Thiruvananthapuram: The Kerala government has sought a preliminary Vigilance inquiry into alleged financial irregularities at Oushadhi, the State-run pharmaceutical institution under the Department of AYUSH, following a complaint over construction contracts and sales accounts.

Health Minister K. Muraleedharan has sought a preliminary inquiry by the Vigilance and Anti-Corruption Bureau (VACB), while directing the Principal Secretary (Health) to have the allegations examined by the Finance Inspection Wing.

The complaint was submitted by P.B. Satheesh, Director of Nerkazhcha Association, Mullakkara, Thrissur. It alleges irregularities in the award of construction works at Oushadhi and questions the institution's sales figures and accounting practices for 2024-25.

According to the order copy accessed by Mathrubhumi English, the government has asked the VACB to conduct a preliminary inquiry into the allegations. The order also says that a detailed investigation can be taken up if the preliminary findings warrant further action.

Construction works under scrutiny

The complaint alleges that several construction works at Oushadhi were awarded to the Uralungal Labour Contract Co-operative Society (ULCCS) without following the prescribed tender procedures.

Among the works cited are renovations to the manufacturing plant, warehouse and administrative building, besides the installation of a fire-fighting system and an effluent treatment plant.

The petitioner alleges that some of the works were awarded through bid notifications instead of open tenders and that estimates submitted by ULCCS were accepted without negotiations.

The complaint also raises questions over delays in completing some of the projects and alleges that ULCCS was involved as both consultant and contractor in certain works.

Oushadhi sales figures questioned

The complaint also alleges manipulation of Oushadhi's sales and inventory records for 2024-25, including the creation of entries for medicines that had not been manufactured.

According to a report in The Hindu, the complaint claims that Oushadhi's monthly sales were generally around ₹15 crore, but the institution recorded sales of ₹46 crore in March 2025.

The complaint alleges that a substantial part of the March sales figure represented stock that did not exist.

It also alleges that medicines were supplied to dealers on credit without obtaining the 30-day post-dated cheques prescribed by the Oushadhi Board.

The petitioner has further alleged that the pending receivables were not brought to the notice of the Oushadhi Board or the State government by the then managing director.

Government seeks independent examination

The Health Minister has directed the Finance Inspection Wing to examine whether financial rules, tender procedures and accounting practices were followed and submit its findings.

The government order seeks an independent examination of the allegations before any further action is taken.

The complaint also refers to delays in completing Oushadhi's oil and lehyam manufacturing plant and related audit observations.

The allegations have not been established. Oushadhi managing director has denied knowledge of financial irregularities in the institution, according to The Hindu.