Drilon: Pharmally bagged 26% of P41.46-B fund for COVID-19 supplies

Pharmally Pharmaceutical Corporation bagged 26.39% or over P10 billion of the P41.46 billion government funds for the procurement of COVID-19 supplies, opposition Senator Franklin Drilon said on Thursday.

At the continuation of the Senate probe into the procurement of the medical supplies,  Drilon showed the summary of amounts that the Department of Budget and Management-Procurement Service obligated to the suppliers as of September 21, 2021.

“If you go through this, Pharmally Pharmaceutical Corporation grabbed 26.39 percent or delivery receipts amounting to P10,398,516,498,” Drilon said.

Apart from Pharmally, Drilon also showed the top 10 suppliers which got billions worth of funds from PS-DBM.

These include:

• Element Trade Limited;
• Sunwest Construction and Development Corp.;
• Xuzhou Construction Machinery Group;
• Hafid N’ Erasmus Corp., Phil Pharmawealth, Inc.;
• Mirzes PTE-LTD;
• Bowman Technologies, Inc., Chunsen Company Limited; and
• Nikka Trading.

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According to the summary, the PS-DBM had P39.397 billion in total delivery receipts of the P41.46 transferred funds from the Department of Health.

Drilon justified the scrutiny of the income tax returns (ITR) of the suppliers as he noticed the taxes due to the Bureau of Internal Revenue in 2020 which were withheld by the PS-DBM based on the Commission on Audit (COA) reports.

“What is worrisome about this, Mr. Chairman, is that in the [Commission on Audit] report of PS-DBM, what are the taxes due to the BIR withheld by the PS-DBM,” Drilon said.

According to Drilon, the COA report showed that the PS-DBM withheld taxes amounting to P75.6 million in 2020, the same year when there were purchases amounting to P39.9 billion.

“Therefore, we believe, we submit that there is basis for this committee to look into the income tax payments of these suppliers,” Drilon said

Drilon said he suspected that many of the listed suppliers had not filed proper income tax returns with the BIR.

“I suspect that many of these listed here would want to correct, given the opportunity in the income tax payments and here I would repeat out of all the purchases made by PS-DBM, only P98.1 million in taxes were remitted to the BIR [in 2019], and in 2020, only P75 million versus the purchases of almost 40 billion pesos,” Drilon said.

Last week, Drilon flagged the ITRs filed by PS-DBM suppliers, including Pharmally. He also questioned those of former presidential economic adviser Michael Yang and former Budget Undersecretary Christopher Lloyd Lao.

According to Drilon’s presentation, most of these companies and personalities neither filed their ITRs nor paid their proper taxes.

The Senate blue ribbon committee is looking into the transfer of P42 billion COVID-19 funds from the Department of Health to the PS-DBM.

This includes PS-DBM’s purchase of P8.6 billion worth of face masks, face shields, and PPEs from Pharmally Pharmaceutical Corporation, a firm that is being linked to Yang.

The company only had a P625,000 paid-up capital when it entered transactions with the government. -NB, GMA News