Connecticut-based Alexion Pharmaceuticals, Inc. agreed to pay $21.4 million to resolve SEC charges that the company violated the FCPA by bribing foreign officials in Turkey and Russia, and failing to maintain accurate books and records at subsidiaries in Brazil and Colombia.
The SEC charged Alexion Thursday in an internal administrative order with violating the FCPA’s books and records and internal controls provisions.
Without admitting or denying the SEC’s findings, Alexion agreed to pay a $3.5 million penalty, plus $14.2 million in disgorgement and about $3.8 million in prejudgment interest.
The investigation started in 2015, according to the company’s earlier SEC filings.
In May this year, Alexion said it received a declination from the DOJ for the FCPA investigation.
In Turkey and Russia, Alexion paid government officials and doctors at state-connected hospitals to promote use of its blood-disease drug, Soliris.
Alexion retained a consultant in Turkey from 2010 to 2015 with ties to health officials. Alexion Turkey paid the consultant over $1.3 million for “consulting fees and purported expense reimbursements,” the SEC said. Alexion employees in Turkey “received limited training regarding anti-bribery compliance,” according to the the SEC order.
In Russia, Alexion paid doctors at government hospitals over $1 million from 2011 to 2015 to increase Soliris prescriptions. Alexion Russia recorded the payments as “honoraria, educational expenses, business meeting expenses, and scientific research.”
The bribery resulted in Alexion being “unjustly enriched” by about $6.6 million in Turkey and $7.5 million in Russia, the SEC said.
In Brazil and Colombia, the SEC said that from 2013 to 2015, certain employees at Alexion’s local units “created or directed third parties to create inaccurate financial records concerning payments to third parties, including patient advocacy organizations.” The subsidiaries didn’t retain relevant documents of some of the transactions and, in Brazil, allowed documents to be destroyed.
The SEC said Alexion cooperated in the investigation, took remedial measures, and strengthened its compliance program.
Here’s the SEC’s July 2, 2020 administrative order In the Matter of Alexion Pharmaceuticals, Inc.Alexion SEC order
Download the SEC order here.