The police announced on Tuesday that 10 officials at CJ CheilJedang, a chaebol manufacturer of food and medicine, have allegedly given illegal kickbacks worth approximately 4.5 billion won ($4.2 million) to more than 200 doctors over two years from May 2000.
The kickbacks were allegedly offered in exchange for prescribing its product and were the form of lending the company credit cards to doctors. Some of the doctors used the company credit cards to purchase furniture and other commodities for use at home.
The office of the investigation team looking into pharmaceutical industry bribery in the Central District Prosecutors’ Office in Seoul. (Yonhap News)
The police were able to obtain evidence for the rebates by tracingthe company credit card.
CJ CheilJedang is not the only pharmaceutical company to be accused of engaging in illegal kickbacks.
Earlier this month, several former and incumbent executives at Donga Pharmaceutical Co., the nation’s largest drug manufacturer, were indicted by the prosecution on charges of offering rebates worth 4.8 billion won to doctors and hospital officials over the past several years.
Government investigations into the rebate practice intensified last year, as the long-running practice is known to drive up costs for patients and limit treatment options.
The Korea Medical Clinic Association, an organization of doctors, has called the government investigation “a conspiracy to make criminals out of doctors” in a press statement made available on its website.
The organization defended the doctors under investigation, saying that they received financial support “after being told that it was a legal practice.” It was the doctors who were duped by the pharmaceutical companies, the organization said, and considering how the doctors under investigation are those who operate private clinics, the investigation is an “attempt to cut off the tail” of a much larger incident for a cover-up.
By Samuel Songhoon Lee (email@example.com