"No Money to Pay Salaries"... Public Tissue Bank Selling Donated Human Tissues at Discount

Selling Human Tissue Grafts for Fascia, Joints, and More at a 40% Discount

An executive of a public tissue bank was found to have sold donated human tissues at a discount to a specific company. The photo is unrelated to the specific content of the article. [Image source=Pixabay]

[Asia Economy Reporter Park Hyun-joo] It has been reported that a public institution under the Ministry of Health and Welfare, which produces implant materials by receiving donated human tissues, sold the donated human tissues at a discount due to a lack of funds to pay employees' salaries.

According to a special audit report received by Kang Sun-woo, a member of the National Assembly's Health and Welfare Committee from the Democratic Party of Korea, from the Korea Public Tissue Bank on the 3rd, on November 20, 2020, Mr. A, who was serving as the Production and Distribution Manager and Head of the Management Support Division at the bank, signed an "intermediate material discounted price distribution contract" with company B, a human tissue research and development firm.

In this process, Mr. A sold human tissue implant materials such as fascia, joints, blood vessels, and bones, originally priced at approximately 366 million KRW, at about a 40% discount for 230 million KRW. In return, company B made an advance payment of 150 million KRW on November 25, about a month earlier than the scheduled delivery date of December 22. The remaining amount of approximately 80 million KRW was to be paid by the end of January the following year, but company B completed the payment two days after receiving the implant materials, on December 24.

This was revealed to be due to the institution's budget shortage. The audit found that the bank's account balance on November 24, 2020, when salaries were due on the 25th of each month, was only 25.79 million KRW, insufficient to pay employees' monthly wages.

According to the audit report, since the second half of 2020, the Korea Public Tissue Bank had been experiencing a shortage of funds for personnel expenses and reported the situation to the Ministry of Health and Welfare, requesting national treasury support or loans from financial institutions, but was told to resolve the issue internally. During the audit, Mr. A claimed that he had been delegated decision-making authority by the then bank president to proceed with such a contract.

This was uncovered during a special audit conducted after the inauguration of a new bank president, but since Mr. A, a non-regular employee, had already resigned, no separate disciplinary action was taken. Instead, the case was closed by establishing internal guidelines related to intermediate material distribution and setting up procedures for calculation, adjustment, and standard contract processes for distribution.

The audit also confirmed that bone powder implant materials used in artificial joint surgeries were lost and that six specific employees had their annual salaries arbitrarily increased without internal approval and subsequently refused to return the excess pay when requested.

This content was produced with the assistance of AI translation services.