Novartis agrees to $642mn US settlement over kickbacks

Swiss pharmaceutical giant Novartis has agreed to pay more than $642 million to settle a lawsuit which accused it of paying kickbacks to doctors, among other allegations, the US Department of Justice said Wednesday.

Part of the settlement pertained to the company's use of three foundations to funnel payments to cover costs for patients taking its multiple sclerosis drug Gilenya and kidney cancer drug Afinitor.

Another part centered on the alleged bribing of doctors to prescribe the company's medication.

"Through this settlement and others, the government has demonstrated its commitment to ensuring that drug companies do not use kickbacks to influence the drugs prescribed by doctors or purchased by patients," Assistant Attorney General Jody Hunt said.

Novartis is accused of having hosted tens of thousands of speaker programs and events which the Department of Justice said were used to bribe physicians.

In one example, the company chose doctors who already prescribed high volumes of Novartis drugs to serve as paid speakers, as a means of inducing them to continue writing or write more prescriptions.

Representatives often dropped doctors from the speaker program if they failed to increase prescriptions, the Department of Justice said.

"For more than a decade, Novartis spent hundreds of millions of dollars on so-called speaker programs, including speaking fees, exorbitant meals and top-shelf alcohol that were nothing more than bribes to get doctors across the country to prescribe Novartis' drugs,” said acting US Attorney Audrey Strauss for the Southern District of New York.

The Department of Justice said the activity was the result of decisions made by top management at Novartis’ North American headquarters in New Jersey.

Under the settlement, Novartis will participate in a five-year corporate integrity agreement with the Department of Health and Human Services to address company conduct.