Fair Trade Commission has slapped 500 million won ($440,000) in fines and issued a corrective order on Novartis Korea for illegally subsidizing expenses to attend overseas academic conferences by doctors who had prescribed its drugs.
The antitrust agency also brought a criminal charge against the local chapter of the multinational pharmaceutical company for similar reasons, FTC said Thursday.
According to FTC officials, Novartis Korea한국노바티스 supported expenses for doctors who had attended overseas academic conferences on 381 occasions from March 2011 to August 2016 with the total amounting to 7.6 billion won. The commission pointed out that the company violated fair competition rules in selecting the doctors.
Under the current regulations, when pharmaceutical companies support the fees for doctors, they had to provide payments to related associations after designating particular conferences. And the same rules do not allow drugmakers to make direct contributions to individuals who attend academic conferences.
Novartis Korea, however, had each of its business departments choose doctors and proposed them to make contributions while telling scholarly societies to select these doctors as the subjects for its support, the FTC officials said. Also, the company chose from among physicians who had prescribed its drugs more than those of other companies, or would likely do so in the future based on its criteria made through analyzing the company data, they added.
The commission emphasized the need for regulators not to allow drugmakers to exert influence on the selection of participants in international conferences. These academies also need to create a fund and provide subsidies to doctors selected through a transparent procedure, it also noted.
"The measure is meaningful in that it was the first disciplining and correction of pharmaceutical companies’ legal violations by using the support for participation in international conferences as the roundabout way of unfair sales promotion,” the FTC said. “We will continue to take similar measures to prevent companies from doing illegal activities through consultation with related organizations."
FTC plans to keep market monitoring and induce the industry to use their support for doctors who attend the overseas conferences as a tool to encourage academic activities in medical and pharmaceutical fields.
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