Estrada: ‘Jedis, padawans’ boost drug firm’s profits

(INQUIRER) MANILA, Philippines — Thanks to “Jedis” and their “padawans,” the profits of a local drug distributor at the center of a supposedly anomalous marketing scheme steadily grew over the past years, Sen. Jinggoy Estrada said on Monday.

Delivering a privilege speech ahead of a Senate inquiry on the issue, Estrada said that Bell-Kenz Pharma Inc.—which is accused of recruiting doctors to invest in the company and prescribe their products through a reward system—used a marketing scheme that borrowed terms from the highly popular “Star Wars” films.

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According to the senator, the “core group” of the company was composed of physicians, mostly cardiologists, who called themselves “Jedis.” Their “downlines,” or the doctors they had recruited to join them, were called “padawans.”

In the Star Wars films, Jedis referred to guardians of peace and order who used the “Force” while their apprentices were called padawans.

Estrada, whose mother, former Sen. Loi Estrada, is a doctor, said that Bell-Kenz’s president and CEO Luis Raymond Go, and its treasurer, Dr. Jaime Cayetano Jr., are both Star Wars fans.

According to him, the Jedis in the firm’s marketing system received 8 percent in “rebates” or commissions if they hit the monthly minimum sales of P2 million. They also earned a “milestone point” for prescribing at least P2,700 of the firm’s products to their patients.

Milestone points

On the other hand, padawans were entitled to dividends, rebates and milestone points that could be exchanged for electronic gadgets, household items or foreign travel. Each milestone point was equivalent to P100.

Citing data from the Securities and Exchange Commission, Estrada said the pharmaceutical firm earned P5 billion in 2019, up from P1 billion just three years earlier.

In its annual financial report submitted to the SEC last year, Bell-Kenz reported a gross revenue of over P6.8 billion and a net income of nearly P312 million in 2022.

A year before, it reported a gross revenue of more than P5.6 billion and a net income of almost P245 million.

“This company … shamelessly recruits doctors, not medical representatives, into its fold, enticing them with promises of exorbitant commissions and lavish incentives in exchange for prescribing their medicines,” Estrada said.

“Under the guise of advancing medical science and improving patient outcomes, these doctors-turned-entrepreneurs exploit their positions of authority to promote and prescribe medications that may not necessarily be in the best interest of their patients,” he added.

Ethical standards violated

The practice, the senator argued, clearly violated ethical standards in the medical profession and the Mexico City Principles, an international code of business ethics that limited the interaction of doctors and pharmaceutical companies.

“The scheme is not only about making money, but also hurts the credibility and integrity of the medical profession. The doctors who engage in such unethical practices undermine public trust in health-care professionals,” Estrada said.

Sen. JV Ejercito, who first raised the issue last week, said he received information that some of the shareholders of Bell-Kenz were government doctors and officials of hospitals in the provinces.

“There were (government doctors) in the list (of investors),” he told reporters.

“That’s really conflict of interest, especially if there are government doctors involved because the government targets to lower the cost of out-of-pocket expenses of Filipinos,” he said.