Court dismisses bid to block deal for distribution of HIV testing kits

The High Court has dismissed a petition seeking to stop the distribution of HIV testing kits manufactured by an Irish firm.
Justice Alfred Mabeya dismissed the petition and lifted the orders issued in August blocking Trinity Biotech Manufacturing Ltd of Ireland from entering into a distributorship agreement with any firm other than Gamma Zenith Kenya Ltd.
The judge dismissed the case after it emerged that an agreement between the Kenyan firm and the manufacturer stipulated that arbitration would handle any dispute.

Gamma Zenith Kenya Ltd moved to court after the manufacturer allegedly terminated the seven-year distributorship agreement and appointed Radiance Pharmaceutical Ltd as the distributor of TrinScreen HIV products and kits, in the country.

"In my view, the forgoing provisions are clear that in the event of a dispute arising from the Exclusive Distribution Agreement, the parties would resort to arbitration to be held in the Republic of Ireland," the judge said.

Read: Firms fight for distribution of HIV testing kits

The judge added that the agreement stated that if the parties want to seek interim measures of protection, it has to be from the courts in Ireland, which have exclusive jurisdiction.
"Informed by the foregoing, this Court has no choice but to down its tools as it lacks the jurisdiction to determine the application and the entire suit," Justice Mabeya ruled.

Gamma Zenith Kenya Ltd said it secured the multi-billion distributorship deal only for the manufacturer to terminate the agreement in June.
“The plaintiff avers that given the term of seven years provided under clause 6.1 of the exclusive distribution agreement, the plaintiff had a legitimate expectation that the agreement would run for the whole seven years, which expectation has now been infringed by the 1st defendant (the manufacturer),” the firm said in the petition.

The fight comes soon after a task force appointed by the Ministry of Health recommended the adoption of the three-test HIV testing algorithm.
Evidence tabled in court stated that Trinity Biotech appointed Gamma Zenith in a letter on November 8, 2021, as the exclusive distributor for TrinScreen HIV products and kits in Kenya, for seven years.
The firm said it has spent substantial amounts of money, time and resources to fulfil the obligation, among them acquiring approvals from various bodies.
Gamma Zenith said it has spent Sh19.3 million so far and anticipated Sh1.1 billion in profits and future earnings from the deal, apart from making commitments to business associates and the government.

The court was informed that in a memo dated August 22, the Ministry of Health said it was in the process of commencing the procurement of TrinScreen HIV kits.

The government through the Ministry is in the process of reviewing HIV testing algorithms to align it with the current recommendations of the World Health Organisation (WHO).

Read: Concern as hospitals run out of HIV testing kits
The Ministry later appointed a task force to undertake a verification study and recommend a new testing algorithm for the country, although the process was stopped by the High Court in Mombasa.

Gamma Zenith said it applied to the Ministry of Health for the kits to be approved by the task force for the adoption of a three-test HIV testing algorithm.

The firm said it further applied and obtained a certificate of validation for reagents and equipment from the Ministry of Health, and was issued with a certificate that runs from February 2022 to February 13, 2025.

Gamma Zenith also applied for and got a medical device registration certificate from Pharmacy and Poisons for the distribution and sale of the kits, a certificate that is valid until February 2027.
The court heard that the firm had donated over 6,000 kits to the ministry’s task force for the adoption of a three-test HIV testing algorithm for validation and field testing exercises.
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