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Petitioner: Messrs GETZ PHARMA (PVT.) LIMITED through Authorised Person VS Respondent: PROVINCE OF SINDH through Chief Secretary, Government of Sindh and 7 others
Court Name: Sindh High Court Judge(s): Muhammad Shafi Siddiqui Title:Messrs GETZ PHARMA (PVT.) LIMITED through Authorised Person vs
PROVINCE OF SINDH through Chief Secretary, Government of Sindh and 7 others Case No.: Suit No,.62 and C.M.A. No,543 of 2015 Date of Judgment:2015-03-26 Reported As: PLD 2016 Sindh 479 Result: Application allowed Judgment ORDER ' MOHAMMAD SHAFI SIDDIQUI, J.--Through these proceedings the plaintiff has challenged the transparency of the tender process initiated by defendant No,4 for supply of medicines, vaccines, machinery, equipment etc. For prevention and/or control of Hepatitis B & C in Sindh for the year 2014 and 2015 and through the listed application under Order XXXIX, Rules 1 and 2, C.P.C. The plaintiff has prayed for restraining orders till final disposal of the suit to the effect that the defendants Nos.1 to 4 be restrained from implementing the subject tender for procurement of Hepatitis B and C medicines and defendants Nos.5 and 8 from supplying their medicines/drugs in respect thereof. ' Learned counsel for the plaintiff in support of the application has contended that initially the subject tender process was advertised through newspapers of dated 28.11.2014 and 29.11.2014 however through a corrigendum issued in newspapers of 30.11.2014 the defendant No,4 extended the tender opening date to be 18.12.2014. The plaintiff also participated in the tender process through defendant No,6 A.J. Mirza Pharma (Pvt.) Limited. ' Learned counsel for the plaintiff submitted that after obtaining .Complete set of tender and its related documents, the documents were submitted which pertain to eligibility criteria as well as the evaluation criteria. The counsel contended that in terms of eligibility, the manufacturer must have ISO certificate and either Good Manufacturing Practices (GMP) or Food and Drug Administration (FDA) (USA approved). The evaluation criteria are stated to be based on 22 points. The plaintiff through defendant No,6 submitted the bid in relation to its products Unipeg and Ribazole, along with all the requirements as emphasized and needed for the subject tender. It is claimed by the
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learned counsel that since the plaintiff has made/fulfilled all the eligibility and evaluation criteria, therefore, both the products of the plaintiff were eligible and entitled to have a highest number of points in evaluation however through letter dated 26.12.2014 the defendant No,4 accepted the technical bid of defendant No,6 on behalf of the plaintiff in relation to its product Ribazole but the same was declined in relation to its product on approximately five points which are incorporated in remarks column of the said letter. ' It is contended by the learned counsel that none of the grounds, as alleged, to such rejection are applicable to the product in question i.e, Unipeg. In addition, the learned counsel submitted that the mala fide on behalf of the defendants is apparent as the rejection letter of 26.12.2014 contains reference to an order passed in C.P. No,D-6723 of 2014 on .30-12-2014. Thus it is claimed that it is inconceivable that the defendants came to know about the order of 30-12-2014 on 26-12-2014. According to the learned counsel it clearly smells mala fide, apart from the fact that indeed it was never refused on 26.12.2014. ' Learned counsel further, without prejudice to the above. Submitted that perusal of order of 30.12.2014 passed in the aforesaid petition clearly shows that it does not contain any direction for the defendants, particularly defendant No,4, to enforce and/or implement any additional condition to the eligibility criteria i.e, it should be only FDA/EMA approved. Furthermore, as against this product of plaintiff, the defendant No,5's bid through defendant No,7, for its product was accepted in relation to Unipeg and the bid of defendant No,8 has also been accepted in relation to its product Pegintron through defendant No,7. ' It is contended by the learned counsel that previously in the year 2013 and 2014 similar kind of tender was floated by defendants Nos.2 to 4 in relation to Inj: Pegylated Interferon Alfa2a and Alfa2b with Cap: Ribavirin 400 m.g. Wherein arbitrary and discriminatory conditions of FDA/EMA approval was incorporated, which led to the disqualification of the plaintiff and other similarly placed pharmaceutical companies. Prima facie this condition was imposed only to favour a single bidder i.e, defendant No,5 who could qualify such condition in respect of his previous medicine namely Pegasys. It is claimed that although such imposition of condition was challenged by the distributor of the plaintiff when he filed Petition No,D-3300 of 2013 however the same was dismissed on the ground that the principal/plaintiff/manufacturer did not itself challenge the impugned condition which order has been challenged by the Distributor before the Hon'ble Supreme Court and the same is pending adjudication wherein leave has been granted. It is urged that it is only on account of realization of imposition of such arbitrary and .Discriminatory condition that in the impugned tender, which is the subject matter of this suit, such conditions were not incorporated. ' While arguing the case insofar as the rejection of plaintiff's medicine Unipeg is concerned, it is urged that the acceptance of defendant No,5's bid is also illegal and mala fide as the very registration of defendant No,5's product is under challenge on account of being deceptive marketing practices as it is claimed in the advertisement and promotion that Ropegra i.e, Pegylated Interferon alfa-2a 180 mcg (40KD) is identical to Pegasys. Learned counsel submitted that there is a series of litigation between the plaintiff and defendant No,5 as they are business competitors and in pursuit thereof some mala fide proceedings were initiated by defendants through their front man when a Constitution Petition No,2891 of 2010 was instituted in relation to plaintiff's drug wherein he has filed certain documents which could not have been in his possession unless supported by defendant No,5. It is also contended that in those proceedings the respondents, including the Ministry of Health, Additional Secretary Health, Registration Board and Federal Drug Inspector have filed their comments and have denied the contention as raised in the petition against the present plaintiff by the petitioner in the said petition who is a front man of defendant No,5.
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' Thus, learned counsel submitted that rejection of the plaintiff's product in relation to Unipeg on the allegation that it does not have approval by FDA/EMA is illegal and mala fide as it is not the eligibility criteria in tender conditions and furthermore all other ancillary and co-related reasons for such rejection also do not borne out such conditions and that the self-claimed conditions, in terms of order of 30.12.2014 passed in C.P. No,6723 of 2014, are also not established. ' It is further contended by the learned counsel that the alleged disqualification of the plaintiff product on the pretext that the molecular , weight of Unipeg is 23 Kilo Daltons (KDa) is also mala fide as the drug of Schering Plough (defendant No,8) has been accepted in relation to its product Pegintron which is 12 KDa. It is contended that if at all a molecular weight of 20 KDa in relation to the medicine Unipeg is not recommended how the product of Schering-Plough defendant No,8 which carries 12 KDa can be accepted. It is contended by the learned counsel that such rejection on the basis of its molecular weight was otherwise made only to favour the product of defendant No,5 as the mala fides are prima facie established. ' It is urged that the plaintiff's product Unipeg has undergone all kinds of testing, which is established from various letters issued by the Centre for Applied Molecular Biology, Ministry of Science and Technology, Government of Pakistan, and on various occasions Government of Pakistan issued Lot Release Certificates from 07.07.2010 to 31.12.2014. Learned counsel submitted that this product is being exported to various countries such as Cambodia, Laos and Myanmar. Learned counsel has further added that the safety, reliability and effectiveness of plaintiff's products have also been approved by independent medical sources which are part of the record. ' Learned counsel for the aplaintiff in support of his contention has relied upon the cases as under:- i) Transparency in respect of tender process:- 2012 CLC 1780, PLD 2012 Sindh 434, 2013 CLC 476, 2012 SCMR 1651, PLD 2013 Islamabad 1651, PLD 2012 Lahore 503, PLD 2010 Lahore 289, PLD 2012 Balochistan 208, 2012 YLR 1426 and 2014 SCMR 676; ii) Change in tender condition:- 2007 YLR 161, 2010 CLC 1370 and PLD 2011 Lahore 16; iii) Discrimination as against Pakistani products:- PLD 2020, SC 759(sic); iv) Injunction and damages: - PLD 1982 Lahore 49, 1993 MLD 1308 and 2008 YLR 2040; v) Laches: - AIR 1994 Delhi 322 and 2013 MLD 433; vi) Ouster clauses:- PLD 2005 SC 873, 1974 SCMR 356, 2007 SCMR 554, PLD 1994 SC 738, 2000 SCMR 1137, 1999 YLR 166, PLD 2000 Kar. 16, 1999 PTD 1310 and PLD 1997 SC 3; vii) Mala fides: - PLD 2014 SC 47 and PLD '1973 SC 49; viii) Alternate remedy:- 2001 CLC 1618; ix) Undertaking and Court order: - 1997 SCMR 193; x) Expert opinion:- AIR 1931 Lahore 364, 2001 YLR 749, 1989 MLD 3325, 1996 MLD 762 and 2004 SCMR 1859; xi) Court's role in-assigning medicine quality:- 1992 MLD 481, 2003 YLR 3056, PLD 2003 Lahore 115 and xii) Substandard drug and jurisdiction of Drug Court:- 2002 PTD 1800. ' Mr. Qazi Majid, learned AAG appearing for defendants Nos.1 .To 4, at the very outset contended that although this condition of FDA/EMA approved medicines was not the condition prescribed for the bidders to be qualified however in all previous tenders such evaluation in relation to FDA/EMA was a condition precedent and further the orders passed in C.P. No,6723 of 2014 also confirms that no such medicines, which are in violation of FDA/EMA, could be approved. ' Learned AAG further added that this parameter, insofar as the approval of the FDA/EMA is concerned, is internationally reliable as it confirms the safety and efficacy of the medicine. He further added that in terms of molecular weight of plaintiff's medicine, the committee has decided that its efficacy is not up to the mark. ' Learned AAG further added that as far as reports of Unipeg is concerned it is not published at as great extent as compared to Ropegra (Pegasys). He argued that drug of defendant No,8, which
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contains molecular weight of 12 KDa, as it is recommended for children and under-weight patients. ' He further submitted that the plaintiff's bid was rejected on 26.12.2014 which was dispatched in the afternoon of 30.12.2014 through TCS and this suit has been filed after delay of 16 days and as such the balance of inconvenience would not be in favour of the plaintiff. ' Mr. Haider Ali, learned counsel for defendant No,5, contended that the plaintiff is not a bidder in the impugned bidding process for the procurement of Hepatitis B and C medicines and hence the plaintiff has no legal status to maintain the suit. He further submitted that it involves lapse/laches of 16 days and as such the plaintiff is not entitled for any relief on this score alone as during this 16 days the contract of supply was awarded. ' It is further contended that the plaintiff is suppliers of spurious Peg-2A and its own manufacturer and exporter has stated it to be not fit 'for human therapy and that the specification of 20 KDa in respect of plaintiff's drug has no international testing or study. It is further argued that the plaintiff does not have a license/letter of registration to conduct any form of manufacture of its registered product Unipeg and they are only allowed to import and fill the products in vials. It is argued that whether or not the plaintiff's drug met the evaluation criteria is a question that can be answered by Government of Sindh. ' It is further argued that one of the aggrieved bidder for the year 2014-2015 tender process initiated proceedings by filing C.P. No,D-6723 of 2014 and one of the preliminary objection therein was that the tender process of the Government of Sindh for 2014-2015 was tainted as the standard to meet the quality of the drug \Was reduced as compared to the previous evaluation criteria. The said petition was dismissed on 30.12.2014 upon the guarantee and undertaking of defendant No,2 that all drugs procured by the Government of Sindh for 2014-2015 tender for Hepatitis B and C would be of international standards and WHO, FDA and EMA approved and hence the Government of Sindh was bound by the undertaking given to the Court. It is further argued that defendant No,7 has informed defendant No,5 that it received letter of the Government accepting its bid on 02.01.2015 and also that defendant No,6 was present in meetings of 18th, 26th and 31st of December, 2014 and the presence of defendant No,6 was marked in the government record. ' Learned counsel further contended that the government expert Dr. Bhika Ram and Dr. Badar Fayyaz Zuberi objected to the Unipeg on the ground as available to the rejection letter. Learned counsel also denied that Unipeg is certified by WHO as Annexure A/2 merely provide the list of WHO pre-qualified quality control laboratories. He argued that on the contrary Ropegra is EMA approved and such approval is a public document and is available on website. ' Learned counsel further added that the word "international standard" as incorporated in order referred above means standard without any dispute. He contended that the impugned letter dated 26.12.2014 does not at all smell mala fide as it provided a plausible reason for rejecting bid of the plaintiff in respect of Uni peg. He further argued that if any one of the four reasons is correct then it should be held correct and the other incorrect decisions, if at all they are, does not come in the way of one correct decision. He asserted that in the instant case all the reasons assigned are correct. Learned counsel has also taken me to various definitions provided under the Rules called Drug License and Regulatory Rules, 1996 such as bulk product, manufacturer, goods manufacture practices and rules 2(j),(d),(s)(t) etc. ' Learned counsel further added that defendant No,5 in fact is the original manufacturer of Pegasys Peginterferon Alpha 2a having molecule weight of 40 KDa and hence they have their patent registered. It is for this reason that the plaintiff neither can nor has any sort of approval from EMA/FDA ' He contended that insofar as drug of defendant No,8 Le. Alfa2b with 12 KDa is concerned it is a separate drug. He added that the pretrial discovery proceedings available at pages 373 and 405 would come in the way insofar as the efficacy is concerned and the decree obtained in pursuance
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thereof is a collusive. He further added that the certificate of Goods Manufacturing Practices (Page 277 Part I) does not show that the Pegylated Interferon is manufactured by the plaintiff. ' Insofar as the issue of Anti-Dumping Duty is concerned, learned counsel submitted that if the sale price in the country of import is lower than the price of country of origin, the country of import imposes Anti-Dumping Duty. Although they dispute such imposition but without prejudice in view of the orders of the Regulatory Authority as well as Court the defendant No,5 was coerced to reduce such prices. However, in order to overcome such issue, defendant No,5 has now registered the same drug under the name and style of "Ropegra". Learned counsel has also relied upon Sections 15 and 16 of Sale of Goods Act on the ground that the plaintiff's goods are not sellable as they are not fit for human therapy as their efficacy is questioned, therefore, the plaintiff's bid also stands disapproved on this score as well. ' Learned counsel for defendant No,5 in support of his contentions has relied upon the cases reported in PLD 1976 Lahore 580, 2012 CLC 1409, 2011 SCMR 1360, PLD 1969 SC 65, 2000 YLR 469, 2001 CLC 781, 2005 SCMR 564, 2009 SCMR 385, 2010 YLR 1161, PLD 1974 SC 151, 2002 SCMR 549, PLD 1964 W.P. Karachi 608, PLD 1970 Karachi 125, 1992 CLC 1138, PLD 1965 W.P. Karachi 202, PLD 1973 Karachi 361, 2012 CLC 1434, 2010 CLD 1648, PLD 2012 Sindh 434, 2004 SCMR 1092, 1999 CLC 1719, 1982 CLC 2369, PLD 1965 SC 83, 2007 CLD 966, 2009 CLD 716, 2011 CLC 1985, PLD 2008 SC 472, 2013 CLC 476, 2002 CLD 231, PLD 1974 Karachi 29, 1988 CLC 779, 1989 CLC 75, 1995 CLC 952, 1997 SCMR 906, PLD 1955 Sindh 351, 1987 CLC 345, 2010 SCMR 121, PLD 1975 St 506, PLD 1966 SC 793, 2012 SCMR 455, PLD 1983 SC 151, 1994 SCMR 782, PLD 1992 SC 723, PLD 1971 SC 205, 1991 CLC 1277, PLD 2003 SC 344, 2010 CLC 285, 2011 MLD 925, 2007 MLD 2019, 2002 SCMR 1150, 2000 SCMR 1557, 2014 CLD 1410, 2014 CLD 1133, 2010 SCMR 286, 2010 SCMR 1811, 2010 SCMR 1861, PLD 1972 Karachi 119, PLD 1996 Karachi 365, PLD 2003 Karachi 691, 2003 CLC 1602 and 2013 MLD 1132. ' Mr. Abdul Sattar Pirzada, learned counsel appearing for defendant No,6, has also argued in line and in support of the contention of the plaintiff as being the agent of the plaintiff. He submitted that they have submitted the bid for the manufacturer and the bid documents, which provide the evaluation criteria as Point No,6. He submitted that the evaluation criteria is point-based system and the reasoning assigned in the rejection letter are devoid of the application of such evaluation criteria. Learned counsel for defendant No,6 further relied upon letter dated 15.12.2014 available at page 207 Part 1 which confirms that they are reputable manufacturer of Pegylated Interferon alfa- 2a 180 whereby they have authorized defendant No,6 to submit a bid, subsequently to follow up, negotiate and sign the contract on their behalf. Learned counsel submitted that in response to a technical specification of an earlier tender one of the dealers has filed a petition bearing No,D- 3300 of 2013 which was disposed of on 06.09.2013 on the ground that the petitioner who has filed the petition was not a manufacturer of the drug offered to respondent No,4 therein, whereas the actual manufacturer was M/s Getz Pharma, plaintiffs herein. It was observed in that case that the actual manufacturer has not come forward to question imposition of the conditions of the tender and that it was prerogative of purchaser to 'impose restrictions as it deemed fit and proper. Ultimately, the petition was disposed of on the ground that the plaintiff who is the actual manufacturer of the drug would have ben an appropriate party to deny such position but it chooses not to take any legal action. Hence, it was dismissed. However, it was left open to the manufacturer to establish before the concerned authority regarding efficacy of its product which is equivalent to the drug having been approved by FDA/EMA. Learned counsel submitted that it is this background that perhaps the manufacturer has filed this suit and its agent (defendant No,6) has been arrayed as one of the defendants. ' Learned counsel further relied upon the registration of the subject drug under section 7 of Drugs Act, 1976 and rules framed therein on 29.03.2010 and that certificate of Goods Manufacture Practices was also issued by DRAP which is available at page 277 which shows that they are
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authorized to export in terms of bullet point 1 thereof. Learned counsel further submitted that the laboratory of the plaintiff has been pre-qualified by WHO as Eastern Mediterranean Region. He has further relied upon Bio-Activity Potency test carried out by Centre for Applied Molecule Biology which concerned the subject drugs as of good quality and these drugs through an Award/contract by respective governments are being supplied to Balochistan, Azad Jammu and Kashmir and such purchase orders are available at pages 1177 etc. And other purchase orders of different renowned hospitals such as Mayo Hospital Lahore, Fatima Jinnah Medical College, Services Institute of Medical Sciences, Department of Gastroenterology, Liauqat National Hospital, Agha Khan Hospital, Ayub Teaching Hospital and other private institutes and doctors are available on record which are not denied. ' He submitted that in view of aforesaid facts and circumstances the undertaking given in C.P. No, D-6723 of 2014, as relied upon by other defendants, are ill-founded as such undertakings was not formed part of the order. ' He further relied upon attendance sheet available at pages 527 and 529 of the file and argued that such attendance sheet and the endorsement therein only show that the sealed bids were opened in their presence and the procedure adopted for opening such bids was transparent however it has nothing to do with the remarks as endorsed in the refusal note. ' Learned counsel further submitted that insofar as the counter-affidavit filed by defendant No,5 is concerned that is misleading as in Para 4 it is stated that the Government of Sindh for the year 2014-2015 tender invited the drugs of international standard and WHO/FDA/EMA approved and hence the government is also bound by the undertaking to re-examine each of the technical bid on such basis. He further contended that in Para 10 of the written synopsis filed on behalf of defendants Nos.1 to 4 they have stated that the bid was rejected on 26.12.2014 and the rejection letter was dispatched on 30.12.2014 which include the observation of the learned Division Bench. He further relied upon the clause 2 of Para 13 of the written synopsis wherein the defendants Nos.1 to 4 have admitted that the expertise of notified purchased committee announced that for Pegylated Interferon (mentioned in tender No,1) there is no criteria meant for technical evaluation and/or to adjudge and evaluate such an important life-saving drug. It is further highlighted that the first parameter that was considered was FDA and EMA approval followed by four phases which are also not tenable under the law. He further contended that the arguments were misconceived that there was no evaluation criteria as it is mentioned in the tender documents. He has argued that registration of Ropegra is also newly registered therefore it should not have been considered as compared to the plaintiff's product duly registered in the year 2010. It is claimed in Para 12 of the counter-affidavit that the Ropegra has been recently imported in Pakistan in January, 2014 and has been marketed and supplied since March, 2014 by defendant No,5. ' Learned counsel has also relied upon Rules 4, 13, 36 and 44 of Sindh Public Procurement Rules 2010 (hereinafter referred to as Rules 2010) and so also Rules 21 and 32 thereof and submitted that perusal of these rules and the amended rules would show that the refusal and decision declining to accept the bid of the plaintiff through defendant No,6 is arbitrary, illegal and contrary to Rules 2010. ' In support of case of defendant No,7, Mr. Yawar Farooqui learned counsel, argued that in terms of publication dated 28.11.2014 defendants Nos.1 to 4 invited bids in single stage two envelops through authorized dealers, manufacturers, distributors, wholesalers, and in terms of the publication the date of opening the technical bid was 15.12.2014 however in view of corrigendum three days' time was extended except the tender of Peg Interferon. It is contended that the attendance sheet available on record in respect of Hepatitis medicine clearly shows that the procedure adopted was transparent and the participants were satisfied. He submitted that all the bids except for tender 1 were opened on 18.12.2014. It is argued that the opening of the bid of Pegylated Interferon was not
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opened due to some reservations of evaluation criteria by the technical committee and hence it was adjourned to 26.12.2014. He further argued that even on 26.12.2014 it was not opened and the matter was adjourned to 30.12.2014 to be taken up at 2:30 p.m. It is urged that as per tender document there were certain conditions for eligibility including FDA condition. He has relied upon order passed in C.P. No,D-6723 of 2014 which was filed by some bidder alleging therein that the government intends to purchase substandard medicines and has willfully omitted condition of FDA/EMA and that on an undertaking given by the Secretary Health the petition was disposed of on the assurance that all the supplies in consequence to the tender process would be of international standard. Hence, in consequence thereof such meeting of the Evaluation/Technical Committee was adjourned to 30.17.2014 and the defendant No,6's bid for product 3 miv injection was accepted however for Peg Interferon, the defendant No,6's bid for plaintiff product was rejected. ' Learned counsel on preliminary issue in view of the above contended that as per Rule 31 of SPP Rules the suit…
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