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PPE, medical suppliers tagged in ‘overpricing’ claims deny allegations

The medical equipment supply firms tagged in the alleged overpriced procurement by the Department of Budget and Management (DBM) denied the allegations of irregularities and attested that the government’s purchase of medical supplies was above board.

In separate letters and statements, PPE and medical equipment suppliers XuZhou Construction Machinery Group Imp. and Exp. Co. Ltd., Integrated Energy Systems and Resources Inc., Lifeline Diagnostics Supplies Inc., and Hafid N’ Erasmus Corp. (HNE) responded to the claims made against them.

Hongzhi Han of XuZhou Construction Machinery Group, said that the products the company supplied to the Philippines were of good quality.

“It is baseless and irresponsible accusation that quality is inferior and overpriced. Our prices are cheap and the same as what was offered to other countries such as the USA, Canada, Australia, Germany, Brazil, Indonesia, South Africa and others,” Hongzhi said in a statement.

Meanwhile, Hafid N’ Erasmus (HNE) said that their PS-DBM medical grade suits were “far more price-competitive” than what other suppliers offered between March and June, or at the height of the COVID-19 pandemic.

“The high price of the PPEs during the periods of March to June 2020 was due to the high demand in the market which are obviously experienced worldwide,” HNE said.

The company added that it decided to build its own manufacturing plants in Parañaque City and Carmona, Laguna to produce locally made cover-all, washable face masks, aprons and other non-woven medical products.

“HNE is now one of the major local suppliers of PPEs for private and public hospital health workers,” it said.

For his part, Rex Tiri, president and chairman of Lifeline Diagnostics, also denied his company’s involvement in the alleged overpriced Macherey-Nagel Nucleospin extraction kits, noting that they followed all government procurement procurement processes.

Tiri said that Lifeline Diagnostics was invited by PS-DBM to submit a price offer to the government’s purchase of COVID-19 testing kits, which they initially declined.

He said they initially opted not to participate in the bidding “because there was no assurance from our manufacturers that we can deliver the goods” amid high global demand for COVID-19 testing kits and disruption in the supply chain due to lockdowns.

“We could have just sold to private customers only as there was so much demand at the time and we can even get better terms,” Tiri said in his letter to PS-DBM dated September 16, 2020.

“But since we are the exclusive and no other company can offer the products locally, we opted to participate because we wanted to help in the government’s efforts to increase the testing,” he added.

Tiri said that his company is willing to open its record to any investigation, as “our records will speak for itself that we have one price to all government and private customers.”

“We are confident that there is no single transaction that our price is higher in government compared to private hospitals/laboratories because of our uniform pricing,” Tiri said. “We can prove that.”

For her part, Susan Tecson, Integrated Energy Systems and Resources managing director, said the company delivered “low-cost” but “high quality” medical supplies that passed the standards of the Research Institute for Tropical Medicine (RITM) and Department of Health (DOH).

Tecson said that being an authorized distributor and direct importer of GenFollower Biotech Co.’s filter tips, and HBH Biotechnology Ltd.’s transport medium, the firm was able to offer PS-DBM medical supplies at a much lower cost.

She added that Integrated Energy Systems and Resources also enjoys a preferential tariff of up to 5 percent for imports coming from China due to the ASEAN-China Free Trade agreement that effectively lowered their prices.

“Furthermore, due to the large volume of your requirement, we were able to haggle the price of the proposed items. Considering the above, we were able to propose a very competitive price compared to other bidders,” Tecson said in her letter to PS-DBM dated September 16, 2020.

Senator Risa Hontiveros earlier claimed that the government lost around P1 billion when the DBM’s Procurement Service (PS-DBM) purchased China-made PPE sets that were overpriced.

The senator said the cheapest PPE sets procured by the PS-DBM, priced at P1,700 each, were from Philippine-based company Hafid N’ Erasmus Corporation, but she pointed out that only 30,000 sets were bought from this firm.

Hontiveros also alleged that almost three million PPE sets were outsourced at higher prices from Chinese companies including Xuzhou Const. Machinery Group; Wen Hua Dev’t Industrial Co., Ltd.; Chushen Company Ltd.; Pacific Field (Hong Kong) Ltd.; and Shanghai Puheng Medical Equipment Co. Ltd.

Senate Minority Leader Franklin Drilon, on the other hand, flagged the “bloated” purchase of Macherey-Nagel Nucleospin RNA virus preps kit from Lifeline Diagnostics Supplies, Inc.

The government bought the kits at P108,304 each or a total of P73.1 million for 675 units, Drilon said, noting that private sector could buy it for only P47,199 each.

The PS-DBM has since denied the allegations of overpricing as it claimed that the government, instead, saved P800 million when it purchased China-made PPEs. — DVM, GMA News