2004-05-17

NPM 068-2004

Requesting Entity: Municipal Budget Officer of Monte Vista, Compostela Valley

Issues Concern: Procurement of Medicines using Alternative Methods of Procurement, in particular, Direct Contracting

 

Details

1. Whether or not the Municipality of Monte Vista (Municipality) may procure Medicines using the Alternative Methods of Procurement, in particular, Direct Contracting under Section 50(c) of the Implementing Rules and Regulations Part A (IRR-A) of Republic Act No. 9184 (R.A. 9184).

Under R.A. 9184 and its IRR-A, this alternative method of procurement (Direct Contracting) may be resorted to by the procuring entity only when there is an exclusiveness of dealer or manufacturer and such dealer or manufacturer sells at lower prices and provided further that, no suitable substitute can be obtained by the procuring entity at more advantageous terms. These conditions must all be present before the procuring entity may resort to this alternative method of procurement.

Taking into consideration that medicines are essential necessities of health, it is a given fact that medicines are widely and commonly available. Hence, the procurement of medicines does not necessarily call for an exclusive dealer or manufacturer. As such, the first condition as aforementioned, which is the exclusiveness of dealer or manufacturer is already lacking.

Since not all the conditions prescribed under the aforequoted provision (Sec. 50, IRR-A) are present, we believe that the Municipality should procure the needed medicines for the aforecited project through public bidding and not through Direct Contracting under Section 50 (c) of the IRR-A of R.A. 9184.


2. Whether or not it is mandatory for the Bids and Awards Committee (“BAC”) to recommend the award of contract to the head of the procuring entity in the Alternative Methods of Procurement.

Under Section 12.1 of the IRR-A of R.A. 9184, one of the responsibilities entrusted to the BAC is to recommend the award of contracts to the head of the procuring entity or his duly authorized representative. However, this responsibility is performed by the BAC in cases where the agency procures through competitive bidding or under the alternative methods of procurement where public bidding procedures are required to be adopted, such as Limited Source Bidding under Section 49 of the IRR-A of R.A. 9184, and Negotiated Procurement under Section 53 (a) and (b) of the same rules.

On the other hand, with respect to those alternative methods of procurement where the public bidding procedures are not mandated to be undertaken, such as, Direct Contracting, Repeat Order and Shopping, under Sections 50, 51 and 52 of the IRR-A of R.A. 9184, respectively, there is no need for the BAC to perform such function. Be that as it may, it must be noted that such alternative methods of procurement should be resorted to only upon recommendation of the BAC to the head of the procuring entity and upon determination that any of the exceptional circumstances mentioned in the IRR-A of R.A. 9184 justifying the use of such alternative methods of procurement is present.


3. Whether or not the Municipality may be allowed to specify brand names in the said procurement of Medicines.

Section 18 of R.A. 9184 and its IRR-A, is clear on this point:

Specifications for the procurement of goods shall be based on relevant characteristics and/or performance requirements. Reference to brand names shall not be allowed.

Thus, we believe that the aforequoted prohibitory rule should be complied with.