[A-List] Italy: pharma bribery scandal

["Michael Keaney" <michael.keaney@xxxxxx>]

British drugs giant in Italian bribery investigation

Sophie Arie in Rome
Thursday February 13, 2003
The Guardian

Italian prosecutors are investigating the giving of perks to Italian doctors
by the British pharmaceuticals giant GlaxoSmithKline allegedly in return for
prescribing more of their drugs.

Investigating police claim they have evidence of a nationwide "bribery
system" in which doctors allegedly prescribed 7-8% more Glaxo products each
year in return for "freebies" such as Caribbean trips, stereo systems and
wine.

In some cases, doctors received cash "gifts" ranging from £300 to £1,000,
said the investigating prosecutor, Guido Papalia, in the northern town of
Verona, where Glaxo has its Italian headquarters.

Glaxo played down the allegations. "We have a code of conduct and we try to
follow it as scrupulously as possible," said Giuseppe Recchia, the spokesman
for GlaxoSmithKline in Italy.

"Glaxo is a leader in the world pharmaceutical market. We do not need to do
anything here that we do not do in other European countries," Dr Recchia
said.

Dr Recchia said the company was awaiting further details of the allegations
from the Italian authorities, after financial police searched 48 offices of
its sales people throughout the country on February 7.

The police investigation is centred on communications between 30 doctors and
40 Glaxo salespeople between January 2001 and December 2002. Police say that
emails, documents and tapped phone calls they have collected suggest more
than 3,000 medical professionals may have been involved.

The investigators claim that ?100m (£66m) declared by Glaxo in June 2001 as
"investment to promote pharmaceuticals" was spent on free gifts - including
luxury travel - for Italian doctors and other medical professionals.

But Dr Recchia argued that "travel" was not a crime, and health
professionals had to attend international conferences to have the latest
information on pharmaceutical developments.

Glaxo faced similar allegations in Germany last March, over allegedly
offering perks such as free World Cup and formula one trips to thousands of
German doctors between 1997 and 1999. The company, the biggest drugs firm in
Europe, said at the time it would investigate the allegations internally and
Europe-wide.

The company said at the time that many positions had been redefined and
"responsibilities have changed" because of restructuring after Glaxo
Wellcome merged with SmithKline Beecham in 2000.

Glaxo Wellcome was also investigated in 1995, during an Italian crackdown on
corporate corruption, for allegedly bribing health ministry officials.

The head of the health ministry's pharmaceuticals department at the time,
Duilio Poggiolini, cited Glaxo among several leading pharmaceutical
companies which he claimed had paid bribes to secure a place in, and set
their prices on, the Italian market.