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Six drug makers fined W11b for illegal rebates

Sept. 4, 2011 - 19:25 By
The Fair Trade Commission said Sunday that it has fined five multinational drugmakers and one local firm a total of 11 billion won ($10 million) for illegal rebate activities.

The financial and non-financial benefits given in return for prescriptions and drug orders between August 2006 and March 2009 amounted to 53 billion won, the antitrust watchdog said.

Sponsoring meals or drinking parties for doctors or pharmacists made up the largest cases of illegal marketing activities with the total amount reaching 34.9 billion won.

Companies also offered 10.8 billion won as fees for lectures or consultation. They selected doctors who had been favorable toward their products regardless of their expertise.

“International companies were found to have been involved in illegal trading following the prevalent practices among local companies,” said Kim Joon-ha, an FTC official.

The largest amount of fines was imposed on Janssen Korea with 2.55 billion won, followed by Novartis Korea with 2.35 billion won and Sanofi-Aventis Korea with 2.3 billion won. CJ CheilJedang, a local firm, was fined with 655 million won.

According to the antitrust watchdog, pharmaceutical sales in Korea reached 10.54 trillion won in 2006. Drugmakers here are estimated to spend 10 to 30 percent of their sales on illegal rebates.

By Lee Ji-yoon (jylee@heraldcorp.com)