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Post: Pandemic Procurement Controversy: Canadian Government Favors Costlier Imported Rapid Tests Over Domestic Options
During the pandemic, the Canadian government favored Chinese imports for billion-dollar rapid-test contracts, overlooking more affordable Canadian-made options, as revealed by a Global News investigation. The contracts, some of the largest for medical supplies during the pandemic, were awarded to BTNX and Switch Health, Toronto-area suppliers, who were part of an exclusive federal program, despite offering higher prices than domestic manufacturers. BTNX landed a contract worth around $2 billion, and Switch Health’s contracts totaled approximately $365 million, both as participants in the Accelerated Growth Service (AGS), a program aimed at transforming small businesses into global players by facilitating connections with government officials at all levels.
BTNX’s pricing for a test kit from a Chinese manufacturer was 85 cents more than a Canadian option, resulting in the government ordering 404 million tests, the pandemic’s most significant federal medical supply deal. Switch Health’s kits, from a South Korean maker, were priced between $6.45 to $10 more than the lowest Canadian option, leading to an order of 60 million tests, the fifth-largest deal. Despite Switch Health’s denial of the accuracy of this pricing data, they did not elaborate further.
The preference for imports over local production led to an additional cost of over $56 million to taxpayers and significant layoffs at Canadian manufacturers like Artron and bioLytical Laboratories, which had to dismiss 630 workers due to the inundation of the market with free imported tests, despite having received federal funding to develop and upscale their COVID-19 rapid tests.
Artron’s CEO, Cenk Ozkan, questioned the lack of orders from the government for their higher-performing, better-priced Canadian products, especially given the federal investment in their capacity building. The investigation also uncovered that BTNX had omitted data in a Health Canada application, a claim they deny, maintaining their integrity and compliance with regulatory standards. Despite these controversies, the federal government’s procurement strategy remains under scrutiny for lack of transparency and fairness, particularly regarding the AGS program’s role in contract awards.
The situation has sparked calls for an independent inquiry into pandemic spending, highlighting concerns over governmental accountability, transparency, and the potential favoritism in the procurement process.
COVID: Questions about BTNX rapid test supplier’s Canadian production
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About the Author: Bernard Aybout (Virii8)
