An antiretroviral (ARV) tender worth R4.3 billion over two years has been awarded to 10 pharmaceutical companies, Health Minister Aaron Motsoaledi announced.
This represented a R4.7 billion saving over what the government had previously paid for rolling out ARVs.
"South Africa can now afford to treat twice as many people with the same amount of money," he said. "It is notable that these tender price reductions have been achieved through the same suppliers that are contracted in the current tender."
The new tender starts in January 2011 and runs for two years.
More competition = better prices
He attributed the lower tender price from the same suppliers to increased competition and a better tendering process.
Asked why the same suppliers were able to provide ARVs at a lower cost he replied: "Perhaps it was our mistake in government, perhaps we were sleeping."
He said he was not at this stage contemplating a "witchhunt" of suppliers who had overcharged. Some of the suppliers had claimed that at lower prices there would be substantial job losses, he said.
"I called their bluff. There are more profits in pharmaceuticals than in oil. My message to pharmaceuticals is that they are in a sector that is very sensitive. They mustn't fish from our troubled waters."
He said the government hoped to replicate the success of cutting the cost of procuring ARVs when it focused on the tender process for tuberculosis drugs, vaccines and drugs for the treatment of diseases related to maternal and child health. - (Sapa, December 2010) - (Sapa, December 20101