Procurement of Drugs
Procurement of Drugs



Sh. Harish Kumar Lalwani

Phone No - 9828151932

Email - 


Drug Procurement Policy


A.Old Scenario :


As per the Old Drug Procurement Policy 1988, the Pharma Public Sector Undertakings (PSU’s) registered under the Ministry of Indian Petrochemicals and Fertilizer were given purchase preference up to 100%, for medicines manufactured by them. Small scales Industries (SSI) of the purchasing state were given purchase preference up to 80%, provided, they match the L-1 rates.

The Stores Purchase Organization under Medical and Health Directorate was doing the Rate Contract for Medicines, consumables, equipments and instruments. Out of these, the Rate Contracts of very few items (Approximate 30%) was possible. The facility of procurement was decentralized and the purchase orders were given by various Department Heads and purchase officers (PMO/CMHO/CHC in-charge etc). Due to lengthy processes in the Rate Contracts, more time, efforts and money were spent. In the this  system, there was no provision for Annual Maintenance Contract and Comprehensive Maintenance Contract for all equipments. The facility of logistics and distribution was not inbuilt in the system; there is need for computerization and improvement in Quality Control System. There was a shortfall in the system in assessing the medicine requirement, consistency in sample verification and Medicine Stores management.


B.New Policy :


In order to have efficient management to overcome all these shortcomings, Rajasthan Medical Services Corporation Limited has been established and procurement policy has also been modified.


Under new policy, procurement of Drugs, Surgicals & Sutures are to be made by Competitive Bidding. Purchase preference is now restricted to 25% only, out of which 10% for state PSU’s and 15% for state SSI’s, that too on condition that it would be necessary for them to match with the L1 rates obtained through tendering.


The following technical and managerial improvements are envisaged with modified drug procurement policy which is to be enforced through RMSC :-


  • The procurement of medicines at lowest rates could be ensured due to the centralized bulk purchase. As the rates received would be much lower, this will result in additional availability of drugs, equipments and instruments. Due to streamlined procedure, the State Government will save on time and money.
  • As a comprehensive quality control mechanism has been incorporated therefore procurement of good quality medicines would be ensured.
  • It will be possible to build capacities for procurement through Competitive Bidding in Government under the Corporation.
  • Due to computerization of entire operations, it will be possible to get the timely information on the expected expiries of the medicines and stocks which are likely to be expired soon will be utilized on priority and will be shifted to some other places according to the requirement.
  • It will be possible to ensure an efficient management of drug distribution system in the State.
  • For the annual maintenance of equipments, a system of Annual Maintenance Contracts and Comprehensive Maintenance Contracts would be established.
  • It will be possible to ensure transparency and the competitiveness in the entire procurement system.


Rmsc Procurement List

The corporation has its own List of Drugs, Surgical & Sutures. It has been prepared after taking in to consideration the need of State. However NLEM, RSEML, and EDL of WHO have also been considered. Further the EDL of TNMSC, KSMSC,  Delhi  and Karnataka etc have also been considered for

The drug List of RMSC is based on principles of:

  1. Efficacy
  2. Safety
  3. Suitability
  4. Cost effectiveness

It may be revised from time to time by RMSC in consultation with its T.A.C. and end users.


All Medical officers of the state health facilities are expected to prescribe drugs by their Pharmacopoeial / Generic names in OPD as well as for IPD patients & the drugs will be prescribed from this list only as for as possible.


The specifications of drugs proposed to be procured will be decided in consultation with Technical Advisory Committee of RMSC. The Corporation will decide on the quantity to be procured from the essential drug list. It will be based on the requirements as ascertained from all state controlled health facilities.


Invitation Of Tenders 


Tenders will be invited after adequate publicity through State and national level news papers and by displaying all NITs on the official website of Medical Department of the state. If required, the information regarding tenders will also be circulated through State Drug Controllers, Pharma Manufacturing Associations and Pharma Publications to encourage more participation in the tender. The tenders will be received and finalized as per the conditions of tender document. The entire tendering system will be based on two bid system i.e. technical and financial bid separately.


After public opening of tenders the technical bid will be evaluated first on the basis of evaluation criteria prescribed in the tender document. A list of technically qualified bidders will be prepared. It will be announced and displayed on the website of Medical and Health Department. Subsequently, price bids of all technically qualified bidders will be opened in the presence of bidders. Finally the rates quoted in the financial bids will be compared and contracts would be awarded to lowest evaluated and responsive bidders. The negotiations, if required would be done in exceptional cases and that too as per the provisions of rules.


The manufacturing premises of the tenderers participating in the RMSC tender may be inspected for the compliance of Good Manufacturing Practices, Good Laboratory Practices and for verification of their production capacity. In such cases, Inspection team will be constituted from  the officials of Drug Control Department Corporation and end-user departments.


 After finalization of the L-1 rates, these rates and the list of tenderers will be placed before the Purchase Committee of the Corporation for verification and approval.


After Purchase Committee approval, letters will be issued to the L-1 tenderers for execution of agreements and deposit of Security amount.


Subsequently, letters will also be issued to the L-2 & L-3 tenderers who participate in the tender and request them to send their willingness for matching the L1 rate. The tenderers will also be requested to indicate the matched items in the schedule of the agreement. The matched suppliers will be kept as reserve, in case of any additional requirement and in case of exigency; orders will be issued to the matchedtenderers.


If any item is not approved by the Purchase Committee for any reason, the tenders will be invited again and will be considered afresh.


Purchase Preference


In conformity with the Govt. Policy, purchase preference up to 15% to S.S.I. units of Rajasthan shall be given if they match the L1 rates.

Purchase preference up to 10% shall also be given to P.S.U.’s of  Rajasthan   State  subject to matching the L1 rates.

Minimum turnover criteria & other criteria will be decided by TAC & Board of RMSC to ensure procurement of quality drugs. 


Procurement Of Drugs


The purchase orders of drugs and surgical items will be placed twice a year, in general. The frequency schedule may be altered as per need.


RMSC shall have 4 months physical stocks in its Warehouses and 2 months stocks in pipeline for all the drugs. The Purchase order quantity will be arrived at by taking into account the requirements by the end users.


After the approval of the Managing Director, the purchase orders will be placed by procurement wing of RMSCL and sent to the Suppliers through E-mail and hard copy by courier. The stocks in the warehouses and their utilizations shall be closely watched on day to day basis by the Logistic wing.


After receipt of Purchase Orders the suppliers will be required to upload the confirmation of receipt of the Purchase order within 3 days from the date of placing the order. The suppliers would also have to intimate the schedule of supply by e-mail or Fax within 7 days from the date of receipt of the order so as to have a better plan of action on the movement of drugs.


The supply, if phased, has to be completed by the supplier in accordance with the conditions of tender. The shelf life of drugs should not  be less that ¾ th as prescribed under Schedule-P of Drugs & Cosmetics Rules 1945.


In case of any drug for which the consumption has been reduced in a particular area and if the drug is not required by them, such drugs will be transferred to another warehouse in the identified area with more utilization. By this methodology, the expiry of the drugs in the warehouses would be avoided.


The same way, in the case of any excess issue of the drugs from a warehouses, things shall be taken care of. In case of any epidemic situation, the requirements will be met out immediately by making inter warehouse transfers.

As soon as the drugs are received in the warehouses from the suppliers, the corrugated boxes will be numbered and same will be fed into the computer system. Samples will be drawn randomly from the supplies from each batch. The samples drawn will be sent to the Quality Control department in the Head office.

After the samples are received in the Head office from all the warehouses, common batch of an item will be mixed and sample shall be drawn from pooled batch. Steps will be taken to remove / hide the identity of the manufacturer and encode the formulations secretly. The formulations / items assigned secrete codes will be sent to Empanelled Laboratories for analysis.


The Empanelled Laboratories would analyse the drugs as per specifications; and suitable test protocols. Upon receipt of reports from the Empanelled laboratories, the results will be sent to the warehouses through E-mail, besides other methods.


If any sample sent to the Empanelled laboratories fails in quality, the result will be confirmed with the other Empanelled laboratories/ Government Analyst before taking final decision.


If the drug fails in assay or any other parameters, action shall be taken by the Q.C. Department immediately; the stock would be frozen and removed from the main stock and kept separately until it is cleared by the Quality Control department. If the Empanelled Laboratories/ Government Analyst confirm the failure of the drug to meet the standards, steps will be taken to return the stocks to the supplier. After 30 days of the letter for return of stocks, if the stocks are not taken by the Supplier and lying in the warehouses, penalty of 2% per week will be levied on the value of stocks in the warehouse till it is destroyed by RMSC (90 days).


In the case where statutory sample drawn by a Drug Control Officer from user storage point (hospital) is declared substandard by the Government Analyst, the issue of the product shall be stopped immediately and the drug supplied shall be recalled from the hospital. The Warehouse in-charge will intimate every institution where the batch has been supplied, for retrieval of the drugs.  Total value of the quantity supplied by the supplier will be deducted from their bills. Depending on the nature and extent of non-conformance of the product, decision to blacklist the product/ Company will be taken after following due procedure.


The State Drugs Controller shall also be informed about the drug declared of Not of Standard Quality so that appropriate action may be taken to ensure the quality of drugs of the manufacturer in question.


The stability of the drugs during storage period in the warehouses shall also be checked from time to time by drawing samples and getting the drugs analyzed.


Vaccines & Serums


The supply of vaccines and serums shall be allowed to be distributed to the hospitals as per the clearance from CRI, Kausuli. In addition to this, samples of the Vaccines may be drawn from the warehouses randomly and sent to the CRI for analysis.


In case of any adverse reactions reported in the Hospitals during administration due to any Vaccines, Serums or any Injectables, immediate action will be taken to stop the distribution of the drug and retrieve all the stocks from the Hospitals.


First Appellate Authority for Tenders