister, six loan agreements totalling nearly $2 billion were secured between 2020 and 2023 to ensure NIPDEC had funds to purchase drugs, a move he said explains the frequent shortages under the last government.
As for the Chronic Disease Assistance Programme (CDAP), he said a committee has been established to review and expand the drug list and improve its benefits to citizens.
Meanwhile, the RHAs currently require $288 million to cover outstanding debts. Bodoe said the South-West Regional Health Authority (SWRHA) had to outsource waste removal due to a non-functioning incinerator. He revealed that it now costs $32,000 to dispose of human remains.
A private company is being paid $365,000 for related services.
An autoclave is operational but highly expensive.
A generator rented at $63,000 per month has so far cost taxpayers over $1.5 million.
“This is certainly an issue here of poor governance, possibly corruption and definitely mismanagement.”
Bodoe also revealed that the main hospital at the San Fernando General Hospital had its roof refurbished for $5.5 million, but the structure is now infested with termites due to poor engineering.
He noted that the medical oxygen generator plant at SWRHA has been nonfunctional since 2022, forcing the purchase of oxygen at $225,000 per month, or $1.5 million per year. In comparison, repairing the plant would cost just $500,000.
On service hours, Bodoe said that only six health centres are currently operating with extended hours, down from 41 under the People’s Partnership. However, he said the government will increase that number by six and standardise opening hours from 4 to 8 Monday to Friday, and 8 to 4 on weekends.
Additionally, 36 new doctor positions will be created to help meet service demand.