Villanueva questions Pharmally’s non-payment of gov’t-mandated contributions
Senator Joel Villanueva today raised red flags on signs that Pharmally Pharmaceutical Corp., which bagged tens of billions of COVID-19 supply contracts from the Philippine government, was a fly-by-night enterprise.
During his questioning at the resumption of hearings of the Senate blue ribbon committee on anomalies in government spending on COVID, Villanueva presented documents and data showing that Pharmally was not properly paying contributions to Social Security System (SSS), PhilHealth and Pag-Ibig Fund for its employees in 2020.
“It’s either you are fooling your employees or you are fooling the government or both. Unfortunately, these records would not lie. Mr. Chairman, I am just stating this, not only because of the fact that Pharmally only hired seven to 11 employees, but during this time, this committee emphasized the importance of hiring Filipinos first,” said Villanueva, chair of the Senate labor committee.
“In Bayanihan 2, the law that we passed, Mr. Chairman, malinaw po na dapat unahin dapat ang mga Pilipinong manggagawa. Doon sa statements ng Confederation of Wearable Exporters of the Philippines, nag-repurpose po sila. Ginawa nila lahat ng magagawa nila para maka-hire ng mga Pilipino. Ano po ang nangyari sa kanila noong 2020? They lost 25,000 jobs. Ang kapalit, ito po, hindi nag-cocontribute man lang sa mga government mandated contributions,” he continued.
“Indeed, they are not contributing to the government-mandated contributions, PhilHealth, SSS and Pag-Ibig,” Villanueva said as he presented records submitted to the Senate Blue Ribbon Committee. “Kapag hindi po nagcocontribute sa SSS, Philhealth at Pag-ibig, marka po iyan ng isang fly-by-night na kumpanya.”
“It’s either you are fooling your employees or you are fooling the government or both. Unfortunately, these records would not lie. Mr. Chairman, I am just stating this, not only because of the fact that Pharmally only hired seven to 11 employees, but during this time, this committee emphasized the importance of hiring Filipinos first.”
Citing document submissions to the committee, Villanueva said records at the SSS and Pag-Ibig showing that Pharmally was just paying contributions for membership of seven to 11 employees.
SSS wrote to the Blue Ribbon Committee on September 13, 2021 which says that Pharmally only started paying SSS contributions for its employees for the month of November 2020. Separate certifications from Philhealth dated September 10, 2021, and Pag-IBIG dated September 24, 2021 likewise showed that Pharmally started paying contributions of its employees starting November 2020 only.
Pharmally bagged up to P12 billion in contracts to supply the Philippine government with surgical masks, PPE sets and COVID testing kits that were found to be up to 100 percent more expensive than similar items from other companies.
It was found that Pharmally was just a middle man that earned from commissions and had no manufacturing operations.
The employment of a very lean staff by Pharmally despite being able to bag billions of pesos in contracts was a sign that its operations were fly-by-night, said Villanueva.
The company's 2020 audited financial statement showed that Pharmally paid P1.34 million in "employees' benefits" for the entire year, which Villanueva found questionable considering that the certifications from the SSS, PhilHealth, and Pag-ibig said the firm only started paying contributions beginning November 2020.