After four years of investigations, Teva Pharmaceuticals is setting aside about $520 million in hopes of settling allegations of paying bribes in Russia, Mexico and Ukraine.
The drug maker had disclosed an internal investigation last year after finding business practices that were likely violations of the Foreign Corrupt Practices Act. Teva then began its probe after receiving subpoenas and other requests for information from the US Securities and Exchange Commission and the US Department of Justice Department in 2012
In its latest earnings report released on Tuesday, the drug maker noted that “advanced discussions” are under way with the feds to resolve the incidents, which took place between 2007 and 2013. Since then, Teva claims to have ended “problematic” business relationships, firing employees, overhauling management at some subsidiaries and ending operations in several countries.
Before the internal probe began, however, there was squabbling over procedures, according to a lawsuit filed last year by a former Teva employee. Keisha Hall, who worked as a certified fraud examiner and director of finance for Latin America, claimed she was later fired for disagreeing with supervisors and helping US officials with their investigation. Her case, however, was recently dismissed and Teva is seeking more than $26,000 in costs.
Teva is hardly the only drug maker to confront penalties for violating the Foreign Corrupt Practices Act.
Recently, GlaxoSmithKline paid $20 million to settle a bribery scheme in China, and AstraZeneca paid $5.5 million to settle charges of bribing doctors in Russia and China. Over the past year, Bristol-Myers Squibb settled charges of bribing doctors in China for $14 million. SciClone Pharmaceuticals agreed to pay $12.8 million to settle an SEC investigation into potential violations. In 2012, Eli Lilly agreed paid more than $29 million to settle charges of bribing foreign government officials to win business in several countries. And five years ago Johnson & Johnson paid $70 million to resolve FCPA violations.
Novartis also paid a $25 million for bribing doctors in China. Meanwhile, the drug maker also faces a bribery probe in Turkey and, three months ago, six former and current executives at its Korean unit were indicted on charges of paying more than $2 million to doctors in return for prescribing its medicines. Among them was the chief executive in the country.