Forensic accountants found no documentation supporting a $7 million cost increase. AHS is now in court trying to recover tens of millions for medication that never arrived.
In July 2023, Alberta Health Services renegotiated a contract with MHCare for children’s pain medication. The original contract was valued at approximately $49 million. After renegotiation, the price rose to $56 million.
The question that should have been asked at the time was straightforward. What justified a $7 million increase?
The Forensic Review Found Nothing
A retired Manitoba justice, Raymond Wyant, was tasked with investigating. He engaged RSM, a forensic accounting firm, to examine the contract documentation. Their conclusion, stated plainly in the addendum report, was that they could not find support for the $56 million contract value based on the documentation reviewed.
That sentence deserves to be read twice. A forensic accounting firm hired to examine a public health procurement contract could not locate the documentation that would explain why the contract cost $7 million more than the original agreement.
What Alberta Got for $56 Million
The medication was sourced from Atabay Pharmaceuticals, a Turkish supplier. Alberta purchased approximately $20 million worth of usable product. The bottles carry expiration dates between January and April 2026, meaning the province is currently using the final batches of medication from a deal that has otherwise failed to deliver on its terms.
AHS is now taking legal steps to recover between $42 million and $50 million for medication that was never received.
The arithmetic tells the story clearly. Alberta committed $56 million to a contract. It received roughly $20 million in usable product. The remaining $36 million or more in value either was never delivered, was delivered in unusable form, or cannot be accounted for through the available documentation. And the $7 million increase that inflated the contract from $49 million to $56 million has no documented justification.
These are public dollars. This is a public health system. The medication was for children.
Questions That Remain Unanswered
The procurement failure raises several questions that the available reporting has not fully answered.
First, who authorized the renegotiation from $49 million to $56 million, and what internal review process was applied to that decision? Contract increases of this magnitude in public procurement typically require documented justification, competitive analysis, or at minimum a written rationale from the responsible authority. If that documentation exists, the forensic accountants did not find it.
Second, what due diligence was performed on MHCare’s capacity to deliver? The vendor’s failure to supply the contracted volume of medication suggests either insufficient vetting of the supplier’s manufacturing and logistics capabilities or a supply chain breakdown that was not adequately monitored after the contract was signed.
The Legal Recovery Is No Guarantee
Third, what oversight mechanisms were in place between the contract signing and the point at which non-delivery became apparent? Public procurement of this scale should include milestone-based payment structures, delivery verification protocols, and contractual triggers for remediation when suppliers fall behind schedule. The fact that AHS is now pursuing legal recovery rather than exercising contractual protections suggests those mechanisms were either absent or insufficient.
The legal recovery effort itself introduces uncertainty. Pursuing $42 to $50 million through litigation against an international vendor is expensive, slow, and carries no guarantee of full recovery. Legal costs will further reduce the net return to taxpayers. And the litigation timeline means that final resolution may be years away.
An Investigation That Raises More Questions Than It Answers
The Justice Wyant investigation was a necessary step. But an investigation that concludes it cannot explain the pricing is not a resolution. It is a finding that invites further scrutiny.
The provincial government has not announced a follow-up inquiry or an expansion of the forensic review’s scope. That silence is notable. When $56 million in public health spending produces $20 million in usable medication and a forensic report that cannot explain the contract price, the public interest demands more than litigation against the vendor. It demands a full accounting of the internal decisions that led to this outcome.
Alberta’s healthcare system handles billions in procurement annually. The controls that protect that spending are only as strong as the documentation behind them. In this case, the documentation was not there.
That is the finding. What follows from it is the question no one in government has yet been willing to answer publicly.
Thomas Kincaid covers investigative reporting for the Alberta Tribune.
