An audit by the Instituto de Previsión Social (IPS), Paraguay’s institution responsible for social security and public health services, identified cumulative discrepancies of up to G. 625.159 billion between medicines recorded in its systems and the physical inventories in pharmacies and warehouses.
The amount does not in itself indicate that medicines physically disappeared. IPS says the figure includes incorrectly recorded movements, such as medicines already delivered to patients, returns and transfers between facilities that continued to appear as available. The institution attributes the problem to operational, administrative, technological and accounting failures accumulated over several years.
The main source was incomplete integration between the Integrated Hospital System (SIH), used to record deliveries and other movements, and the SAP MM logistics module, responsible for controlling inventories and values. Consumption that was not properly transferred, returns that were not updated in the central accounting system, and transfers that were blocked or marked as errors produced a “virtual inventory” that did not correspond to reality.
Annual differences were G. 13.875 billion in 2020, G. 133.511 billion in 2021, G. 163.532 billion in 2022, G. 271.394 billion in 2023 and G. 32.075 billion in 2024. The sum of these records reached G. 614.390 billion; another G. 10.768 billion was associated with discrepancies in virtual logistics centers.
The largest mismatch occurred in 2023, a period that also coincided with a medicine-supply crisis at IPS. The audit recommended assessing how the distortion affected the financial statements and may have overstated the institution’s assets between 2020 and 2024. The amounts were reconciled in previous statements with the backing of a resolution and an external audit, but the report called for an urgent actuarial assessment of the accounting effects.
Juan Carlos Frutos, IPS director of information and communications technology, said the discrepancies are supported by institutional records and were submitted for review and reconciliation. He said that since 2023 the agency has been identifying the pharmacies in its network individually, now distributed across 125 locations, as well as carrying out inventories, comparing the systems and adjusting integration processes.
Frutos also said that the cases identified in 2026 were corrected within the established operational deadline. The audit, however, recorded that inconsistencies still existed in 2025, raising continuing questions about the system’s ability to show in real time which medicines are actually available to insured people.
Among the most critical cases is the Regional Hospital of Encarnación, where medicines were found to be overvalued by G. 36.195 billion without sufficient documentation. The report also mentions Hospital Ingavi. In Encarnación, the pharmacy allegedly dispensed medicines without issuing receipts between July 2023 and December 10, 2025, making it difficult to reconcile physical withdrawals with accounting records.