Sanofi Pays $25M to Resolve Corrupt Payments in Middle East
The Securities and Exchange Commission (SEC) on Tuesday announced that Paris-based pharmaceutical company Sanofi has agreed to pay more than $25 million to resolve charges that its Kazakhstan and Middle East subsidiaries paid foreign officials and health care professionals to improperly influence and increase sales of Sanofi products.In Kazakhstan, distributors were used as part of a kickback scheme to generate funds from which bribes were paid to officials to ensure that Sanofi was awarded tenders at public institutions. The kickbacks were tracked in internal spreadsheets where they were coded as “marzipans.”
“During the relevant period, tender sales increased by over 200 percent and included top selling products of Sanofi. The distributors involved in the conduct were some of the largest distributors by sales in Kazakhstan,” the order said.
In the Middle East, various pay-to-prescribe schemes were used to induce health care providers to increase their prescriptions of Sanofi products. In Iraq, a health care provider who received speaking, consulting and clinical trial service fees from Sanofi requested that the consulting and clinical trial fees be paid by check to an unrelated individual. Sanofi accommodated the request without question or justification.
“Bribery in connection with pharmaceutical sales remains as a significant problem despite numerous prior enforcement actions involving the industry and life sciences more generally,” said Charles Cain, FCPA Unit Chief, SEC Enforcement Division. “While bribery risk can impact any industry, this matter illustrates that more work needs to be done to address the particular risks posed in the pharmaceutical industry.”
Olivier Brandicourt, Sanofi’s CEO, said in a statement: "Sanofi requires all our employees to act with integrity and to follow the highest standards of conduct. We have worked diligently to strengthen our compliance program worldwide and we are pleased the DOJ and SEC recognized these efforts and our close cooperation.”
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