Heads must roll, says lawmaker over Pharmaniaga’s PN17 classification

An opposition lawmaker has taken issue with Pharmaniaga Bhd after the pharmaceutical company was classified as an affected listed issuer under Practice Note 17 (PN17) of Bursa Malaysia’s Main Market Listing Requirements.

Wan Ahmad Fayhsal Wan Ahmad Kamal (PN-Machang), while debating Budget 2023 that was tabled last Friday, said “heads must roll” following the classification.

He also zeroed in on other government-linked companies (GLCs), including Velesto Energy Bhd and Sapura Energy Bhd.

“Our GLCs are no longer competitive, unlike before,” said Wan Ahmad Fayhsal in the Dewan Rakyat this evening.

PN17 is issued by Bursa Malaysia, relating to companies that are in financial distress. Companies that fall within the definition of PN17 will need to submit their proposal to the Approving Authority to restructure and revive the company in order to maintain the listing status.

“In the 90s, Tambun (MP, Datuk Seri Anwar Ibrahim) used to criticise certain quarters for cronyism and nepotism, when not all from the group were parasites (of the economy) or rent seekers,” referring to the current prime minister who served as finance minister in the 90s, before he was sacked by then prime minister Tun Dr Mahathir Mohamad.

Dr Mahathir had been repeatedly accused of favouring certain businessmen who went on to build their empires during his first stint as prime minister.

“Some of them (the businessmen) were industrialists, pure entrepreneurs who were given assistance by the government to develop certain sectors.”

He said that this was no longer the case, adding that not all Malay entrepreneurs could go into strategic sectors due to their “high barrier to entry”.

Wan Fayhsal said certain industries like biotechnology and aerospace required massive funding and government assistance.

“The role of GLCs is important to ensure that developments planned by the government through Budget 2023 are carried out,” he said.

“Unfortunately, we have seen what has happened in recent days. Our GLCs are sick. How can Pharmaniaga, a GLC, make huge losses (at the height of the Covid-19 pandemic)?

“Heads must roll. Those running Pharmaniaga must be held responsible.

“This also includes a subsidiary of PNB, Velesto Energy, that lost its market cap. We also know that Sapura Energy is also going through the same thing.”

Oil and gas player Velesto Energy’s share price tumbled 31 per cent – from 27.5 sen to 19 sen a share yesterday. This led to RM697 million being wiped off its market capitalisation, on the back of a RM100.4 million net loss for its financial year that ended Dec 31, 2022.

Sapura Energy suffered massive losses in 2021 and is still resolving debt issues with its vendors.

Wan Fayhsal asked what was the government’s policy to help the “sick GLCs”?

“There is a ripple effect as many small businesses, including those owned by Bumiputera, are vendors to these GLCs.”

He said as such, there is a need to strengthen GLCs in the country.