Senators discover another undercapitalized firm that got P7-B in govt contracts

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There is another “another favored supplier” that got nearly P7 billion in contracts from the government but is “undercapitalized,” according to senators.

This, as the Senate blue ribbon committee continued to probe Pharmally Pharmaceutical Corp. for bagging more than P8 billion in Covid-19 response supply contracts but only had a paid-up capital of P625,000.

During Thursday’s Senate blue ribbon committee hearing on Pharmally, Senator Francis Pangilinan said that, according to records from the Procurement Service of the Department of Budget and Management (PS-DBM), a company that was undercapitalized called Element Trading Limited was awarded around P6.98 billion worth of government contracts.

“The data submitted to us by DBM-PS will show that Element that delivered about P7 billion worth of purchases (for) DBM-PS had a capitalization of $10,000,” Pangilinan said.

“Again, the first one had a capitalization of P625,000: Pharmally. Now you have a second company with P7 billion worth of contracts with $10,000 capitalization so clearly, the record will show that undercapitalized suppliers, corporations were able to bag billions of pesos worth of contracts,” he added.

Records showed that Element was incorporated only in April 20, or just as the Covid-19 pandemic started.

Former PS-DBM head Christopher Lao was questioned by Senator Richard Gordon over the matter.

“There is another preferred supplier, is that correct?” he asked Lao.

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