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Pharmally overpriced sales to gov’t – Drilon

/ 04:17 PM October 19, 2021
Senators ask Pharmally: Why are products sold to gov’t more expensive than retail?

Mohit Dargani, Pharmally corporate secretary and treasurer

MANILA, Philippines — Officials of Pharmally Pharmaceutical Corp. were asked why their medical supplies were sold to the government at a higher price when their items under a catalog were cheaper.

During the Senate blue ribbon committee hearing on Tuesday, Senator Risa Hontiveros presented data that infrared thermometers were sold to the Department of Transportation (DOTr) at P3,200 per piece, while their catalog for allegedly the same period showed the same item being sold at just P2,000.

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It was the same for goggles sold by Pharmally (P212.50 for government and P149 to P159 in the catalog) and face shields (P179.20 for the government and P95 to P109 in the catalog).

Hontiveros asked Pharmally official Mohit Dargani about it, but Dargani claimed that the different prices of the products were taken from different dates.  But Hontiveros showed Dargani that the receipt and the catalog were for the same month — in April 2020.

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“I believe for the price list, this only came out when we had a stable supply to supply the private market because we prioritize our items for government.  So I believe when these prices came out it was already sometime May or June when the prices may have changed,” Dargani said.

“Ito pong items sa catalog or sa price list po mismo, niretrieve circa May 2020.  So around that time, April and May, na you contracted those two contracts with DOTr-PNR.  So kumbaga magka-contemporary ‘yong price list niyo, saka ‘yong purchase order with the selling price niyo sa DOTr-PNR, pero malayo ang presyo.  Ironically mas mahal ang presyo na siningil niyo sa gobyerno,” Hontiveros replied.

(These items in the catalog or on the price list itself were retrieved circa May 2020.  So around that time, April and May, you signed those two contracts with DOTr-PNR.  So it seems your price list and the purchase order which contained your selling price for the DOTr-PNR are of the same month but have different prices.  Ironically you sold higher for the government.)

The Senator again asked whether this is not a case of the government being disadvantaged as Pharmally overpriced their items.

“You were offering supplies and prices grossly disadvantageous sa gobyerno natin, ‘di ba?  Habang hirap na hirap ‘yong mga frontliners, iniisip pa ng Pharmally, iniisip niyo kumita?” Hontiveros asked.

(You were offering supplies and prices grossly disadvantageous for our government, right?  While people, including frontliners, are already struggling to make a living, you still prioritize income?)

At this point, Senate Minority Floor Leader Franklin Drilon said that the receipt and the catalog presented by Hontiveros are already glaring examples of how Pharmally overpriced their sales.

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“This is the classic, the very example of how Mr. Dargani and Pharmally overpriced their sales to the government.  That is why it is very important that we get hold of the support documents or the source documents for the financial statements on cost of sales,” Drilon said.

“That is where we will show, it will be shown, that there is indeed an overpricing.  Look at these presented by Senator Hontiveros, it is not denied,” he explained.

In response, Dargani said that the more expensive goods, although sold in April, were purchased in March when the prices were still high.  He said that the higher prices should be reflected in their audited financial documents on the cost of sales.

But Drilon admonished him for referring to their audited financial documents on the cost of sales while they refrain from providing the Senate committee a copy of the said document.  The Senator said that they suspect that the actual cost of sales shows that Pharmally purchased the overpriced goods at a low price.

“Oh, you refuse to submit the source documents and yet you readily claim that your cost for this merchandise is higher?  Don’t you see where you’re (going), you think you can get away with this?  Mr. Dargani, you refuse to submit the source documents on the cost of sales, and yet now, you can claim that your cost is higher?” Drilon asked.

“How can we believe you that your cost is higher when you refused to submit to us your cost of sales, your source documents?  And we suspect that your source documents show a very low price, and your additional cost is some payments made somewhere which you do not want to reveal,” he added.

Pharmally remains at the center of the Senate’s investigation on the Commission on Audit (COA) report, which showed deficiencies in the Department of Health (DOH) COVID-19 funds amounting to P67.32 billion.

Part of that P67.32 billion is the P42 billion funds transferred by DOH to PS-DBM, which then granted contracts worth P8.7 billion to Pharmally despite it having a small paid-up capital of P625,000.

READ: P8.7-B med supply deals went to tiny company 

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TAGS: Mohit Dargani, overpriced goods, Pharmally Pharmaceutical Corp., Philippine news updates, Procurement Service of the Department of Budget and Management, PS-DBM, Senate, Senate blue ribbon committee, Senator Franklin Drilon, Senator Risa Hontiveros
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