The Australian company Promedical, which would allegedly supply Apex General Contractors with the COVID-19 rapid testing kits for the Puerto Rican government, said it never did business or reached sales agreements with Apex or any other company or individual on the island.
A spokeswoman for Promedical told El Nuevo Día in written statements that Promedical has not held any conversation, nor has it signed any contract, with Apex General Contractors. Besides, the Australian company has not received any orders or payments from Apex General Contractors
"At the time, Promedical is working predominantly with both the Australian and U.S. federal governments to comply with COVID-19 rapid test sales contracts. The tests are being distributed according to instructions received and at the discretion of each government," the company added.
This Promedical spokeswoman said the company has neither done business nor had conversations with any of the people who have identified themselves in Puerto Rico as Apex executives. These are the owner Robert Rodríguez López, his attorney Juan Maldonado de Jesús, or entrepreneur Aaron Vick, who allegedly signed on behalf of Apex in the contract between the Emergency Management and Disaster Administration (NMEAD) and the company.
Vick told El Nuevo Día last week that he never had any relationship with Apex. He added that he did not sign any contract, nor did he authorize his signature to appear on the document.
Promedical, that said it had no contact with the local government either, added it sells its rapid testing kits for less than half the price that the construction company agreed with Puerto Rican authorities.
Without specifying the price, the Australian company's spokeswoman said, "Promedical sells its rapid tests to approved distributors for less than half the value identified by Apex General Contractors."
A large profit margin
On March 26, at the Health Department request, Apex signed a contract with NMEAD to sell one million rapid testing kits, at $38 each, for a total of $38 million.
Apex received $19 million in advance, according to the version offered by Promedical, the company could have covered the total cost of the products, which would mean that the remaining $19 million would represent only profit for the construction company.
The purchase order identifies Promedical as the company that would supply the tests to Apex, a small construction company that had never worked with medical products, but whose directors are very well connected in the high spheres of the New Progressive Party (PNP). Apex had received contracts before under PNP governments, but in the areas of construction, air conditioning installation and maintenance.
El Nuevo Día learned that two companies quoted lower prices than Apex, but members of the medical team advising Governor Wanda Vázquez Garced on the coronavirus emergency would have allegedly recommended the contracting of the construction company because it promised to bring the testing kits in five days, while the other two would do it in 10 days and each could import 500,000, instead of 1 million.
In the case of one of the two companies rejected, the proposal was $13 million cheaper than Apex, according to a source close to the negotiations.
Dr. Segundo Rodríguez Quilichini, coordinator of COVID-19 Medical Task Force defended the decision to refer Apex to Puerto Rican authorities for the purchase of coronavirus testing kits and invited anyone who has information of a crime related to the procedure to report it to the authorities.
"All information received about the possibility of acquiring the necessary tests to protect our citizens was immediately sent to the Health Department," the doctor said Monday in written statements. "In moments of emergency, time is a determining factor," he added.
Rodríguez Quilichini acknowledged that Maldonado de Jesús communicated with him via text message to offer the Task Force rapid testing kits and other health-related products.
The doctor warned that he does not know this Apex representative, but admitted that Maldonado de Jesús told him that he got his number through Eduardo "Tito" Laureano, whose company offers professional services to the University of Puerto Rico Medical Sciences Campus, where Rodríguez Quilichini is the dean.
Naed Consulting Group, a company Laureano represents, has contracts for $220,050 with the university campus. The contractor said he only provide Maldonado de Jesús with the dean's phone number.
Yesterday, during the House Health Committee investigative hearings on this contract, Rep. Mariel Rivera, a purchasing analyst for the Health Department, said Apex's purchase was made on the recommendation of the Task Force, which expressed its interest in increasing the number of tests as a measure to contain the spread of the virus.
However, the process of approving and processing the purchases is a responsibility of Puerto Rican government officials and not a task that can be delegated to these advisors.
Apex's contract said the shipment was to arrive in Puerto Rico by Tuesday, March 31. On April 1, without the shipment on the island, the government decided to cancel the order, which was done on Friday, April 3. NMEAD Commissioner José Burgos said he canceled the order because it did not arrive on time and because Apex executives had allegedly lied to him about the date the shipment would arrive.
Health Secretary Lorenzo González said the order was canceled because the tests did not have the authorization by the U.S. Food and Drug Administration (FDA) to be used in Puerto Rico.
However, both Promedical and scientific sources said the Australian tests did have FDA authorization to be used in Puerto Rico.
At a press conference, last Wednesday - the last time the governor answered questions from reporters - Vázquez Garced defended the government's contract with Apex and assured that it had been done following all regulations and good administrative practices. But during the press conference, she said she did not know how much Apex paid for the tests or why they had not been delivered.
Now, it was revealed that as part of the long bureaucratic process described by the governor in her press conference, no one noticed that the contract had an allegedly false signature and that the company to which the government gave an unusual advance of $19 million did not even have a preliminary agreement with its Australian counterpart.
This controversial transaction involved the departments of Health, Finance and Public Safety; NMEAD, the Office of Management and Budget (OMB), the General Services Administration (GSA) and members of the medical Task Force.
Vázquez Garced indicated that she was not aware of anything related to the transaction and was not involved in the negotiations.
Yesterday, La Fortaleza Press Secretary Mariana Cobián stated that according to the Executive branch memo on procedures for emergency purchases, emergency contracts are exempt from La Fortaleza's review. Usually, the Chief of Staff reviews contracts totaling such amounts.
Cobián added that each agency is responsible for the contracts and the emergency purchase process once they decide the purchase.
However, allegations by former interim Health Secretary Concepción Quiñones indicate that emergency purchases by the Health Department have been made "in coordination with La Fortaleza."
Requests for Information
Secretary González said Monday that FBI agents are investigating this transaction, examining computers and e-mail accounts. The FDA, the U.S. Department of Health and Human Services (HHS) inspector general, the Puerto Rico Justice Department, and the House are also investigating the transaction.
"People have come to ask for information regarding this whole process, not only from the Office of the Inspector General (HHS). Also from the FDA and the FBI. They have asked for information in many ways," González said.
The head of the Justice Department's Public Integrity Division, Phoebe Isales, said yesterday that the investigation is already underway and that she has indeed made requests for information from entities involved in this inquiry. She did not specify what documents and information she has requested, nor to whom or what entities she has made such requests.
The prosecutor said that it is not within Justice's jurisdiction to request to cancel payments related to the transactions that the agency is investigating. She did not specify which purchase processes are the object of the investigation but said they are investigating "everything" that has to do with the one that was referred to the agency.
She said that the cancellation, if necessary, would be handled by the Health Department.
Days after the purchase of the one million testing kits from Apex was canceled, it was revealed that Oriental Bank had canceled the company's accounts following the $19 million advance payment since the company had never handled such a large amount of money and the unusual transaction triggered internal security mechanisms.
Treasury Secretary Francisco Parés said Oriental Bank indicated it had asked Apex for information on the $19 million deposit, but that the information provided did not satisfy the entity. Oriental Bank also informed the government on Friday, April 3, that Apex had tried to move money to a bank in Colorado. It remains unknown whether the company tried to make the transaction that day or only received the notice from the bank. On April 4, Apex returned the money to the government of Puerto Rico.
Apex executives are no longer answering questions from the press on recommendations by their legal representatives. But their prior statements regarding their agreements with Promedical, radically contradicted what the company claimed in writing.
After the purchase order was canceled, Rodríguez López showed El Nuevo Día a promotional brochure from Promedical as the only proof of his negotiation with the Australian company and said the evidence "is available and if required, could be here in Puerto Rico."
"The supplier has the evidence and is willing to provide it if the opportunity arises," added Rodríguez, who is a regular PNP politicians donor. He added that he cannot give an exact date on when Promedical indicated it would reserve the testing kits for them. Rodríguez said that officials are aware that he got an emergency contract, a purchase order, and an advance payment. "They know that it is not a game on my part," he added.
Maldonado, a former Transportation and Public Works deputy secretary, and who in January 2019 was fired from his position as director of the Maritime Transportation Authority when a service boat was used to carry materials for a private wedding, said last week that after the order in Puerto Rico was canceled, he could sell the testing kits to other jurisdictions such as "Ohio or California."