Teva hit with record fine $519 million corruption fine
Teva Pharmaceuticals, the world’s largest generics company, has been hit with the largest criminal fine to come from the US government upon a pharmaceutical company. Teva is charged under violation of the US’s foreign-bribery law due to its practises in Russia, Ukraine and Mexico. The company has agreed to settle the case by paying a fine of $519 million. In addition to this, it will have to retain an outside corporate monitor for at least three years.
The charges originate from bribery allegations that came to light in 2012, with practises extending prior to this data. In Russia, Teva was accused of bribing an influential Russian government official to artificially increase sales of multiple-sclerosis treatment, Copaxone. Teva earned profits of $200 million on sales of the drug in Russia during this period. The company was keen to stress that none of the employees that were involved in this case are currently working for the company. It also restricted the leadership of the company’s presence in Russia in 2013.
In Mexico, Teva was accused of paying bribes directly to doctors employed by the Mexican government to ensure that Teva’s products were promoted from 2005 onwards. It was a similar case in Ukraine, where government officials were receiving kickbacks from 2001 to 2011.
“While the conduct that resulted in this investigation ended several years ago, it is both regrettable and unacceptable, and we are pleased to finally put this matter behind us,” said Erez Vigodman, Teva’s president and CEO. “Since becoming CEO, I have worked diligently to make our culture of compliance central to everything Teva does. The compliance program that Teva has in place is serious, rigorous, and comprehensive and is designed to protect the company and its subsidiaries against future violations.”
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