Pharmasave A story has just appeared on the CBC Go Public site alleging that Canadian pharmacy company, Pharmasave, is running a scam to defraud Health Canada. An employee came forward and agreed to be interviewed by Erica Johnson on condition of anonymity. Johnson managed to reach out and secure two other sources within the Pharmasave chain, all from different outlets in different provinces, each corroborating the same story. Apparently, the pharmacies record prescriptions that were never actually filled for customers. Health Canada refunds the pharmacies for these prescriptions, and then each of the participating outlets makes use of a forensic accountant, a “cleaner” who is paid to go through their records, making adjustments so everything appears normal and the fraud can’t be detected. To complicate matters, one of the sources said in the interview that it’s common practice among a particular group of these drugstore owners. What they have in common are networking events hosted by the Chinese Business Chamber of Canada (CBCC). Allegedly, the accountant “cleaner” is also part of that circle. So far no formal allegation of wrong-doing has been made outside of this news story, but the story is starting to trend on social media and patient advocacy groups are taking notice. The Chronic Pain Association of Canada contacted the Pharmasave CEO through email asking for comment, while the Cancer Advocacy Coalition of Canada issued a statement on its website. Though the piece has so far not been picked up by mainstream media, and although it doesn’t name Pharmasave, it does argue that pharmacy fraud ends up hurting the people who need medication, because it drains government funding and causes costs to increase. This is particularly acute with vulnerable sectors of society (in Ontario, for instance, the Ontario Drug Benefit program provides free or near free medication for the elderly and those on social assistance, a program which becomes hard to sustain with losses due to fraud). Johnson’s article also included brief commentary from an economist who said, “If the story is true it would certainly raise concerns about Pharmasave’s progressive business model.” To that a reader in the comment section replied, “No actual corporate governance but a lot of corporate salaries. Very innovative.” Pharmasave’s VP of Regulatory has a contact in Health Canada who told him there is sufficient interest now for an investigation to be mounted. Supporting such action would be politically prudent for Health Canada, which is facing pressure from Innovative Medicines Canada to crack down on unethical practices from generic brands. Pharmasave does not produce any drugs, though it has an over-the-counter house brand for other products. The implication, though, is that Pharmasave pharmacists push the generics over the brand name versions of similar pharmaceuticals. Pharmaceutical companies are always competing with generic drug manufacturers who can produce a similar drug as soon as the pharmaceutical company’s patent expires. Because they don’t invest in discovery research, these generic companies can make their drugs far more affordable. Health Canada is supposed to treat both groups equally but the implication over the years has been that they favor generics, which keep the cost of reimbursement down. The cheaper the drug, the less the government has to pay to cover it for patients. Furthermore, the Liberal government’s universal pharmacare platform is based on arguments of cost-savings. Launching an investigation into Pharmasave wouldn’t speak directly to this conflict, but it would demonstrate that the government does in fact watch and regulate the pharmacy industry. The Pharmasave VP of Regulatory, like other top officers of the company including the CEO, has no doubt this story is genuine. They ran across this practice two years ago when an employee complained internally. The head office confronted the store owner, who has since sold his business. The company executive hoped that it was an isolated case and similar problems could be handled internally. Plan International Canada The Chair of the Board of Plan International Canada (PIC) took a disturbing phone call from Marco Chown Oved—if Oved is contacting you, it’s not good news. The point of the call was to invite her to voluntarily provide disclosure of any wrong doing before a story appeared in the mainstream media. Often journalists will make such a call simply as a courtesy before they publish a story. The Chair had nothing to say, and some of what Oved told her she knew already. A video was recovered as part of a child pornography crack-down conducted by joint task forces from the RCMP and local police agencies. Police analysis came to the conclusion the video was shot on an iphone and in India. The video shows a middle-aged man engaged in a sex act with an underage girl. The girl’s face is covered and she cannot be identified. The man’s face is not visible in the video, which shows him only from the torso down, but his voice is recorded. Canadian authorities reached out to counterparts in India and after months of investigation a possible lead emerged. Delhi officials had testimony from a procurer in the sex trade who claims he dealt with a Canadian who worked with a charity. Following the lead, police eventually interviewed the CEO and other senior management of Plan International Canada. A portion of the audio from the video was played. None of the people interviewed said they could identify the voice. Nothing further happened for months, but during further investigation of suspects caught during the crackdown, police were able to determine how the video was distributed. That line of inquiry led to two Canadian citizens connected with Plan International Canada. Both were arrested. One of these men is the husband of the CEO. When interviewed by police a second time, following this discovery, employees reiterated that they could not identify the voice. However, Oved claims an employee told him that PIC personnel were cautioned not to say anything that would endanger the “Because I am a girl” campaign. The CEO has resigned. According to her email to staff she did so voluntarily so she could devote more time to supporting her husband, who is denying the charge. A separate organization which evaluates charities, Charity Intelligence Canada (Ci), refused to comment on the case to Oved, and denied they falsely reported Plan International Canada’s spending breakdown. Ci remains completely impartial, the spokesperson said. They are not influenced or coerced by any organization they report on. Their reporting on PIC shows a lackluster cent-to-cause ratio, and a track-record of not reporting campaign budgets, but nothing else. Oved, however, claims his informant in PIC provided him with emails sent from the VP of Finance which strongly suggest financial malfeasance. Over a period of three years the VP of Donor Marketing was reimbursed for expenses he submitted involving travel, accommodation, and associated costs while in India. This is inexplicable, though, because his duties should be keeping him in Canada where he works to secure donors. He is not directly involved in the administration of causes. The VP of Donor Marketing, however, is the other of the two Canadians arrested in connection with the video. He is charged with the production and distribution of the video. So far the story hasn’t gone public. The arrests and resignation haven’t been picked up by either social or mainstream media, although clearly Oved is about to publish a bombshell. there are two components of this exercise, asking team members to take positions on alternate sides of the corporation-media interface, first as corporate communicators defending a company, then as reporters interrogating a company. Part 1: I) Hosting a Media Scrum (400 words for each case) You have issued a media advisory and the webinar is now full of journalists eager to cover this story. Host this session as a corporate communication team. Each member of your team must contribute in part to the following: 1) Welcome guests and position the company. This is your chance to frame the best representation of the company, its reputation and accomplishments. This has to feel authentic, not like a stock company profile. Use whatever devices (anecdote, cases, examples) will help. Prove visual aids if/when appropriate. 2) Briefly overview the current situation, providing key objective facts. Do not overly message at this point, which will look evasive. 3) Provide a clear response communication. What is the company doing or going to do in the face of this issue/crisis? Are they guilty and if so how and to what degree? Frame the situation according to your crisis communication strategy. Make sure that you stick to your key messages in question period as well. Part 2 II) Answer questions (400 words for each case) You will play a role as a host and a media member First you will make question as a host then answer your question as a media member Note to hosts: Consider what might be asked in advance. Prepare yourself for likely questions. Have a set of key messages in mind. Consider also what other surprise findings or unexpected concerns a reporter might bring to the question period. Note to media members: Look at the scenario for the company you are interrogating. Be aware of anything they are not mentioning in their presentation. Additionally, when you act as a reporter, watch for great quotes (in other words, missteps). Exploit any indecisiveness or evasiveness. It is your job to get the best story possible. If you hear something explosive you can use in a news story write it down. 
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