The Fair Trade Commission fined six pharmaceutical companies a total of 11 billion won ($10.3 million) for giving money or gifts to hospitals and doctors to increase sales of their medicines, the agency said yesterday.The six companies are Janssen Korea, Sanofi-Aventis Korea, Novartis Korea, Bayer Korea, AstraZeneca Korea and CJ Cheiljedang.
According to the agency, from August 2006 to March 2009, the companies sponsored seminars and lectures, offered marketing surveys and provided gifts and free rounds of golf in order to boost sales.
“Rather than directly paying cash or gift certificates, they provided rebates through more devious tactics such as paying for lectures,” said Kim Joon-ha, whose job at the agency involves tracking figures in the manufacturing industry.
“What is significant is that even large multinational companies do this, not just local companies.”
One of the companies allegedly invited doctors and their families to a seminar in July 2007, but the six-day event consisted mostly of spa treatments and other forms of entertainment.
Another company paid 10 million won for a seminar in which doctors and their wives were invited. In return, the doctors made subscription orders for the company’s medicines worth 200 million won.
Janssen was slapped with the biggest fine of 2.6 billion won for offering rebates for five medicines including Pariet, an ulcer medicine. Novartis was ordered to pay 2.4 billion won for using such rebates to promote and sell Dioban and five more of its medicines.
Sanofi-Aventis got a 2.3 billion won fine, followed by Bayer (1.6 billion won) AstraZeneca (1.5 billion won) and CJ (655 million won).
The government has maintained its tough stance on rebates in the pharmaceutical industry but has been unable to stamp the practice out completely as companies resort to increasingly creative methods.
One of the companies - no names were provided for the specific cases - had four doctors give perfunctory lectures based on materials it provided and paid them several million won each for their services.
The event was held at a hotel in front of a small audience, with doctors who were considered important for medicine sales selected to give the lecture.
The government said this practice causes medical costs to rise and shifts the burden onto patients and the national health insurance system, which covers 70 percent of the cost of their medicine. It said rebates are believed to account for between 10 percent and 30 percent of pharmaceutical companies’ sales.
By Limb Jae-un [jbiz91@joongang.co.kr]
Sunday, September 04, 2011
Crackdown on rebates to doctors - INSIDE Korea JoongAng Daily
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