Teva Slapped With Half a Billion Dollars Penalties in Bribery Case

YERUSHALAYIM -
Erez Vigodman, CEO of Teva Pharmaceutical Industries, speaking at a recent business conference. (Miriam Alster/Flash90)

Israeli drug-giant Teva will pay $519 million in criminal and administrative penalties for bribing foreign officials further its business interests in Russia, Ukraine and Mexico, U.S. officials announced on Thursday.

“Teva and its subsidiaries paid millions of dollars in bribes to government officials in various countries, and intentionally failed to implement a system of internal controls that would prevent bribery,” said assistant attorney general Leslie Caldwell.

While Teva’s Russian subsidiary pleaded guilty to one count of the Foreign Corrupt Practices Act, and the company has agreed to pay the penalties, chief executive Erez Vigodman nevertheless sought to put distance the company from the corrupt dealings:

“While the conduct that resulted in this investigation ended several years ago, it is both regrettable and unacceptable, and we are pleased to finally put this matter behind us,” said Vigodman. “The Teva of today is a fundamentally different company.”

Teva said it initiated an internal investigation after learning of corruption allegations in early 2012. The employees involved in the wrongdoing have since left the company, Teva said.

The case included bribes by Teva to a “high-ranking Russian government” official who used his authority to boost sales of the firm’s multiple sclerosis drug Copaxone, resulting in more than $200 million in profits for Teva and about $65 million for the Russian official between 2010 and 2012, the Justice Department said.

In Mexico, Teva’s subsidiary paid off doctors employed by the Mexican government since at leat 2005.