Novartis global investigation uncovered bribery allegations in Greece

Novartis HQ in Basel - Wikipedia CC - Andrew- from Flickr - https://www.flickr.com/photos/americanidle/168419381/

The latest political turmoil in Greece has been triggered by allegations involving the pharmaceutical giant Novartis and alleged bribes to hospital staff and political persons.

Novartis, a multinational healthcare company based in Switzerland, is at the epicenter of a global investigation about alleged illegal payments to state officials which led to unfair competition practices and established its leading position in the market.

Since 2014, the U.S. Securities and Exchange Commission and the FBI have been investigating and discovering numerous company malpractices — allegedly applied in Greece as well. These malpractices include alleged bribes to politicians, state officials associated with the Ministry of Health, doctors and hospital staff. Doctors would allegedly promote and prescribe Novartis’ products which would sometimes cost much more than their competition.

In December 2016, Greek authorities launched a bribery probe into Swiss pharmaceutical company Novartis. In the midst of the on-going investigation, Greece’s justice minister claimed that Novartis may have bribed “thousands” of doctors and civil servants to promote its products

Global Voices.org quote media sources where it  said that Greece is  a country of special interest for Novartis; “the price of a product in Greece would influence its price worldwide. An increase of 10 cents in Greece would bring a 25 million profit for the company”.

Novartis had played a crucial role in promoting ophthalmologic and oncological drugs for cancer patients as well as high numbers of vaccines against the H1N1 flu virus with significant financial gain for the company.

Novartis has been the subject of five bribery and corruption enquiries the past three years.

  • In 2015, Novartis paid $390 million to settle charges that it bribed pharmacies in the U.S. to recommend certain prescriptions to patients.
  • In March 2016, Novartis paid $25 million to settle claims by the U.S. Securities and Exchange Commission that it bribed health professionals in China to increase sales.
  • In August 2016, Novartis came under scrutiny by Turkish authorities after an anonymous whistle-blower alleged that bribes were paid to win $85 million in business from government hospitals. To date those allegations remain unsubstantiated.
  • Also in August 2016, South Korea handed down indictments to six former or current Novartis employees over “rebates” offered to doctors to boost drug sales. The probe continued until April 2017 when, as the FCPA blog reported, South Korea fined Novartis $48.3 million over the kickbacks and suspended insurance coverage for several of the company’s drugs.

Novartis is just one of many Big Pharma companies to have faced bribery and corruption allegations in recent years. In 2012, Pfizer paid $60 million to settle charges in the U.S. that its overseas subsidiaries had bribed healthcare officials in order to gain regulatory approval for the company’s drugs and boost sales in 12 countries. In 2015, Bristol-Myers Squibb agreed to pay more than $14 million to settle charges of bribing state-owned hospitals in China in exchange for prescription sales. And 2016 saw the largest U.S. Foreign Corrupt Practices Act (FCPA) fine ever for a pharmaceutical company—and the fourth largest settlement across all industries—when Teva Pharmaceutical entered a deferred prosecution agreement for $519 million with the U.S. DOJ and SEC for FCPA offenses in Ukraine, Mexico and Russia.

Meanwhile, Switzerland’s Federal Office of Justice has confirmed it has received two requests for legal assistance from Greece and the United States in late 2017 and in January 2018 in connection with probes into the Novartis bribery case and that the requests  are being considered.

Sources: lexisnexis.com, news247.gr, globalvoices.org