A Filipino manufacturer of face masks told senators Tuesday that it lost money supplying government at a price that was lower compared to an importer that is linked to a former adviser of President Rodrigo Duterte.
EMS Components Assembly secured a supply contract for 100 million pieces of face masks at P13.50 per piece. On the other hand, Pharmally Pharmaceutical Corp, was awarded a similar contract for 12.9 million pieces of PPEs, with prices ranging from P22 to P27.72 per piece.
Ex-Duterte adviser Michael Yang, who was linked to Pharmally, snubbed the Senate hearing Tuesday, prompting senators to cite him in contempt and seek his arrest.
"Nalugi kami," EMS President Ferdinand Ferrer said. The company responded to the call of the Department of Trade and Industry for local companies to repurpose their factories to produce medical-grade face masks as the COVID-19 pandemic was starting, he said.
EMS delivered 25.8 million units at the contract price of P13.50 per face mask until November 2020. Ferrer said it received a letter from PS-DBM earlier this year that as part of its contract, EMS had to "match lower prices." The remaining 74.1 million pieces of face masks were still delivered but at a lower price of P2.35 per piece.
Ferrer also said that after the delivery of the first 25.8 million face masks, they were even asked to put their deliveries "on hold."
"Our deliveries were pushed out and delayed. The reasons were there was not enough space in the warehouse and they were doing inventory," he added.
Despite the lower price, Ferrer said they still fulfilled their contract, as what they have been doing for the past 17 years as a company offering electronics and semiconductor services.
"It is our duty as a Filipino company to contribute, and our supportive board of directors agreed to repurpose, retool a section of our company to produce medical-grade face mask," he said.
"One of our objectives really is to provide medical-grade PPEs including face masks as well as to be able preserve Filipino jobs and generate employment in the Philippines," he added.
Sen. Richard Gordon, who led the inquiry, lamented how EMS was "shortchanged" by the government.
"Nalugi yung Filipino corporation na nakipagsapalaran. Matira ang masiba ika nga," he said. "Lumalabas, hinikayat kayo at ibang korporasyon tapos bandang huli, tinira kayo, yung P13.50 niyo naging P2.35. Talagang nalugi kayo."
In response, former Budget USec. Lloyd Lao, who headed PS-DBM at that time, confirmed that they had an agreement with EMS to match prices when they drop. He said that in October, the DOH put a price freeze on face masks at P9 per piece.
"Kapag pinilit namin na P13.50, lagpas na kami sa price ceiling," Lao said, adding that they stopped procuring from other suppliers when they sealed the contract with EMS.
Gordon, however, said the fact remains that PS-DBM procured face masks from Pharmally at P27 per piece and that despite the lower price, the delivery of face masks from EMS was put on hold.
The Senate blue ribbon committee is set to continue their inquiry on Friday.