PUNJAB SAFE MEDICAL SUPPLIES AUTHORITY ACT 2018

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THE PUNJAB SAFE MEDICAL SUPPLIES AUTHORITY ACT 
2018  
(II of 2018) 
CONTENTS 
1. Short title, extent and commencement 
2. Definitions 
3. The Authority 
4. Composition of the Authority  
5. Disqualification of members 
6. Functions of the Authority 
7. Categorization of storage premises 
8. Business and Scientific Board 
9. Chief Executive Officer 
10. Employees, etc  
11. Committees 
12. Recovery of dues 
13. Delegation of powers 
14. Fund  
15. Fees and charges 
16. Budget 
17. Accounts 
18. Bank accounts 
19. Audit 
20. Annual performance report 
21. Monitoring and evaluation 
 
 
22. Employees to be public servants  
23. Indemnity 
24. Administrative penalty 
25. Rules 
26. Regulations 
 
 
TEXT 
1
THE PUNJAB SAFE MEDICAL SUPPLIES AUTHORITY ACT 2018 
(II of 2018) 
[15 February, 2018] 
An 
Act 
to establish an Authority for procuring drugs and medical equipment and providing 
them to the public health facilities in the Punjab 
It is necessary to establish an Authority for pu rposes of procuring quality 
drugs and medical equipment and for effective administration for prompt and 
equitable distribution to the public health facilities in the Punjab; and, for ancillary 
matters. 
Be it enacted by the Provincial Assembly of the Punjab as follows: 
1. Short title, extent and commencement .– (1) This Act may be cited as the 
Punjab Safe Medical Supplies Authority Act 2018. 
 (2)  It extends to whole of the Punjab. 
(3)  It shall come into force on such date as the Government may, by 
notification, specify and different dates may be so specified for different areas and 
for different public health facilities. 
2. Definitions.– In this Act: 
(a) “Act” means the Punjab Safe Medical Supplies Authority Act 2018; 
(b) “Authority” means Punjab Safe Medical Supplies Authority; 
(c) “Chief Executive Officer” means the Chief Executive Officer of the 
Authority; 
(d) “contract‟‟ means an agreement between the Authority and any other 
party for the procurement of goods and services; 
(e) “drug” means any drugs inclu ding tablets, syrups, injections, enemas, 
ointments, drops, creams, lotions, intravenous drips, serum and 
vaccines being used in the health facilities for any medical or surgical 
treatment; 
(f) “equipment” means any biomedical apparatus or equipment and 
includes any other article or machinery used in the health facilities; 
(g) “Government” means Government of the Punjab; 
(h) “health facility” means a first aid post, dispensary, basic health unit, 
rural health center, tehsil headquarters h ospital, district h eadquarter 
hospital (teaching and non -teaching), tertiary care hospital, children 
hospital, cardiology, urology, kidney or oncology center, center for 
                                                 
1This Act was passed by the Provincial Assem bly of the Punjab on 31 January, 2018; assented to by the Governor of the 
Punjab on 15 February 2018; and, was published in the Punjab Gazette (Extraordinary), dated: 15 February 2018, pp. 5839-
5845. 
 
 
organ transplant and any other health facility administered and 
managed by the Government or the Federal Government; 
(i) “member” means a member of the Authority and, unless the context 
otherwise provides, includes the chairperson and the vice chairperson 
of the Authority; 
(j) “prescribed” means prescribed by rules or regulations; 
(k) “procurement” means the procurement of goods or services or both for 
the health facilities in accordance with the Punjab Procurement Rules 
2014, and includes the goods or services procured on the request in 
writing from a private health facility or trust hospital; 
(l) “regulations” means the regulations framed under the Act; 
(m) “rules” means the rules made under the Act; 
(n) “specifications” mean the specifications of a drug or equipment 
prescribed by the Authority; 
(o) “storage premises”  means any place for the storage of drugs or 
equipment or both; and 
(p) “transportation vehicle” means the vehicle deployed for the 
transportation of drugs or equipment or both. 
3. The Authority .– (1) The Government may, by notification in the official 
Gazette, establish Punjab Medical Supplies Authority for carrying out the purposes of 
the Act. 
 (2) The Authority shall be a body corporate, having perpetual succession 
and a common seal, with power to enter into contracts and acquire or, subject to 
subsection (3), dispose of property, and may by its name, sue or be sued. 
 (3) The Authority shall not dispose of any immovable property without prior 
approval, in writing, of the Government. 
(4) The headquarters of the Authority shall be at Lahore but the Authority 
may, with the prior approval of the Gove rnment, establish its offices at such other 
place or places in the Punjab as may be deemed necessary to accomplish the 
purposes of the Act. 
4. Composition of the Authority .– (1) The Authority shall consist of the 
chairperson who shall be appointed by the C hief Minister and the following 
members: 
(a) three members of Provincial Assembly of the Punjab to be nominated 
by the Speaker; 
(b) Parliamentary Secretary for Specialized Healthcare and Medical 
Education;  
(c) Secretary to the Government, Specialized Heal thcare and Medical 
Education Department; 
(d) Secretary to the Government, Primary and Secondary Healthcare 
Department; 
 
 
(e) Secretary to the Government, Finance Department; 
(f) Secretary to the Government, Industries Commerce and Investment 
Department; 
(g) two renowned pharmacists; 
(h) two renowned professors of pharmacology; 
(i) one renowned biomedical or electrical engineer;  
(j) one representative of Chamber of Commerce and Industry; and 
(k) Chief Executive Officer (Member/Secretary). 
 (2) The Government may, by notification in the official Gazette, increase 
the membership of the Authority if public interest so requires. 
(3) The Government shall, for a term of three years, nominate the members, 
other than ex officio members, but at least one female member shall be so nominated 
against the categories mentioned in clauses (a), (g) and (h) of subsection (1). 
 (4) The Government may, at any time, remove the chairperson or member, 
other than ex officio member. 
(5) The chairperson or member may submit his resigna tion to the 
Government.  
(6) The Government may designate a member of the Authority as vice 
chairperson of the Authority.  
(7) The Vice Chairperson shall perform such functions as may be 
prescribed or as the Authority may assign. 
(8) No act or proceedings of the Authority shall be invalid merely on the 
ground of the existence of any vacancy or defect in the constitution of the Authority.  
5. Disqualification of members .– No person shall be appointed a member, or 
shall continue to be a member who:  
(a) is or , at any time, has been convicted of an off ence involving moral 
turpitude; 
(b) is or, at any time, has been adjudicated as an insolvent;  
(c) is found to be of unsound mind; and  
(d) has a conflict of interest with the Authority and fails to disclose, in 
writing, such conflict of interest to the Authority.  
6. Functions of the Authority .– (1) The Authority may perform such functions 
and exercise such powers as may be necessary for carrying out the purposes of the 
Act.  
(2) Without prejudice to the generalit y of the functions and powers under 
subsection (1), the Authority shall:  
(a) procure quality drugs and equipment at competitive rates for the health 
facilities;  
 
 
(b) prescribe the standards, procedures, processes and guidelines under 
the Act with respect to the procurement of drugs and equipment for the 
health facilities; 
(c) prescribe the formularies and specifications of equipment for various 
categories of health facilities; 
(d) conduct or cause to be conducted researches relevant to its functions 
under the Act; 
(e) pre-qualify the firms, sole agents or authorized dealers for the 
procurement of drugs and equipment; 
(f)  prescribe standards and procedures for the storage and supply of 
drugs and equipment and ensure that the drugs are stored under the 
prescribed storage conditions; 
(g) establish premises and ware houses for drug storage as per best 
international practices or obtain such storage facilities from private 
sector; 
(h) prescribe guidelines for proper storage and disbursement of the drugs 
in a health facility; 
(i) ensure timely supply of drugs and equipment to each category of the 
health facilities; 
(j) devise an annual calendar for the procurement of drugs and 
equipment; and 
(k) perform such other functions as may be incidental to the functions 
mentioned above or as the Government may assign or as may be 
prescribed by rules. 
(3)  The Authority shall exercise its functions, as far as possible, in 
accordance with the well-established international best practices, scientific principles 
and procedures. 
7. Categorization of storage premises .– (1) The Authority shall, by 
regulations: 
(a) categorize storage premises for the storage of drugs or equipment or 
both; and 
(b) prescribe the standards and procedures, based on established 
scientific principles and i nternational best practices for the storage and 
transportation of drugs and equipment. 
(2)  The Authority shall issue a certificate for every storage premises and 
transportation vehicle in the prescribed manner.  
(3) The certificate issued under subsection  (2) shall be displayed at a 
conspicuous place of the storage premises or, as the case may be, the 
transportation vehicle. 
8. Business and Scientific Board .– (1) The Authority shall establish a 
Business and Scientific Board, consisting of the following: 
(a) Chief Executive Officer; 
 
 
(b) one member possessing the prescribed qualification in pharmacy and 
having five years‟ experience of working in an organization established 
for determining standards and quality of drugs; 
(c) one member possessing the prescrib ed qualification in biomedical or 
electrical engineering and having five years‟ experience of working in 
an organization established for scientific or industrial research on 
biomedical and allied equipment; 
(d)  one member possessing the prescribed qualifi cation in pharmacology 
and having five years‟ experience of working in a public sector medical 
college or medical university; 
(e)  one renowned surgeon or physician; 
(f)  one renowned businessman having experience in the procurement of 
drugs and equipment; and 
(g)   two experts in procurement.  
 (2) The Chief Executive Officer shall be the convener of the Board. 
 (3)  The Board may co-opt any other member from the relevant industry. 
(4)  The Authority shall determine the terms and conditions of the members 
of the Board, other than ex-officio members. 
(5)  The Authority may refer any matter relating to procurement to the 
Board for recommendations. 
(6)  The Board may make recommendations to the Authority with respect to 
the standards, products, procedures, pro cesses and guidelines in relation to any 
technical aspects of procurement. 
(7) The Authority may, after recording reasons, refer the recommendations 
to the Board for reconsideration either generally or any particular aspect of the 
recommendations. 
(8)  The Board shall reconsider the case and shall again submit its 
recommendations and the Authority shall act accordingly. 
9. Chief Executive Officer .– (1) Subject to the general supervision and control 
of the Authority, the administration and management of the affairs of the Authority 
shall vest in the Chief Executive Officer. 
(2) The Chief Executive Officer shall have such qualifications, experience, 
age and other requirements, shall receive such salary and allowances, and be 
subject to such conditions of servi ce as may be prescribed by rules, and until so 
prescribed, as the Government, on the recommendations of the Authority, may 
determine. 
(3) The Chief Minister shall appoint the Chief Executive Officer. 
(4)  The Chief Executive Officer shall be the whole time  officer of the 
Authority and shall exercise such powers and perform such functions as may be 
prescribed or as the Authority may delegate. 
10. Employees, etc .– (1) The Authority may, on such terms and conditions as 
may be prescribed by regulations, appoint  advisors, consultants, experts or other 
 
 
administrative and technical personnel necessary for the discharge of its functions 
under the Act. 
 (2) The Government may, with the concurrence of the Authority, transfer 
the services of any of its employees to the Authority. 
(3)  The Authority may, with the concurrence of the employee and the 
Government, absorb the services of the employee into its service on the terms and 
conditions as are acceptable to the employee and approved by the Government. 
(4)  The terms a nd conditions of the service of an employee transferred 
from the Government shall not be less favourable than those in his parent 
department.  
11. Committees.– (1) The Authority may constitute standing or special 
committees by such nomenclature as it deems  necessary and assign functions to 
each such committee. 
(2) The committee may consist of the members and such other persons as 
may be necessary. 
12. Recovery of dues.– Any sum due to the Authority from any person under the 
Act, shall be recoverable as arrears of land revenue under the Punjab Land Revenue 
Act, 1967 (XVII of 1967). 
13. Delegation of powers .– The Authority may delegate any of its functions to 
the chairperson, vice -chairperson, a member, Chief Executive Officer, committee or 
an employee of the Authority, except the following functions: 
(a) adaptation, amendment or repeal of regulations; 
(b) approval of annual budget of the Authority; 
(c) consideration and decision on the audit reports; 
(d) approval of policies, standards, procedures and guidelin es for the 
discharge of functions by the Authority; 
(e) approval of the annual reports; and 
(f) constitution of the committees and filling a vacancy in a committee. 
14. Fund.– (1) There shall be a Fund to be known as Punjab Safe Medical Supplies 
Authority Fund. 
(2) The Fund shall vest in the Authority and shall be utilized by the 
Authority to meet its expenses including the payment of salaries and other 
remuneration to the members, officers, employees, experts, advisers and 
consultants. 
(3)  The Fund shall consist of: 
(a)  loan and grant by the Government or the Federal Government or from 
any other source; 
(b) fee, charges and other moneys received by the Authority; 
(c)  income from lease or sale of the property; and 
(d)  all other sums received by the Authority. 
 
 
(4) The Authority shall not incur any loan without prior approval of the 
Government. 
(5) The Authority shall frugally meet all its expenses from the Fund.  
15. Fees and charges .– The Authority may, with the prior approval of the 
Government, impose fees and charges for the services it renders. 
16. Budget.– (1) The Chief Executive Officer shall prepare the budget of the 
Authority for each financial year commencing on first day of July of a year and 
ending on thirtieth day of June of the succeeding year. 
(2) The Chief Executive Officer shall place the budget for approval before 
the Authority at least ninety days prior to the commencement of a financial year. 
(3) After the Authority has approved the Budget, the Chief Executive 
Officer shall submit the budg et to the Government for sanction at least sixty days 
prior to the commencement of a financial year. 
17. Accounts.– The Authority shall maintain proper accounts and other relevant 
records and prepare annual statement of accounts in such form and manner as may 
be prescribed.  
18. Bank accounts.– The Authority may open and maintain its accounts at such 
scheduled banks as may be prescribed, and until so prescribed, as the Authority 
may determine. 
19. Audit.– (1) The Auditor General of Pakistan shall conduct au dit of the 
accounts of the Authority.  
(2) In addition to the audit under subsection (1), the Authority may appoint 
a firm of chartered accountants placed in category „A‟ by State Bank of Pakistan, for 
the annual audit of the accounts of the Authority.  
(3)  The auditors appointed under subsection (2) shall submit the report to 
the Authority and the Government and the Authority shall take such action and make 
such decisions as may be necessary in the light of the audit report or as directed by 
the Government. 
20. Annual performance report.– (1) The Authority shall prepare and forward to 
the Government by 30 October each year, the annual performance report. 
(2)  The report shall consist of: 
(a)  the statement of accounts and audit reports of the Authority; 
(b)  a comprehensive statement of the work and activities of the preceding 
financial year and its proposed projects and schemes; and 
(c)  such other matters as may be prescribed or as the Authority may 
consider appropriate or as the Government may direct. 
(3)  The Government may, after considering the report, issue such 
directions to the Authority as may be necessary for carrying out the purposes of the 
Act and the Authority shall implement such directions. 
 
 
21. Monitoring and evaluation. – (1) The Government m ay, at least once in a 
year, conduct or cause to be conducted, the performance audit of the Authority to 
assess and evaluate the performance of the Authority in accomplishing the 
objectives of the Act.  
(2) The Government shall evaluate the report and shal l issue such 
directions to the Authority as may be necessary and the Authority shall implement 
the directions. 
22. Employees to be public servants .– The chairperson, vice chairperson, 
Chief Executive Officer, members, officers and other personnel of the Au thority, 
acting or purporting to act in pursuance of any of the provisions of this Act, shall be 
deemed to be public servants within the meaning of section 21 of the Pakistan Penal 
Code, 1860 (XLV of 1860).  
23. Indemnity.– No suit, prosecution or other le gal proceedings shall lie against 
the Authority, the chairperson, vice chairperson, member, officer, servant, expert or 
consultant of the Authority in respect of anything done or intended to be done in 
good faith under the Act. 
24. Administrative penalty .– (1) A person who fails to display the certificate 
issued to him under section 7 of the Act or removes the certificate or tempers with or 
defaces or mutilates the certificate in any manner whatsoever shall be guilty of an 
offence and may, in the prescribed manner, be awarded administrative penalty which 
may extend to five hundred thousand rupees but which shall not be less than twenty 
five thousand rupees. 
 (2) In case the offence under subsection (1) is repeated, the maximum 
administrative penalty of rupee s five hundred thousand shall be awarded and, in 
addition, the competent authority may, in the prescribed manner, decide to nullify the 
contractual arrangement with such person and cancel the licence or permit issued to 
him.  
(3) Any person aggrieved by a final order under subsection (1) or 
subsection (2) may, within thirty days of the receipt of order, submit a representation 
to the appellate committee constituted by the Authority and the decision of that 
committee shall be final. 
25. Rules.– The Governmen t may make rules for carrying out the purposes of 
this Act. 
26. Regulations.– Subject to this Act and the rules, the Authority may, by 
notification, frame regulations to give effect to the provisions of the Act.