Travel Agency Abuse, Falsified Expense Reports and Other Hospitality Blunders Lead to $25 Million Novartis Settlement

In the fourth similar settlement in the last six months, pharmaceutical giant Novartis has agreed to pay $25 million to settle SEC charges that it violated the books and records and internal controls provisions of the FCPA by bribing foreign officials. “The Novartis case is essentially the GSK case, with fewer zeroes and headlines,” Amy Sommers, a partner in K&L Gates’ Shanghai office, told The FCPA Report. Indeed, the scheme underlying Novartis’ troubles is familiar – employees and agents of the company’s Chinese subsidiaries provided travel, gifts and entertainment to health care providers to encourage sales of Novartis’ products. “The Novartis case appears to have arisen by virtue of inquiries made by the SEC in the wake of reporting about the GSK case in 2013,” Sommers explained. See also our coverage of the SciClone, PTC and Bristol Myers Squibb settlements.

To read the full article

Continue reading your article with an ACR subscription.