On March 23, Novartis AG agreed to pay a $2 million penalty and $23 million in disgorgement and interest to resolve allegations that employees and agents doing business in China violated the books and records and internal controls provisions of the FCPA. According to the SEC's cease-and-desist order, between 2009 and 2013, employees of two Chinese Novartis subsidiaries, Sandoz China and Beijing Novartis Pharma Co Ltd. ("Novartis China"), boosted sales and prescriptions of their products by providing travel, entertainment, gifts and other improper forms of payment to doctors and healthcare professionals. They also used third-party travel and event planning vendors to facilitate the payments and fraudulently recorded these bribes as legitimate expenses. According to news sources citing an email statement from a Novartis spokesman, the allegations "largely predate[d] many of the compliancerelated measures introduced by Novartis across its global organization in recent years." The SEC said that Novartis also conducted its own comprehensive investigation into these matters and implemented accompanying remedial measures. See more information at Reuters and Bloomberg.
Separately, on March 30, Reuters reported that an anonymous whistleblower sent an email to Novartis leadership alleging that throughout 2013 and 2014, Novartis paid $290,000 in bribes via a consulting firm to procure $85 million in business benefits in Turkey. Novartis is investigating these claims, according to the news coverage.
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