E. Supplier's certificate, AID Form 280 (Reverse), signed by Ernest LOWENS, President, June 16, 1965 F. Invoice-and-Contract Abstract, AID Form 280 (Obverse), covering ocean freight G. Supplier's certificate, AID Form 280 covering ocean freight, signed June 15, 1965, for MOORE-McCORMACK (Navegacao) S.A. (illegible) H. Bill of lading No. 4 of MOORE-MCCORMACK (Navegacao) S.A. dated June 15, 1965 V. Bureau Voucher 5602156 for $26,975.54 paid at New York, N.Y., August 6, 1964 A. Supplier's invoice No. 5894/V-107 dated July 9, 1964 to PHARMACIE MY PHAU, Saigon, F.O.B. Santos $5,010.00; freight to Saigon $95.73; CIF $5,105.73 B. Supplier's certificate of source and origin dated July 9, 1964 C. Supplier's certificate of compliance with special provisions of letter of credit, dated July 9, 1964 D. Invoice-and-Contract Abstract, AID Form 280 (Obverse), covering “pharmaceutical products" E. Supplier's certificate, AID Form 280 (Reverse) signed by Ernest LOWENS F. Invoice-and-Contract Abstract, AID Form 280 (Obverse) covering ocean freight G. Supplier's certificate, AID Form 280 (Reverse) covering ocean freight, signed July 9, 1964, for MOORE-MCCORMACK (Navegacao) S.A. (illegible) H. Bill of lading No. 02 of MOORE-McCORMACK (Navegacao) S.A. dated July 9, 1964 At Sao Paulo, Brazil ORGANIZATION OF RICHTER OF BRAZIL On December 13, 1965, the reporting Inspector and Inspector Peter P. Hoehl visited the plant of Ormonoterapia Richter Do Brazil, S.A., Sao Bernardo Do Campo (S.PL), Via Anchieta, Km 13.5, and interviewed Mr. Dante GADDI, Controller, through the medium of Mr. Francesco COPPOLA, Marketing Director, acting as interpreter. According to Messrs. GADDI and COPPOLA, the Brazilian firm was founded in 1953 as part of a world-wide pharmaceutical manufacturing organization under the administrative control of ORMONOTERAPIA RICHTER, Milan, Italy. Financial control of the RICHTER complex, they said, is vested in a Swiss holding company known as NAHOR HOLDING, A.G., which maintains offices in Zurich. The latter firm owns sixty-two percent of the stock of RICHTER of Brazil, the remainder of the shares being held by various Brazilian and Italian interests. Mr. GADDI said his company is under the complete domination of RICHTER of Milan, with respect to both administrative control and production methods. A sample of each batch of a pharmaceutical preparation must be sent to the parent firm for analysis and approval before it can be released. Frequent plant inspections are held to maintain quality standards at prescribed levels. All export shipments to Vietnam are invoiced to GEDEON RICHTER PHARMACEUTICAL PRODUCTS, INC., New York, N.Y. to be trans-shipped to ultimate consignees. DESCRIPTION OF PRODUCTS Mr. GADDI listed six pharmaceutical preparations, which he said are the only products shipped to Vietnam, and made the following comments on each: 1. Pancortin B6, B3: The product is packed in boxes of three ampules of one cubic centimeter (c.c) each. Each ampule contains the following ingredients: (a) Extract os supra-renal cortex equivalent to 100 milligrams (mg.) of hidrocortisona, derived from fresh cow or pig kidneys of Brazilian origin. (b) Fifty mg. of Vitamin B6 purchased from Roche or Merck in Brazil. (c) One mg. of benzoic acid purchased from Usina Columbiana, Sao Paulo, Brazil. (d) Nine mgs, of sodium chloride (table salt). (e) One tenth c.c. of ethyl alcohol of Brazilian origin. (f) One c.c. of distilled water. 2. Pancortion B6, B3 (Pediatric): Packed in boxes of three ampules of one c.c. each. Contains the same ingredients, all of Brazilian origin, as described above, with the following quantitative differences: (a) Hidrocortiacon-70 mg. (b) Vitamin B6-20 mg. 3. Rubrohenar B Complex, B5 plus 5 The product consists of one 2 c.c. ampule of quick frozen Vitamin B complex, plus one 2 c.c. ampule of liver extract which is used as a solvent. Immediately prior to use, the contents of the two vials are mixed. All ingredients are purchased in Brazil. Vitamin B is derived from fresh beef livers. 4. Cortiplex B5 plus 5 (Intramuscular) Packed in boxes of five amples of quick-frozen vitamins plus five vials of natural adrenocortical extract to be used as a solvent. Contents of the two containers are mixed prior to use. Each ampule contains: Sodium pantothen-10 mgs. The vitamin ingredients are derived from fresh animal organs of Brazilian origin (B), or from locally grown citrus fruits (C). Cocarboxylase is purchased from the Merck Company in Brazil, which manufactures the product locally, supplementing its stock at times through imports from its parent company in Germany. Mr. Gaddi said he was aware of the AID ruling restricting ineligible source ingredients to ten per cent of F.O.B. values, but felt that he was in compliance by virtue of his procurement of the item from a local vendor, irrespective of possible German origin of a part of the substance. He said any portion of cocarboxylase which Merck may have obtained from Germany would be commingled with the locally produced substance and the identities of each would be lost. 5. Cortiplex B3 plus 3 (Intravenous) This product contains the same ingredients as the intramuscular preparation, but in the following proportions per ampule : Vitamin C-200 mgs. Sodium Pantothen-20 mgs. 6. Atini B5 plus 5 Packed in boxes of five ampules containing quick-frozen adenozine-triphosphoric acid (A.T.P.)—a natural component of cellular nuclei; plus five vials of double-distilled water used as a solvent. The contents of the two containers are mixed prior to use. A.T.P. is purchased exclusively from the Schwartz Bio Research Company, Orangeburg, New York. 7. Adenoplex B5 plus 5 Packed in boxes of five ampules of the medication plus five vials of a solvent. The medication has the following composition per ampule in a porous, dryfrozen mass: A.T.P.-5 mgs. Cocarboxylase-20 mgs. Vitamin B12-100 mcgms. (1/10 mg.) Nicotinamide (Vitamin PP)-10 mgs. The preparation is also made in a more concentrated form, packed three ampules to the box, with three vials of solvent having the following composition per ampule of medication: A.T.P.-10 mgs. Co-carboxylase: 50 mgs. Vitamin B12-500 mcgms. (2 mg.) Nicotinamide-20 mgs. The Vitamins B12 and PP used in these preparations are purchased from the Roche Company in Brazil and are of local origin. OVERPRICING Mr. Gaddi stated that in accordance with the instructions issued by Richter of Milan, all shipments to Vietnam are invoiced to Gideon Richter of New York, who then re-invoices them to the Vietnamese customers. He made available a carbon copy of Invoice No. 120,899 of July 8, 1865 (Exhibit VI) and Invoice No. 120,899-A of the same date (Exhibit VII), showing F.O.B. Santos prices of each of the items discussed above. Mr. Gaddi said these prices are controlled by Brazilian law and cannot exceed published domestic prices. Both Gaddi and Copolla denied any knowledge of prices charges by Gideon Richter of New York. Since Richter is the only plant in Brazil which manufacturers preparations of the above specifications, the prices shown on the company's invoices constitute the offical domestic and export prices for the country. The following tabulation shows F.O.B. prices at the port of Santos as shown by the Brazil invoices and as compared to the New York invoices, and the percentage of mark-up taken by the New York supplier: 1. Will obtain copies of GEDEON RICHTER's purchase invoices covering all AID financed shipments originating in plant of INSTITUTO DO ANGELI DO BRASIL, Sao Paulo, Brazil. 2. Will review correspondence betweeen GEDEON RICHTER (NY) and ORMONOTERAPIA RICHTER (Milan) concerning AID financed shipments originating in Brazil and Portugal, for evidence of intent to defraud AID through overpricing and false certification. At Sao Paulo, Brazil Will examine records of INSTITUTO DO ANGELI, Al Dos Quinimuras 187, (telephone 7-3430; 7-2895) Sao Paulo, to verify Brazilian origin of products shipped under AID financing by GEDEON RICHTER (NY) out of INSTITUTO DO ANGELI plant at Sao Paulo. At Lisbon, Portugal MIS/FRANKFURT Will make an examination of the records of INSTITUTO LUSO-FARMACO, Rua Do Quelhas, 8 for the purpose of verification that the pharmaceutical products mentioned in this Report were manufactured in Portugal; were mined, grown or produced in a country or countries covered by AID geographic code 901 and that the cost of components (delivered to the point of production) acquired by ILF of the commodity in the form in which imported into the country of production from the free world countries other than the countries covered by AID geographic code 901 does not exceed in total cost 10% of GRP's export price FOB. * GEDEON RICHTER PHARMACEUTICAL PRODUCTS, INC., CERTIFICATION ON SOURCE AND ORIGIN (AS PER STIPULATIONS IN AID L/CREDIT) Inv. No. 5936/V-136 Re: L/C AID 417.961-CMB L/C-E-503.877 PA or PIO AID NO. 430/470/901/421/4290 Letter of Commitment: 430-S-4651 Our Ref. RNY-EXP. 64-3901 LT/1-ICA/13 We hereby certify that the "source" (as defined by AID) of the commodities listed on the attached invoice is as shown below and in the source block of the AID Packed in boxes of three ampules of one c.c. each. Contains the same ingredients, all of Brazilian origin, as described above, with the following quantitative differences: (a) Hidrocortiacon-70 mg. (b) Vitamin B6-20 mg. 3. Rubrohenar B Complex, B5 plus 5 The product consists of one 2 c.c. ampule of quick frozen Vitamin B complex, plus one 2 c.c. ampule of liver extract which is used as a solvent. Immediately prior to use, the contents of the two vials are mixed. All ingredients are purchased in Brazil. Vitamin B is derived from fresh beef livers. 4. Cortiplex B5 plus 5 (Intramuscular) Packed in boxes of five amples of quick-frozen vitamins plus five vials of natural adrenocortical extract to be used as a solvent. Contents of the two containers are mixed prior to use. Each ampule contains: Sodium pantothen-10 mgs. The vitamin ingredients are derived from fresh animal organs of Brazilian origin (B), or from locally grown citrus fruits (C). Cocarboxylase is purchased from the Merck Company in Brazil, which manufactures the product locally, supplementing its stock at times through imports from its parent company in Germany. Mr. Gaddi said he was aware of the AID ruling restricting ineligible source ingredients to ten per cent of F.O.B. values, but felt that he was in compliance by virtue of his procurement of the item from a local vendor, irrespective of possible German origin of a part of the substance. He said any portion of cocarboxylase which Merck may have obtained from Germany would be commingled with the locally produced substance and the identities of each would be lost. 5. Cortiplex B3 plus 3 (Intravenous) This product contains the same ingredients as the intramuscular preparation, but in the following proportions per ampule: Vitamin C-200 mgs. Sodium Pantothen-20 mgs. 6. Atini B5 plus 5 Packed in boxes of five ampules containing quick-frozen adenozine-triphosphoric acid (A.T.P.)-a natural component of cellular nuclei; plus five vials of double-distilled water used as a solvent. The contents of the two containers are mixed prior to use. A.T.P. is purchased exclusively from the Schwartz Bio Research Company, Orangeburg, New York. 7. Adenoplex B5 plus 5 Packed in boxes of five ampules of the medication plus five vials of a solvent. The medication has the following composition per ampule in a porous, dryfrozen mass: A.T.P.-5 mgs. Cocarboxylase-20 mgs. Vitamin B12-100 mcgms. (1/10 mg.) Nicotinamide (Vitamin PP)-10 mgs. The preparation is also made in a more concentrated form, packed three ampules to the box, with three vials of solvent having the following composition per ampule of medication: A.T.P.-10 mgs. Co-carboxylase: 50 mgs. Vitamin B12-500 mcgms. (1⁄2 mg.) Nicotinamide-20 mgs. The Vitamins B12 and PP used in these preparations are purchased from the Roche Company in Brazil and are of local origin. OVERPRICING Mr. Gaddi stated that in accordance with the instructions issued by Richter of Milan, all shipments to Vietnam are invoiced to Gideon Richter of New York, who then re-invoices them to the Vietnamese customers. He made available a carbon copy of Invoice No. 120,899 of July 8, 1865 (Exhibit VI) and Invoice No. 120,899-A of the same date (Exhibit VII), showing F.O.B. Santos prices of each of the items discussed above. Mr. Gaddi said these prices are controlled by Brazilian law and cannot exceed published domestic prices. Both Gaddi and Copolla denied any knowledge of prices charges by Gideon Richter of New York. Since Richter is the only plant in Brazil which manufacturers preparations of the above specifications, the prices shown on the company's invoices constitute the offical domestic and export prices for the country. The following tabulation shows F.O.B. prices at the port of Santos as shown by the Brazil invoices and as compared to the New York invoices, and the percentage of mark-up taken by the New York supplier: 1. Will obtain copies of GEDEON RICHTER's purchase invoices covering all AID financed shipments originating in plant of INSTITUTO DO ANGELI DO BRASIL, Sao Paulo, Brazil. 2. Will review correspondence betweeen GEDEON RICHTER (NY) and ORMONOTERAPIA RICHTER (Milan) concerning AID financed shipments originating in Brazil and Portugal, for evidence of intent to defraud AID through overpricing and false certification. At Sao Paulo, Brazil Will examine records of INSTITUTO DO ANGELI, Al Dos Quinimuras 187, (telephone 7-3430; 7-2895) Sao Paulo, to verify Brazilian origin of products shipped under AID financing by GEDEON RICHTER (NY) out of INSTITUTO DO ANGELI plant at Sao Paulo. At Lisbon, Portugal MIS/FRANKFURT Will make an examination of the records of INSTITUTO LUSO-FARMACO, Rua Do Quelhas, 8 for the purpose of verification that the pharmaceutical products mentioned in this Report were manufactured in Portugal; were mined, grown or produced in a country or countries covered by AID geographic code 901 and that the cost of components (delivered to the point of production) acquired by ILF of the commodity in the form in which imported into the country of production from the free world countries other than the countries covered by AID geographic code 901 does not exceed in total cost 10% of GRP's export price FOB. GEDEON RICHTER PHARMACEUTICAL PRODUCTS, INC., CERTIFICATION ON SOURCE AND ORIGIN (AS PER STIPULATIONS IN AID L/CREDIT) Inv. No. 5936/V-136 Re: L/C AID 417.961-CMB L/C-E-503.877 PA or PIO AID NO. 430/470/901/421/4290 Letter of Commitment: 430-S-4651 Our Ref. RNY-EXP. 64–3901 LT/1-ICA/13 We hereby certify that the "source" (as defined by AID) of the commodities listed on the attached invoice is as shown below and in the source block of the AID |