Pyramid

I shuddered going through a thick pile of documents detailing the operation of a pharmaceutical company incorporated by doctors. “This is worse than Pharmally,” a witness with knowledge of the enterprise described the scam.

The pharmaceutical company was incorporated in 2006. By every measure, this company is organized as a multi-level marketing scheme. Profits, presumably hefty, are shared “down-line.”

At the bottom, doctors who prescribe the company’s products are given “rebates.” At the top, the company’s founders receive a share from every drug prescribed by a large army of doctors involved in this scheme.

The “rebates” given to the foot soldiers at the bottom of the pyramid are not to be scoffed at. Apart from cash, they are handed out free plane tickets, expensive watches and luxury cars. In one hospital, according to one testimony, the doctors’ parking area is filled with cars of the same luxury brand generously given them by the pharmaceutical company.

From the day this company was organized, it crossed ethical lines. Doctors are not supposed to profit from the medicines they prescribe. This invites public health concerns. It could lead to over-medication or wrong prescriptions. The SEC should have been more vigilant in scrutinizing the papers of a pharmaceutical company owned by doctors.

Organized nationwide, this pharmaceutical company earns so much in sales that it falls within the compass of the BIR Large Taxpayers Unit – and that is only on the basis of the earnings they admit to. It could possibly involve, apart from the doctors who founded this company, hundreds of medical practitioners.

It turns out, from the documents I reviewed, that whistleblowers have complained to the Department of Health (DOH) about the modus operandi of this company. No action has been taken to date.

Needless to say, the medicines sold by this company cost more than their equivalent brands. Patients of doctors involved in this pyramid scheme, therefore, pay more for the medicines they need, regardless of efficacy. They are also advised to take other supplements sold by the same company regardless of whether they need them or not.

Having a business interest in a pharmaceutical company could color a doctor’s diagnosis. This is the reason why several international protocols have been adopted to prohibit physicians from having a pecuniary interest in the drugs they prescribe.

It is urgent that the DOH take action on this scheme. It is dangerous for all Filipino patients. It ought to be classified a crime – and not even a victimless one. This racket has not spared those who are both poor and sick.

A scheme like this one takes a heavy toll on our confidence in our own physicians. If we could not trust our doctors, who else might we trust?

According to testimonies of those familiar with the operation of this company, the group is in panic mode because they know information of the true nature of their operations have been leaked. They are frantically cleaning up their files and destroying financial records. The longer it takes for the DOH to act, the more thorough the culprits will be in covering tracks.

Enough evidence has been gathered. Affidavits have been sworn to and signed. It will only be a matter of time until all the gory details of this racket spills out to the public.

When it does, this will not be a happy story. It will be a lot more sordid a story if it involves not only tolerance on the part of the health establishment but complicity.

Public health is already dismal in this country. It is made worse by the unscrupulous who are so ready to blindside our regulations.

Red alert

The summer heat has become unbearable – so unbearable many schools have cancelled classes. It will be even more so if we are forced to endure rotating brownouts as some of our aging power plants conk out.

The National Grid Corporation recently issued yellow and red alerts in Luzon and the Visayas after 19 power plants shut down and three others are operating at reduced capacity. The alerts, however, were issued without fully educating the public about what each of us might be able to do to help alleviate the situation.

Fortunately, Meralco spokesman Joe Zaldarriaga took it upon himself to keep our citizens informed. Joe has been a trusted face on power issues and he manages to explain technical stuff in a manner ordinary Filipinos might understand.

A yellow alert, Joe tells us, is issued when our power reserves have thinned. When this happens, distribution utilities such as Meralco contact big commercial and power users to ask them to adopt the Interruptible Load Program (ILP). Under this program, large users switch on their generators to reduce demand pressure on the main grid. Using generators makes power more expensive for the big users, but the distribution utility somehow offsets their additional costs.

A red alert is issued when power supply falls below demand. The resulting power shortage is spread out by means of rotating brownouts.

Our power infrastructure only allows us scarce reserves. This will continue until new plants and renewable energy sources come on-stream and supply the grid. San Miguel’s battery plants will soon be able to store more power when demand is low to support peak usage.

Individual citizens may help the situation by being more prudent in our energy use. That adds up to relieve demand pressure on the grid.