Office of the Ombudsman

The Office of the Ombudsman is set to file before the Sandiganbayan criminal charges against former Department of Budget and Management (DBM) Undersecretary Lloyd Christopher A. Lao, Overall Deputy Ombudsman Warren Rex H. Liong, DBM Procurement Management Officer Paul Jasper V. De Guzman, and five officials of Pharmally Pharmaceutical Corporation over the government’s procurement of P4.165 billion worth of Covid-19 test kits in 2020.

In an 87-page resolution signed last Aug. 18 by Ombudsman Samuel R. Martires, Lao, Liong, and De Guzman will be charged with violations of Section 3(e) of Republic Act No. 3019, the Anti-Graft and Corrupt Practices Act, together with Pharmally's Twinkle Dargani, Mohit Dargani, Linconn Ong, Justine Garado, and Huang Tzu Yen.

One graft charge will be filed against DBM Procurement Service Director IV Christine Marie L. Suntay, Procurement Management Officer V Webster Laurenana, employees August M. Ylagan and Jasonmer L. Uayan, and Pharmally's Krizle Grace Mago.

In a separate resolution, Ombudsman Martires found Lao, Liong, De Guzman, and Laurenana guilty of grave misconduct, gross neglect of duty, serious dishonesty, and conduct prejudicial to the best interest of the service.

They were imposed the penalty of dismissal from the service with forfeiture of all their retirement benefits and perpetual disqualification for re-employment in the government.

On the other hand, Ylagan, Uayan, and Suntay were found guilty of gross neglect of duty and conduct prejudicial to the best interest of the service. They were imposed the penalty of dismissal from service with forfeiture of all retirement benefits and perpetual disqualification for re-employment in the government service.

In the event that the penalty of dismissal can no longer be enforced, their penalty should be converted into a fine equivalent to their salary for one year, payable to the Office of the Ombudsman.

Meanwhile, Department of Health (DOH) Assistant Secretary for Health, Public Services Team Nestor F. Santiago was found guilty of simple neglect of duty and imposed a penalty of fine equivalent to one month of his salary.

The officials bought 8,000 units of BGI Real Time Fluorescent RT-PCR Kits priced at P600 million on April 23, 2020. The purchase was covered by Purchase Order No. PO20-00210-CSE. The next purchase was for 2,000 units of A*Star Fortitude RT-PCR Test Kits priced at P688 million covered by PO No. PO20-00211-CSE.

Also, 41,400 units of BGI Real Time Fluorescent RT-PCR Kits were purchased on June 9, 2020 for P2,877,300,000 covered by PO No. PO20-00286-CSE.

The Ombudsman questioned the financial capability of Pharmally to acquire test kits from foreign manufacturers or suppliers when it was awarded the P4.165 billion contract, especially since its paid-up capital was only P625,000.

The Ombudsman also found it "highly questionable" that Pharmally proposed prices for the 8,000 BGI Real Time Fluorescent RT-PCR Kits and the 2,000 units of A*Star Fortitude RT-PCR Test Kits on April 21, 2020 when the DOH requested for 7,000 BGI test kits and 1,900 A*Star test kits on April 22, 2020.

Moreover, the delivery of the 2,000 A*Star test kits should have started on May 1, 2020, but was rescheduled and further delayed by Pharmally to June 8, 2020 due to an incoming typhoon. Despite these delays, PS-DBM still awarded the company the purchase and delivery of 41,400 BGI test kits on June 8, 2020.

"Meaning, Pharmally was awarded with another contract while it has yet to complete, or start at least the delivery of the last contract. The inability to deliver on time should have been a red flag for PS-DBM to enter into another purchase contract, which notably involved a much bigger quantity," the resolution stated.