GlaxoSmithKline (GSK) will not be paying doctors to promote its pharmaceutical products through speeches following a corruption scandal in China that was disclosed earlier this year. It will also not make its sales force have individual sales targets any longer.
Chinese law enforcement has maintained that GSK transferred 3bn yuan ($489 million) to 700 travel agencies and consultancies to help bribe doctors. The Ministry of Public Security said GSK did so since 2007, and China detained four senior executives (all Chinese nationals) of the company in July of this year.
The company says its announcement about doctor payments for speeches and sales quotas are not related to the continuing corruption probe. They assert that the measures are part of a wider effort to improve transparency at the global firm.
‘These are designed to bring greater clarity and confidence that whenever we talk to a doctor, nurse or other prescriber, it is patients’ interests that always come first,” said Sir Andrew Witty, chief executive of GSK.
In addition to not paying doctors for making speeches promoting their products, GSK will end its payments to any healthcare professionals attending medical conferences.
GSK will implement a new system in which an independent entity, such as a university, could approach GSK for a grant to have a doctor attend a particular medical conference.
Paying doctors to make speeches and attend conferences is common in the pharmaceutical industry. There is a growing push for reform in this area, however.
In early November, healthcare giant Johnson & Johnson was forced to pay more than $2.2 billion to resolve criminal and civil claims from allegations of kickbacks to U.S. doctors and improper marketing claims about three prescription drugs. In 2010, Novartis agreed to pay $237.5 million to resolve civil allegations over kickbacks paid to doctors to prescribe Trileptal and five other drugs. Both cases involved speakers fees.
Dr. Vivienne Nathanson, head of science and ethics at the British Medical Association, applauded GSK’s new measures. ‘It is pleasing to see a large pharmaceutical company like GlaxoSmithKline recognise that it can reduce the possibility of undue influence by rewarding employees for providing high-quality information and education for doctors, rather than for their sales figures.’
Julie DiMauro is the executive editor of FCPA Blog and can be reached here.