Pharmally Pharmaceutical Corp. director Linconn Ong was detained at the Senate detention facility after being taken into custody by the Senate Office of the Sergeant-at-Arms on Tuesday for lying and being evasive in answering questions during its probe on overpriced medical equipment.
Earlier in Tuesday’s hearing, Senate President Vicente Sotto III said the arrest warrants against Ong and other Pharmally officials are still standing.
Previously, Sotto said the arrest warrant against Ong was already served. However, Ong was made to stay in his residence as he tested positive for COVID-19.
Meanwhile, the government likely lost P1.25 billion by paying in full for COVID-19 test kits that were near their expiry date, and P550 million from test kits that had already expired, Senator Francis Pangilinan said Tuesday.
At the resumption of the Senate Blue Ribbon committee hearing on the alleged misuse of COVID-19 funds by the Department of Health, Pangilinan cited a letter dated Dec. 7, 2020 signed by Assistant Health Secretary Nelson Santiago addressing Lloyd Christopher Lao, then chief of the Procurement Service of the Department of Budget and Management.
“DOH was requesting a rescheduling of the delivery of Pharmally testing kits because the test kits that were delivered expired. They paid in full for testing kits that were due to expire in six months,” Pangilinan said.
The senator likened this to burning money in the middle of a pandemic.
Two reports from the PS-DBM showed Pharmally delivered 4,800 kits on May 2, 2020, and 3,200 kits on May 4, 2020.
The inspection reports indicate that the kits had a manufacturing date of April 5, 2020 and an expiry date of Oct. 5, 2020, or in six months.
A PS-DBM technical requirement document dated April 21, 2020 indicated that all testing kits must be fresh stock and mush have a shelf-life of at least 24 to 36 months from the date of delivery.
In the previous hearings, Ong and former presidential economic adviser Michael Yang were cited in contempt due to their “evasive” responses to the senators’ questions. The Senate panel had moved for their arrest.
Pharmally, a small startup company, secured more than P8 billion worth of government contracts for the procurement of personal protective equipment (PPEs), which were believed to be overpriced.
“The Pharmally-Michael Yang relationship seems to run deep,” said Senator Risa Hontiveros, who revealed that one of the firm’s executives, Mohit Dargani, has worked as a special assistant to Yang.
Yang introduced the President to the Pharmally executives, who bagged more than P8 billion in government contracts through PS-DBM head Lao, who is from Davao City.
Hontiveros showed in the Senate probe a LinkedIn profile of Dargani, in which he labels himself as “Special Assistant at the Office of the Presidential Economic Adviser.”
“Why do the owners Pharmally have a connection to Michael Yang? Linconn Ong worked with Yang as translator during a meeting of Pharmally with President Duterte in 2017. And now, we learned that Dargani also worked with him,” said Hontiveros.
In the last hearing, the Senate revealed that Pharmally executives bought luxury cars after bagging the lucrative government contract. Hontiveros said she supports Senator Leila de Lima’s call for the Anti-Money Laundering Council to freeze and investigate the assets of Pharmally executives. Full story on manilastandard.net
Pharmally executives Huang Tzu Yen and Linconn Ong had said in an earlier hearing that Yang helped finance or guarantee the purchase of supplies and equipment from their suppliers in China.
However, the senator added, Yang claimed before the House of Representatives that it was the money of his friends that financed Pharmally.
Meanwhile, Lao on Tuesday accused the Senate Blue Ribbon committee of being hostile, as he was grilled over his previous application for the overall deputy Ombudsman post.
Panel chairman Senator Richard Gordon asked Lao to inform the committee why he withdrew his application to one of the key posts in the Office of the Ombudsman.
Lao said there were statements made by certain politicians, criticizing him over his application. He refused to say more.
The Palace on Tuesday said the hearings were being prolonged for political reasons.
“I think if the COA (Commission on Audit) already said there is no overpricing, so I don’t know why [the Senate hearing] continues. Perhaps, the reason is politics,” Roque said in Filipino during an online press briefing.
Roque made the remarks in response to Vice President Leni Robredo’s recent statement that personalities involved in the Senate probe should avoid exchanging personal insults.
The call was apparently triggered by the word war between President Rodrigo Duterte and Senator Gordon.
Duterte has repeatedly questioned Gordon and other senators for taking advantage of the lengthy Senate Blue Ribbon committee hearings ahead of the 2022 national elections by politicizing the government’s management of COVID-19 pandemic response funds.
Other Pharmally testing kit deliveries with available inspection receipts were as follows:
1. 2,000 A*Star Fortitude Kit 2.0 Covid-19 RT-PCR Test delivered two-four months from expiration date, P688 million;
2. 41,400 BGI, Real-Time Fluorescent RT-PCR kit, delivered nine months before expiration date, P2.88 billion; and
3. 312 MGI Easy Magnetic Beads Virus DNA/RNA Extraction, delivered eight months before expiration date, P246 million.
Citing industry insiders, Pangilinan said test kits that have 12 to 18 months of shelf life would have a discount of 10 percent to 15 percent. If the shelf life is within six to 12 months, the discount is at 15 percent to 25 percent. If it’s less than six months, it’s around 30 percent or more.
“But the full amount was paid. That is overpriced. Not just overpriced, that is also using equipment that is substandard or at least lacking in the necessary shelf life for us to be able to effectively deal with COVID [and] avoid deaths and sickness,” he said, noting that a 25 percent discount would have given the government an additional P1.25 billion.
The DOH earlier confirmed 7,925 test kits expired. Each kit would contain 30-50 tests depending on the brand, which was not disclosed.
DOH said a total of 371,794 test kits expired.
With Pharmally’s pricing of P69,500 per machine, Pangilinan said the government wasted an additional P550 million.
“That gives us [an idea of] the gravity, the waste, the incompetence, [and] the corruption that we are facing,” he said.
