If you had some sort of replacement surgery at Mater Dei Hospital during the past decade or so, chances are that the artificial component used for your procedure may have been purchased from a company mired in corruption allegations.
Supplying everything from knee replacement prosthetics to pacemakers and implantable antibacterial envelopes that protect devices installed inside the human body, Technoline is a veritable Maltese giant in the field of medical technology.
Originally incorporated in 1978, Technoline was first cast under the glare of the media spotlight in July 2017. Ivan Vassallo, who at the time worked as a sales and marketing manager for the same company, had suddenly bought out the company’s shares, raising immediate questions about how the purchase was financed.
Vassallo bought out those shares shortly before Vitals Global Healthcare, the private concessionaire that was managing three public hospitals at the time, handed Technoline exclusivity over all the procurement needs for those same hospitals: Karin Grech, St Luke’s, and Gozo General.
While the obvious conflict of interest had immediately raised red flags, disgraced former health minister Konrad Mizzi had simply shrugged it off, insisting that “the private sector has a right to enter into contract with whoever it likes.”
A photo of Karin Grech Rehabilitation Hospital when it was still being ‘managed’ by Steward Healthcare.
It was only two years later that the true nature of the acquisition was revealed in an exposé published by The Shift News, which was based on a share purchase agreement showing how VGH’s investors secretly funded the takeover with a €5 million loan to Gateway Solutions Ltd, the company Vassallo used to acquire Technoline.
In simple terms: after securing the concession to run three hospitals, VGH secretly bought out Technoline through a proxy and then started sourcing all hospital supplies from that same proxy. VGH investors effectively gave themselves a source of revenue that could have potentially set them up for the rest of their lives.
The publication of the magisterial inquiry’s findings about the hospitals deal tied the whole story together.
The forensic analysts who penned the report that formed the basis of the inquiry’s conclusions suspected that disgraced former health minister Konrad Mizzi, Muscat’s disgraced former chief of staff Keith Schembri, and two of the other accused (former Allied Newspapers managing director Adrian Hillman and contractor Pierre Sladden) were planning on acquiring ownership of Technoline, and that Vassallo merely served as a front for a front.
In 2022, Vassallo filed a judicial protest against his former backers, claiming unspecified damages from VGH investors.
In spite of the fact that Vassallo and the company itself are now facing money laundering and fraud charges alongside the other accused, the company’s access to lucrative public procurement remains unhindered.
In May last year, shortly after charges were filed against Technoline and the other defendants in the hospitals case, the company almost immediately placed itself under court-ordered administration. At the end of that same month, Technoline was served with a €5 million freezing order, which meant that every single payment in and out of the company became subject to the court’s discretion.
In spite of this precarious financial situation and high levels of legal exposure, an analysis carried out by The Critical Angle Project can confirm that Technoline raked in a total of at least €1.8 million in public contracts since it went under administration.
This forms part of a wider, systemic dependence that the entire public healthcare system has on this one major supplier.
A full analysis of the public contracts awarded to Technoline since the Labour government swept to power in 2013 shows that this pattern of dependence spikes massively whenever the health system buckles under pressure, with the COVID pandemic serving as a clear example.
It also raises fresh questions about the validity of a public procurement process that involves a supplier with an artificially enforced monopoly on a vital sector and obvious links with corruption at the highest levels of government.
Technoline was awarded a total of 1,168 public contracts since 2013 – 533 tenders worth €100 million, and 635 direct orders worth €24 million.
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Procurement patterns
Almost immediately after VGH investors took over Technoline, news reports citing hospital staff and former medical suppliers flagging massive price increases on typical hospital line items began making the rounds.
The forensic analysts appointed by the inquiring magistrate had further lent credibility to this assertion after determining that there was an 8% mark-up on items that Technoline sold to VGH-run hospitals, effectively jacking up the amount of taxpayer money being pumped straight into Technoline’s coffers.
Given the massive volume of contracts we investigated and the fact that Technoline never contested reports about its alleged price gouging practices, we felt it was pertinent to better understand what kind of products and services Technoline provides to public healthcare.
Though it was not possible to confirm whether price gouging did occur without access to invoices that can be compared to market-price versions of the same product, we still had a lot of data with which we could build a more detailed picture.
To do so, we prompted a large language model (LLM) to clean up the data, highlight repeat patterns, assess structural dependency, and then cross-reference that data with the company’s latest audited financial statements.
Specifically, we started the LLM-assisted analysis by sorting search hits for medical keywords from high to low, matching descriptions of the form and function of the most frequently cited equipment, and to highlight any repeat patterns for keywords like “repair” and “maintenance” which indicate that the contract was for a service and not for a usable item.
These results clearly show that Mater Dei Hospital is highly dependent on Technoline for its supplies, with the keyword ‘Mater Dei’ cropping up in 273 different contracts. Some contracts did not specify where the item or service was to be used/provided, so the actual number of Mater Dei contracts could be much higher.
It is practically impossible to operate a modern hospital without these items. It is also a known fact that whenever a public healthcare system’s services are dependent on providers with the kind of exclusivity that was afforded to Technoline, the possibility of shortages and critical service disruptions increases dramatically.
Based on our analysis of search mentions, we can state that endoscopy units and operating theatres in various departments at Mater Dei Hospital would be the most immediately affected if Technoline were to stop operating.
Further analysis shows that the public healthcare system isn’t just dependent on Technoline to supply its equipment, but also for the provision of repair and maintenance services. As was pointed out in this article, a company like Technoline would make more of a killing off the maintenance contracts rather than from selling high-ticket medical devices.
If the critical infrastructure of a hospital like Mater Dei depends on one major supplier, a potential company shutdown wouldn’t just disrupt access to new equipment and increase the likelihood of critical shortages: it would also throw regular maintenance routines into total disarray.
While it is unlikely that Technoline will collapse overnight (especially since the health minister himself explicitly said the government will continue making use of the company’s services), the fact is that a guilty verdict on the charges faced by the company would practically all but seal its fate.
In May of last year, shortly after charges were filed against Technoline and the other defendants, health minister Jo Etienne Abela told Times of Malta that the government has “contingency plans” in place if Technoline falters. The health minister insisted that he would personally ensure that public health services would continue uninterrupted, without specifying what the contingency plan actually is.
In light of the concerns we outlined about Technoline’s ability to continue operating in its current situation, we directly asked the health minister to elaborate about what this contingency plan is and why it hasn’t been made public as of yet.
No answers were forthcoming by publication time. Technoline also refused to acknowledge our request for comment.
One project crashes, the other stalls
A DOI photo of the Vincent Moran Regional Hub in Paola.
Besides the disastrous hospitals concession deal, another pertinent example of the negative impact of corruption on public healthcare is the Vincent Moran Regional Healthcare Hub project.
“Inaugurated” to much fanfare in May 2024, the regional healthcare hub remains closed to this day, with the health minister publicly stating that he cannot give a date for its actual opening.
According to an article published by The Shift News on Friday, the health minister is now pushing for the facility to open prematurely, in spite of the fact that the health hub remains unfinished.
A photo of the government’s staged inauguration of the Vincent Moran Regional Healthcare Hub in May 2024. Photo: DOI
The project missed its deadline by over three years and counting, in spite of its early inauguration midway through a heated election campaign and the initial rumblings of a criminal case implicating a disgraced former prime minister.
The massive €22 million contract was awarded to a consortium – a company named Ergon, and Technoline. Early news articles from 2019 reported that the original price tag for the health hub was meant to be just €3.2 million, a fraction of the bill that taxpayers ended up footing for this project.
By September of last year, the health ministry was forced to come clean about the contractor’s failure to deliver key project milestones on time. The contract was terminated after a protracted legal battle with the consortium, leading to yet another instance in which the government was forced to step in and retake a healthcare project that was handed off to a private company mired in corruption allegations.
Editorial note:
This investigation was supported by analytical work carried out using ChatGPT 4o, OpenAI’s large language model, which assisted with:
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Data processing and pattern recognition across more than a decade of public procurement records linked to Technoline Ltd.
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Extraction and categorisation of hospital departments and equipment types to assess structural dependencies in the healthcare system.
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Generation of a Medical Risk Index by department, combining contract frequency, clinical criticality, and supplier risk.
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Analysis of Technoline’s 2023 audited financial statements, with attention to profitability, solvency, and legal exposure.
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Construction of an evidence-based briefing that examined the likelihood of operational disruption and the strategic risk posed to Malta’s public hospitals.
All interpretations and conclusions were developed in collaboration with a human investigative journalist.