Health Minister Aaron Motsoaledi stated that his department has no information regarding any procurement failures or significant irregularities that arose during the evaluation and awarding process of the tender for antiretroviral drugs (ARV).
Tender Process
Motsoaledi refuted the suggestion of irregularities in the awarding of the R15 million antiretroviral drug tender. He emphasized that the department utilized comprehensive due diligence checks and an evaluation process that complied with applicable regulations, including the Public Finance Management Act, the Preferential Procurement Policy Framework Act, Special Terms and Conditions of the Contract, and the technical specifications issued for this tender.
He noted that the department relies on information provided by bidders in good faith during the evaluation stage, and this information is supported by documentary evidence required in the tender documentation. Therefore, the department is unaware of any procurement failures or significant irregularities, as the entire process was conducted in accordance with the existing legal and regulatory framework.
Response to Parliamentary Questions
Motsoaledi responded to questions from Parliament by EFF Deputy Naledi Chirwa-Mpungose, who raised widespread public concern regarding alleged discrepancies, irregularities, and potential failures in the R15 billion antiretroviral drug tender. Chirwa-Mpungose requested information on the due diligence conducted by the Motsoaledi department during the award of the said tender, as well as the names of the companies that received the contracts.
In response, Motsoaledi explained that pharmaceutical tenders include numerous individual items covering various medications, formulations, and package sizes. He clarified that bidders have the right to apply for one or more items, and contract awards are made for each item after evaluating the submitted applications.
Competition and Tender Winners
The Minister reported that within the ARV tender, first-line tablet products Tenofovir/Lamivudine/Dolutegravir (TLD) represented the highest volume and faced particularly strong competition due to the large number of bids submitted. He added that although Hetero Drugs SA and Cipla Medpro Manufacturing did not receive contracts for TLD after evaluation, both companies successfully passed selection for other items they bid on and consequently secured contracts within the tender.
Overall, the tender was awarded to 11 successful bidders in line with the evaluation results and applicable procurement procedures. These companies are 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, and Viatris Healthcare.
Corruption Allegations
Five months ago, Motsoaledi approached the Health Portfolio Committee requesting a resolution recommending that the Special Investigating Unit (SIU) investigate the ARV tender. This followed Chirwa-Mpungose's assertion of another political corruption scheme related to the tender award. She insisted that the SIU investigate due to numerous red flags, noting the awarding of the tender to Barrs Pharmaceuticals Industries and Innovata Pharmaceuticals, both of which were in financial distress in December 2025.
Chirwa-Mpungose claimed that these two companies, subsidiaries of Avacare Health, received the tender despite lacking financial solvency. She also pointed out that the Public Finance Management Act requires companies participating in government contracts to demonstrate financial stability, which these two firms lacked.
CFO's Position
Motsoaledi had previously stated that due diligence was ensured during the application evaluation process by checking all participants against the requirements specified in the tender conditions. He also mentioned that the department did not review balance sheets or other financial documents because doing so would require engaging external auditing firms, which would be extremely costly. Chief Financial Officer Phasha Mamogale stated that all application requirements were met by the companies at the time of the tender award. Mamogale added that the directors of the two companies held separate executive positions, and the ARV contract tender requirements did not mandate a check of the companies' financial health. Furthermore, he noted that at the time of selecting the companies, the department was unaware of the financial difficulties they would face.