The Novartis offices in Basel, Switzerland. Keystone / Georgios Kefalas
Swiss pharma company Novartis will pay $729 million (CHF688 million) to US authorities in an out-of-court settlement over various charges, including that the company bribed doctors to use its drugs.
Audrey Strauss, the acting Manhattan US Attorney, said the firm had paid out for “speaking fees, exorbitant meals, and top-shelf alcohol that were nothing more than bribes to get doctors across the country to prescribe Novartis’s drugs.”
Essentially, Novartis admitted to having organised thousands of lavish conferences and events ostensibly aimed at “further education”. Guest speakers were paid large amounts to attend.
In return, the doctors were incentivised to prescribe Novartis products, such as drugs for high blood pressure and diabetes, which were then reimbursed by state health authorities.
“Not only did Novartis incentivise doctors to host these speaking events, reps bribed the doctors to write more prescriptions of the company’s drugs to give Novartis an advantage over competitors within their field,” said William F Sweeney Jr, head of New York’s FBI office.
“Greed replaced the responsibility the public expects from those who practice medicine.”
As part of the agreement with US authorities, Novartis has signed a five-year code of good conduct. The Basel-based firm also said on Thursday that it was revising its methods of providing medical training, notably by planning more online webinars.
In a statement, Novartis CEO Vas Narasimhan said that the company had already changed (the charges in question were raised by a whistle-blower in 2011) and that it had “new leadership, a stronger culture, and a more comprehensive commitment to ethics”.
“With these agreements we mark an important milestone on our journey to build trust with society as we continue re-imagining medicine to improve and extend lives all around the world,” Narasimhan said.
A week ago Novartis and two of its subsidiaries admitted to further bribery schemes involving dealings in Vietnam and Greece, and agreed to pay some $347 million to settle US investigations.
As of Thursday, the stock market has not reacted particularly strongly: the Novartis share price dropped 0.8%, around the same as its competitor Roche.
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