MANILA, Philippines (Updated 5:54 p.m.) — Pharmally International Holding Company executives and a business associate of Michael Yang — a former economic adviser to the president — are wanted in Taiwan for financial crimes, Sen. Risa Hontiveros said Wednesday.
This comes as its subsidiary Pharmally Pharmaceutical Corp. fields controversy in the Philippines over its bagging of the largest pandemic contracts with the government worth a total of P8.68 billion, edging out more established firms despite being incorporated only in September 2019 with a paid-up capital of P625,000.
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The holding company's chairman, Huang Wen Lie, also known as Tony Huang, is wanted in Taiwan for securities fraud, embezzlement, and stock manipulation, Hontiveros told Senate media in a presentation that included news clippings and entries from Taiwan's Ministry of Justice website.
Huang was among the Pharmally executives who met with Duterte in 2017 as seen in a video posted by state media.
His son, Huang Tzu Yen, incorporator of Pharmally Pharmaceutical Corp and Pharmally Biological Inc. is wanted in Taiwan for stock manipulation. Included in Hontiveros' presentation was a copy of a warrant for Huang's arrest taken from the same justice ministry website.
It details that Taiwanese authorities have been looking for Huang Tzu Yen as early as December 29, 2020. Hontiveros said that despite the outstanding warrant, the Philippine government's latest purchase from Pharmally was in June 2021.
"Why is this government transacting with fugitives?" she asked.
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Yang associate linked to Pharmally, also wanted for alleged financial crime
Meanwhile, a certain Zheng Bingqiang is wanted for alleged involvement with the elder Huang's stock manipulation. Hontiveros also showed Senate media a copy of the warrant for his arrest.
The senator said Zheng is a close business associate of former Duterte adviser Yang, presenting news reports which identify him as chairman of Xiamen Full Win Group of Companies. Yang, also identified Yang Hong Min, sits as chairman of the company's local counterpart, Philippine Full Win Group of Companies.
Hontiveros also presented a photo of Duterte with both Yang and Zheng from his visit to China in 2015. Zheng also attended the meeting between Duterte and Pharmally executives at Davao City in 2017.
The senator noted that other incorporators of Pharmally, such as Rose Lin and Gerald Cruz, are also directors of the Full Win company.
"Considering that Zheng Bingquiang is involved [with Pharmally] as shown in the warrant of arrest we showed earlier, this means that President Duterte has been interacting with Pharmally since 2015," Hontiveros said. "And of course, there's that video of Duterte meeting Pharmally officials in 2017."
"Is there more to this story than what the president is leading us to believe?"
Yang was among the individuals whom Duterte defended in a recorded address aired Tuesday morning where he again lambasted senators for probing the "deficiencies" in the spending of pandemic funds first flagged by state auditors.
He also defended former Budget Undersecretary Lloyd Christopher Lao who was officer-in-charge of the department's procurement service when it first awarded the controversial pandemic contracts to Pharmally.
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"Anong masama kung magbayad ako ng utang (What's wrong if I pay my debts)?" Duterte said then.
"I repeat: Why is our administration doing business with wanted fugitives? They have a warrant of arrest and are being looked for in other countries, but when they come here to the Philippines, they bag a billion-dollar contract?" Hontiveros said in Filipino.
"Parang hindi naman yata tama yan (That does not seem right)."
Palace: No issue since goods were delivered
Malacañang meanwhile defended the deal, saying the company was able to deliver the supplies needed by the government.
Presidential spokesman Harry Roque claimed Pharmally's small paid-up capital is not an issue.
"Despite the fact that the initial paid-up capital is P625,000, they were able to deliver... Perhaps if they failed to deliver, you can complain and ask why it was awarded to a company with no resources," Roque said at a press briefing.
"But all the PPE (personal protective equipment) we needed to save lives actually arrived and were used. I don't think that's an issue," he added.
Roque, however, noted that the procurement was made under the Bayanihan to Heal as One Act, which gave the president the power to undertake procurement of COVID-19 response supplies in the "most expeditious manner."
"Perhaps if it were a regular bidding, there would be a disqualification on the basis of the requirements on the size of the company. But here, the basis really is the quality, the specification of the government, the price and date of delivery," the Palace spokesman added.
No influence?
Asked about the role of Yang — described recently by Duterte as a 'pagador' or payroll master — in the transactions, Roque said personalities had nothing to do with the purchase.
"Well, ultimately, it’s the price and the specification that matters. The competition is about the price, no matter who you are. Unfortunately, no other company can supply (PPEs) at P1,700 each," Roque said.
"Personalities have nothing to do with it. The prices and the quality were considered," he added.
However, a notice of award issued by the budget department's procurement service on May 6, 2020, showed that each PPE purchased from Pharmally costs P1,919 each. The government purchased two million units of PPEs for a total cost of P3.82 billion.
National Task Force Against COVID-19 chief implementer Carlito Galvez, Jr. said Duterte's directive at the time was to acquire the PPEs within two to three days because of the rising number of healthcare workers dying of COVID-19.
He said officials had sought the assistance of Chinese Ambassador Huang Xilian in looking for a manufacturer who can deliver the supplies. Two C-130 military cargo planes and a Navy ship were then sent to China to pick up the PPEs.
"So, the involvement of the person we call Michael...I believe our only involvement there is basically we, including (former budget) Undersecretary Lloyd (Lao) and what we call the Task Group Resource Management Cluster, we dictated on how we will procure and acquire our PPEs at that time," Galvez said.
"Our objective is to save lives not to make money. (The allegations are) very callous. Our (aim is to ) save our healthcare workers. Thirty-seven doctors and nurses died that time and ten others were intubated. And then hospitals are pleading with us that's why we need that volume immediately," he added.
'Allowed by law'
Roque noted that under the 'Bayanihan 1' law, the president may procure goods including PPEs, supplies, laboratory equipment, medical equipment, and devices as the need arises in the "most expeditious manner" as exemptions from the Government Procurement Act.
The Government Procurement Act, meanwhile, allows emergency negotiated procurement "in case of imminent danger to life or property during a state of calamity or when there is the essence arising from natural or man-made calamities," he added.
"That's why we declared a state of calamity because of the pandemic and if there is an emergency, we can have negotiated procurement, procurement of goods, infrastructure projects and consulting services whereby the procuring entity directly negotiates a contract and with technically legal and financially capable suppliers," Roque said.
"But even if we have that, we still proceeded and asked for quotes to acquire the lowest priced PPEs and the PS-DBM (Procurement Service-Department of Budget and Management) then found PPEs worth P1,700. Is this overpriced? No, because during that time, all countries are looking for PPEs," he added. — with The STAR/Alexis Romero