Balt Resolves $1.2 Million FCPA Enforcement Action
Earlier this month, the DOJ filed criminal charges against David Ferrera and Marc Tilman in connection with an alleged bribery scheme involving an alleged “foreign official” at Centre Hospitalier Universitaire de Reims, an alleged French state-owned and state-controlled public university hospital. (See here for the prior post).
Today, the DOJ returned to the same core allegations in announcing a $1.2 million Foreign Corrupt Practices Act enforcement action against Balt SAS (a medical device company headquartered in France). As stated in the DOJ release, Ferrera was an executive at Balt’s U.S. subsidiary and Tillman was hired by Balt’s U.S. subsidiary as a consultant.
Balt joins approximately 35 other companies not to contest the dubious FCPA enforcement theory that employees of certain foreign health care systems are “foreign officials” under the FCPA and thus occupy a status akin to a President or Prime Minister.
Time will tell if Ferrera and/or Tillman contest this enforcement theory as the previous post noted that the matter is believed to be the first DOJ individual FCPA enforcement action based on this theory.
The Largest FCPA Enforcement Actions Involving Healthcare Related Companies
In large part due to the expansive FCPA enforcement theory that physicians, lab personnel and others associated with most foreign healthcare systems are “foreign officials” under the FCPA (first brought to the FCPA context in 2002 – see here for the prior post), healthcare related companies have resolved numerous FCPA enforcement actions.
This post highlights the twenty largest FCPA enforcement actions (as measured by settlement amount) involving healthcare related companies (broadly speaking pharmaceutical, medical device, life sciences, and diagnostic companies as well as those selling health related products).
As indicated by the below list, the top three enforcement actions involve foreign companies.
Novartis Joins The Repeat Offender Club – This Time Paying Approximately $347 Million To Resolve An FCPA Enforcement Action
What happens when the Greek, Swiss, and South Korean subsidiaries of a Swiss company engage in improper conduct in Greece, Vietnam and South Korea? Why of course, approximately $345 million flows into the U.S. treasury.
Yesterday, Novartis joined the long and growing list of FCPA repeat offenders as the DOJ and SEC announced (see here and here) a combined approximate $347 million enforcement action. (As highlighted in this prior post, in 2016 Swiss pharmaceutical company Novartis coughed up $25 million to resolve a SEC FCPA enforcement action focused on the conduct of its indirect Chinese subsidiaries).
Yesterday’s enforcement action included a DOJ component (in which the company agreed to pay approximately $234 million) and a SEC component (in which the company agreed to pay approximately $113 million).
The Largest FCPA Enforcement Actions Involving Healthcare Related Companies
In large part due to the expansive FCPA enforcement theory that physicians, lab personnel and others associated with most foreign healthcare systems are “foreign officials” under the FCPA (first brought to the FCPA context in 2002 – see here for the prior post), healthcare related companies have resolved numerous FCPA enforcement actions.
This post highlights the twenty largest FCPA enforcement actions (as measured by settlement amount) involving healthcare related companies (broadly speaking pharmaceutical, medical device, life sciences, and diagnostic companies as well as those selling health related products).
As indicated by the below list, the top two enforcement actions involve foreign companies and four of the top ten enforcement actions involve foreign companies.
Commission Payments To Chinese Lab Personnel And Doctors Leads To Enforcement Action
[This post is part of a periodic series regarding “old” FCPA enforcement actions]
In 2005, the DOJ and SEC brought a coordinated enforcement action against Diagnostic Products Corp. (DPC – a California-based company which provided immunodiagnostic systems and immunochemistry kits) and its wholly-owned subsidiary DPC (Tianjin) Co. Ltd. (See here and here).
The conduct at issue focused on DPC Tianjin making cash commission payments to laboratory personnel and doctors employed by hospitals owned by the Chinese government to obtain and retain certain business involving the sale of immunodiagnostic systems, immunochemistry kits, and other medical equipment.
The overall settlement amount was approximately $4.8 million (a $2 million criminal fine and approximately $2.8 million in disgorgement and prejudgment interest paid to the SEC).