Novartis reaffirming integrity despite accusations

The multinational corporation (MNC), one of the largest pharmaceutical firms in the world in terms of sales and market capitalisation, has recently featured in numerous newspaper headlines globally, being repeatedly embroiled in scandals or compliance breaches in a number of countries including Greece, Turkey, and the United States.

The drug allegations and scandals have spurred ethical questions about the corporate culture of Novartis, which was named the number two company in the Global Access to Medicines Index 2018, a biannual survey of Access to Medicines Foundation, an independent non-profit organisation in the Netherlands.

Concurrently with the allegations, Novartis has been strongly expanding in Vietnam. Last December, it signed an MoU with the Ministry of Health with the aim of improving primary healthcare through commune- and district-level activities for the next two years. The following month, the giant inaugurated a new legal entity, Novartis Vietnam Co., Ltd., becoming one of the first such MNCs to transform into a foreign-invested importer, rather than simply holding a representative office in the country.

Roeland Roelofs, country president of Novartis Vietnam

In response to questions over similar allegations cropping up in Vietnam, Roeland Roelofs, country president of Novartis Vietnam, told VIR, “Integrity is one of the core values of Novartis. As a global company, we adhere to international and national laws and regulations. In Vietnam we are an active member of the EuroCham Pharma Group and we adhere to its Code of Ethics.”

The recent moves in Vietnam have been considered a testament to public-private collaboration in this area, despite many MNCs continuing to find it hard to join public-private partnership programmes and schemes in the local healthcare industry due to a lack of legal framework.

Furthermore, Novartis Pharma AG was named as one of two MNCs licensed to supply medicines and ingredients into Vietnam. Meanwhile, several tens of foreign-invested pharmaceutical companies are operating in the country.

Some experts have proposed that Vietnam investigates international pharma firms to see whether they are possibly involved in any similar breaches, in order to ensure fair competition and a healthy business climate.

According to foreign media, before CEO Vasant Narasimhan took over in 2018, Novartis faced a series of accusations and scandals worldwide. Bribery allegations in Eastern Europe and South Korea, price-fixing in Italy, and data-tampering in Japan were just some of the scandals on the list. And the recent Zolgensma data manipulation case became another blow for Novartis’ reputation.

Novartis has set aside $700 million to settle a long-running lawsuit alleging the drugmaker treated US doctors to lavish dinners and other events in return for boosting prescriptions. The case involved around 80,000 events Novartis held between 2002 and 2011 that federal prosecutors allege amounted to kickbacks masquerading as educational meetings.

A similar compliance deal was agreed in 2010, after Novartis paid $422 million to settle allegations that it marketed the epilepsy drug Trileptal and five other drugs for unauthorised use in the US, but the country’s Department of Justice claimed the company did not fully comply with the agreement.

In Greece, the corporation was involved in an alleged scandal involving ten former prime ministers and ministers from the New Democracy and PASOK parties taking bribes from the Swiss pharmaceutical giant, which was uncovered in 2018. In 2016, Novartis was investigated for $85 million bribery allegations in Turkey, while in 2015 the group paid $390 million to settle claims in the US related to allegations of kickbacks involving specialty pharmacy prescribing of Myfortic and Exjade, without admitting any liability.