US federal investigators probe drugmakers on bribery claims

The US Justice Department and the Securities and Exchange Commission are investigating whether pharmaceutical companies paid bribes in foreign countries to boost sales and accelerate approvals of their drugs, The Wall Street Journal reported Tuesday, citing sources familiar with the matter. To date, no drugmakers have been accused of wrongdoing and the investigation may not result in charges.
The Journal noted that investigators have sent letters to drugmakers identifying four types of possible violations of the Foreign Corrupt Practices Act, including bribing government-employed physicians to purchase drugs; paying company sales agents commissions that are passed along to government physicians; paying hospital committees to approve drug purchases; and paying regulators to obtain drug approvals.
Justice department officials also noted that the probe, which focuses on business conducted in Brazil, China, Germany, Italy, Poland, Russia and Saudi Arabia, could also include bribes made to government officials in the form of payment for travel, meals, entertainment or speaking fees.
In recent months, pharmaceutical companies, including AstraZeneca, Bristol-Myers Squibb, GlaxoSmithKline and Merck & Co., have disclosed that they are part of the probe. In addition, Eli Lilly and SciClone Pharmaceuticals confirmed that they have been subpoenaed in relation to marketing practices in Poland and China, respectively, and Baxter also confirmed that it is being investigated.
The Journal noted that the companies involved are cooperating with the government. However, a lawyer for one drugmaker noted that the industry has been somewhat confused because the recent requests were so broad. "If you don't have any specifics, a lot of this is just guesswork," the lawyer noted, adding that "everyone was running around to get in the door to meet with the government so they can better understand what the issues are."

Reference Articles
Drugmakers probed on global bribery allegations, WSJ reports - (Bloomberg)
Pharmas probed over foreign bribery allegations - (Daily Finance)
Drug firms face bribery probe (free preview) - (The Wall Street Journal)

**Published in "First Word"