Novartis, Alcon pay $347 million to settle bribery probes

Federal authorities say Novartis and its former eye-care unit, Alcon, agreed to pay a combined $347 million to resolve allegations that the companies ran schemes to bribe public hospitals and clinics in Greece, Vietnam, and South Korea.

Federal authorities say Novartis and its former eye-care unit, Alcon, agreed to pay a combined $347 million to resolve allegations that the companies ran schemes to bribe public hospitals and clinics in Greece, Vietnam, and South Korea. The settlements bring to a close investigations by the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) into alleged criminal and civil violations of the Foreign Corrupt Practices Act. The entities accused of the misconduct entered into deferred prosecution agreements with DOJ to resolve the criminal charges, which were filed in the U.S. District Court in New Jersey. Meanwhile, Novartis' parent company entered into a separate agreement with SEC to resolve the regulator's civil claims, which also covered allegations that the company and its former subsidiary used falsified contracts as part of financing arrangements in China that led to the writing off of more than $50 million in bad debt. In Vietnam, a scheme reportedly aimed to increase the sale of artificial lenses used to treat cataracts and other eye diseases. The distributor was reimbursed for up to 50% of the cost of the corrupt payments, which were recorded as consulting, marketing, and human resource expenses, among other things. The Greece-based Novartis business agreed to pay a criminal penalty of $225 million.