Six Novartis Korea Managers Indicted Over Illegal Payments to Doctors

ENLARGE

The Novartis headquarters in Basel, Switzerland. The Swiss pharmaceutical company expressed regret, but also said such conduct would not have been sanctioned by the “most senior management.” PHOTO: REUTERS

SEOUL—Prosecutors have indicted a former chief executive of the South Korean unit of Novartis and five other former and current managers over allegations they illegally paid doctors 2.6 billion won ($2.3 million) in return for prescribing the company’s drugs.

In response, the Swiss pharmaceutical company expressed regret through a statement, but said such conduct wouldn’t have been sanctioned by the “most senior management” at Novartis Korea.

“Novartis does not tolerate misconduct and we are already implementing a remediation plan in Korea based on the findings from our own investigation,” the Basel-based company said.

Paul Barrett, an official from Novartis International, said the company could provide no further detail on the case before the trial proceedings.

The executives indicted include former Novartis Korea chief executive Moon Hak-sun, according to prosecutors.

Mr. Barrett said Mr. Moon had agreed to take a temporary leave of absence in April. Novartis did not identify the other former and current executives charged and did not provide any contact details for Mr. Moon or his attorney.

The Seoul Western District Prosecutors’ Office said it also indicted 28 others, including 15 doctors and six publishers of medical journals, over their suspected involvement in transactions that took place between 2011 and January this year. None of the suspects has been arrested.

South Korean laws ban drug companies from providing doctors rebates or discounts for the drugs they prescribe.

—Copyright 2016 Associated Press