The World Bank debarred a business unit of a Merck subsidiary Wednesday for 12 months for a “fraudulent practice” involving a health project in Bangladesh.
Institutional Family Planning Services Department (IFPSD), a business unit of Merck Sharp & Dohme B.V. (MSD B.V.), is ineligible to participate in World Bank-financed projects during the 12-month debarment.
The $360 million project was designed to help Bangladesh strengthen its health systems and improve its health services, particularly for the poor.
According to the World Bank, IFPSD failed to disclose the full commission amount that the Dutch predecessor of MSD B.V. — MSD Oss B.V. — had agreed to pay to its local agent in a contract to supply contraceptives through the project. MSD Oss B.V. ultimately won the contract.
MSD did not admit or deny culpability for the misconduct, the World Bank said.
The 12-month debarment is not eligible for cross debarment by other development banks. To be eligible for cross debarment, the duration must be more than a year.
A list of all World Bank debarred entities and individuals is here.
Harry Cassin is the publisher and editor of the FCPA Blog.