HSE became embroiled in 'tense exchanges' for ventilators, documents reveal

The HSE's procurement division was involved in a dispute with Galway-based pharmaceutical technology company Medtronic in mid-March 2020, according to documents released under freedom of information.

The HSE became involved in 'tense exchanges' with an Irish healthcare technology provider as pressure increased to ramp up the supply of ventilators at the start of the Covid-19 pandemic.

The HSE's procurement division was involved in a dispute with Galway-based pharmaceutical technology company Medtronic in mid-March 2020, according to documents released under freedom of information.

Medtronic’s status as a leading producer of quality ventilators and its base in Ireland had seen the HSE make overtures towards the company with a view to bulking up Ireland’s own supply of the devices.

In an “unvarnished” memo from HSE chief executive Paul Reid, sent to the Department of Health on March 30, Mr Reid stated that Medtronic — via their contracted distributor, Cork-based Healthcare 21 — had committed to providing 69 ventilators by the week of April 13.

This was significantly less than the volume the HSE had hoped for at the time.

“Discussions and negotiations have been less than fruitful,” Mr Reid said in the released documents.

“Medtronic appears to be unwilling to provide HSE with an allocation that is consistent with the fact that they are headquartered in IE (Ireland) and enjoy significant benefits of such.”

Medtronic for its part meanwhile had asserted, in Mr Reid’s words, that its worldwide market “needs to be supplied”, with 20% of its European allocation going to Ireland. Its general allocation principle was based upon intensive care beds per country, with the company maintaining that Ireland’s allocation was “in excess of this principle”, he said.

He further speculated that Medtronic’s assertion that there was no stock of non-CE (products certified for use in the European Union) marked ventilators available at the time may not in fact have been the case: “We wonder if this is in fact the position,” he said.

The documents reveal that the then chief executive of Medtronic, Omar Ishrak, had requested a meeting with then Taoiseach, Leo Varadkar, regarding the impasse, with the Department of Health official noting that the company was seeking a “range of assurances” that would have been “difficult, if not impossible, for the Government to provide”.

Those assurances included that the company would be deemed an “essential operator” in order to continue its supply lines unimpeded regardless of a lockdown and that it would be prioritised for personal protective equipment (PPE) and contact tracing and testing in the event of an employee contracting Covid-19.

Healthcare 21 did eventually get the contract to provide a significant quantity of ventilators to the HSE, with the executive paying out €12.8 million for 359 devices, at a pre-VAT cost of €24,500 apiece, across the month of March.

It’s unclear if all of those devices emanated in full or in part from Medtronic itself.

Contacted for comment, a Medtronic spokesperson said the company had “delivered ventilators to the Irish health service throughout the pandemic” and confirmed that “we did not raise the price of ventilators due to the demand caused by the pandemic”.

“The global healthcare system was facing an unprecedented challenge and Medtronic responded in an unprecedented way,” the spokesperson said.

Ballincollig-based Healthcare 21 declined to comment.