The Justice Department has accused Novartis’ US unit of offering opulent dinners and paying physicians as an enticement to prescribe its drugs.
The government’s lawsuit names several venues where the exchange of medical information allegedly took place, but where it “would have been virtually impossible for any presentation to be made.”
Novartis claimed its speaker programs are “promotional programs” designed to inform physicians about appropriate use of medicines. It also took issue with allegations in a case filed by the US government alleging Novartis incentivized pharmacies to switch transplant patients from competitor drugs to a Novartis product, Myfortic.
“We disagree with the way the government is characterizing our conduct in both of these matters,” said the president of Novartis’ US pharmaceuticals unit, André Wyss, in a statement.
According to Novartis data cited in the complaint, from January 2002 through November 2011, the firm spent nearly $65 million and held more than 38,000 speaker programs for just three drugs: hypertension drugs Lotrel and Valturna and diabetes drug Starlix.
The government said the company was lax in ensuring that the programs were for a legitimate purpose. Its complaint alleges these events “were often little or nothing more than social occasions for the doctors.”
In many cases, the payments to doctors were for speaker programs that either did not occur at all or had few attendees, the complaint charges. “Thousands of programs occurred where few or no slides were shown,” and participants spent little or no time discussing the drug at hand, the government argues.
Novartis told MM&M the investigation was first disclosed in its 2011 full-year results press release in January 2012. Its 2012 20-F, filed with the SEC in January of this year, notes that its US subsidiary Novartis Pharmaceuticals Corp. (NPC) received a subpoena from the US Attorney’s Office requesting the production of documents relating to marketing practices. It said the company is cooperating with the investigation, “which is civil and criminal in nature.”