Sen. Panfilo Lacson insisted on Friday that documents will prove lingering concerns of an alleged “overprice” in personal protective equipment (PPEs) purchased by the government from Pharmally Pharmaceutical Corporation.
This, as Sen. Richard Gordon lamented President Duterte’s continuing tirades against him—and now, also dragging in the Philippine Red Cross (PRC) that he chairs—just because he is leading the inquiry into pandemic-related contracts linked to businessmen with alleged Palace connections, notably Duterte friend and former economic adviser Michael Yang.
Gordon chairs the Senate Blue Ribbon Committee conducting the inquiry into the bulk purchase of PPEs at the height of the pandemic in 2020. At the center of focus is the Procurement Service of the Department of Budget and Management, which awarded the Pharmally contracts on behalf of the Department of Health. The DOH’s transfer of P42 billion of its funds to PS-DBM, without a memorandum of agreement, was earlier flagged by the Commission on Audit.
Addressing Duterte, Gordon said, “Today, I tell you, you are not a President the Filipino people can respect.”
Duterte, said Gordon was behaving like a “cheap politician” in defending the likes of Lloyd Christopher Lao, the former head of the PS-DBM who presided over the controversial award of over P8 billion in contracts to Pharmally.
Lacson said probers expect to obtain documents that will prove the overprice, apart from other irregularities in the purchases from Pharmally, which drew attention because it is a low-capital start-up that bagged more than P8 billion in contracts.
Earlier, testimonies given to the House of Representatives by PS-DBM officials insisted there was no overprice in the bulk delivery of face masks, face shields and other anti-pandemic supplies.
According to Lacson, the paper trail will show the documents starting with the PS-DBM buying face masks from Pharmally at P27.72 per piece—at a time that other suppliers were selling at P13.50 each.
Senators said the purchase was clearly questionable as it violated a resolution by the Government Procurement Policy Board stating that government purchases should be bought from legally, technically and financially capable firms.
Pharmally’s financial capability was in focus earlier because its officials admitted to senators they borrowed, on several occasions, funds from Yang, in order to cover the initial deliveries to PS-DBM.
During a hearing of the Blue Ribbon Committee, it was shown that P8.67 billion was the total amount of contracts awarded to Pharmally last year, apart from almost P2 billion worth of contracts this year.
Lacson made it clear they are not targeting President Duterte or any one in particular in conducting their inquiry, as they were only making sure public funds are spent properly amid the pandemic.
Hontiveros: Who ordered irregular delivery?
Also at Friday’s hearing, Sen. Risa Hontiveros pressed Pharmally incorporator Krizle Mago to reveal who ordered the irregular delivery of millions of face masks.
The senator showed a message exchange between Mago and a former PS-DBM employee, in which Mago asked if the PS-DBM employee was aware that Pharmally delivered 2 million pieces of surgical masks.
In the text exchange, Mago also said she was only told to deliver the goods by a certain “boss.”
Asked to reveal who she was referring to, Mago pointed to Pharmally representatives Mohit Dargani and Linconn Ong. Both Dargani and Ong denied knowledge of the supposed order.
Hontiveros was amazed by the grit of the Pharmally group to “deliver such a huge volume,” adding, “The only logical conclusion is that someone might have underhandedly guaranteed this contract for them even before any documentation was done. The question is: who is this favored one?”
Hontiveros flagged Pharmally’s unsolicited delivery of 2 million units of surgical masks even before the company received a Request for Quotation or a Notice of Award.
“They sent over 2 million face masks even before a price was agreed on. The price of masks in the first quarter of 2020 was very volatile,” Hontiveros said.
Hontiveros then presented the correct process for an emergency procurement: issuance of request for proposals, opening of proposals, evaluation, negotiation (e.g., terms of delivery), issuance of resolution recommending the award, issuance of the Notice of Award, and then the Purchase Order.
“In the case of Pharmally, the 500,000 mask delivery came before notice of award. It came before purchase order. Then, these 2 million pieces of surgical mask, there was no notice of award, no purchase order, and no request for quotation,” Hontiveros said.
“Why did the PS-DBM leadership allow this? It seems a very powerful person is keeping our own government on a tight leash,” Hontiveros concluded.