After twenty hours of debate, the Greek Parliament has approved the creation of a committee to investigate accusations that Novartis, a Swiss pharmaceutical company, bribed at least ten high-level politicians. The investigation will now hold separate and secret votes on whether each of the ten involved politicians should be investigated. The list of politicians includes two former Prime Ministers, as well as the current central bank governor. The parliamentary commission follows a report in which Greek prosecutors found evidence that Novartis paid politicians and doctors to increase their access to the Greek market, and fix prices at artificially high levels.
The prosecutors’ report is primarily based on testimony from three anonymous whistleblowers, who claim the bribes happened from 2006 through 2015, including during Greece’s worst austerity measures. The current Prime Minister, Alexis Tsipras, called this one of the biggest scandals in the country’s modern history” and said “Those who enriched themselves from human pain must suffer the consequences.” Eight of the politicians involved represent three separate, and often competing, political parties. The remaining two are unaligned. All ten have denied the allegations, and some have tried to sue the whistleblowers.
Under Greek law, politicians cannot be directly prosecuted. A case must first be referred to parliament, and Parliament must strip immunity before a criminal action can move forward. The Parliamentary investigation is expected to last around a month, but is further complicated because the statute of limitations has expired for many of the allegations in the case.
In the past three years, Novartis has been investigated for bribery in Turkey, China, and South Korea. The South Korean probe resulted in six indictments being issued to Novartis employees, as well as a $48M settlement. The company has also faced legal troubles in the United States. In October 2016, Novartis settled allegations it encouraged the off-label prescription of Elidel skin cream for the treatment of eczema in children younger than two, despite the lack of FDA approval for such use. The settlement amount was $35M. In November 2015, Novartis settled a FCA suit for $390M and resolved allegations that it violated the Stark Law and Anti-Kickback Statute by giving kickbacks to specialty pharmacies in return for recommending Exjade, an iron chelation drug, and Myfortic, an anti-rejection drug for kidney transplant recipients. The company also paid a $25M settlement to the SEC for FCPA violations involving payments to Chinese health professions in exchange for increased sales.
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