Novartis executives in South Korea face allegations of illegal rebates

14 August 2016 (Last Updated August 14th, 2016 18:30)

Seoul Western District Prosecutors' Office has charged Swiss pharmaceutical company Novartis executives in South Korea for offering illegal rebates to doctors.

Seoul Western District Prosecutors' Office has charged Swiss pharmaceutical company Novartis executives in South Korea for offering illegal rebates to doctors.

The company has confirmed media reports that six executives, including the president, from the South Korean arm of Novartis have been accused of providing $2.4m in illegal rebates since 2011.

Novartis was quoted by Reuters in a statement as saying: "Some associates supported travel to overseas congresses for some healthcare practitioners in a way that did not fully comply with self-regulation standards."

Though the Swiss company accepted the fraud, it rejected the accusation that the ‘alleged conduct was sanctioned by the most senior management of Novartis Korea’.

"A total of 34 people, including 15 doctors and the heads of five medical journals have been accused in the case, reported the Financial Times."

With the accusation, prosecutors have demanded that the South Korean Government needs to suspend the operations of the domestic unit of Novartis.

A total of 34 people, including 15 doctors and the heads of five medical journals have been accused in the case, reported the Financial Times.

According to the prosecutors of the Seoul Western District, the pharmaceutical company has offered such benefits to doctors who attended seminars conducted by the medical journals.

Seoul Ministry of Food and Drug Safety was quoted by Financial Times as saying: “We will take proper punitive measures against the company and people responsible, according to our regulations, after further investigations into the case.”

The country's health ministry has been urged by the prosecutors to cut down the prices of the involved Novartis drugs, which can be done directly through the national health insurance scheme.

The prosecutors have also asked to suspend the licences of the doctors who were allegedly involved in the fraud.