March 1, 2012 / 6:01 AM / 8 years ago

Global drug industry tightens anti-corruption code

LONDON, March 1 (Reuters) - The global pharmaceutical industry is tightening its code of practice in a bid to stamp out bribery and corruption, particularly in emerging markets.

The International Federation of Pharmaceutical Manufacturers and Associations said on Thursday it had expanded and strengthened the code to ensure “the highest ethical and professional standards”.

Bribes paid to foreign doctors and other state employees are shaping up as a major legal liability threat for Big Pharma, which has already forked out billions of dollars to settle mis-selling scandals in the United States.

Johnson & Johnson settled for $78 million with British and U.S. authorities last April, after disclosing payments to doctors in Greece, Poland and Romania, while Pfizer reached an outline deal in a separate case late last year.

The new IFPMA code extends the rules covering drug company behaviour to also include interactions with medical institutions and patient organisations, as well as healthcare professionals, such as prescribing doctors.

It also makes clearer the dividing line between promotional aid and items of medical utility - which are allowed, and personal and cash gifts - which are not.

Permitted payments for entertainment are being curtailed, although they will still be allowed when interactions with drug firms are of a scientific or educational nature, including events at large medical meetings.

“The new code provides a framework for the industry to act with integrity and build trust,” said IFPMA President and AstraZeneca CEO David Brennan. “This is not about doing the easy thing, but the right thing.”

The Geneva-based organisation sees a particular role for its expanded code of practice in thinly regulated and smaller emerging markets, where national pharmaceutical organisations may have no presence.

But Tim Reed, director of Health Action International, an Amsterdam-based group that is critical of many industry practices, is not convinced the IFPMA has the teeth to make sure its edicts are implemented on the ground.

In the five years since the publication of the last code, the IFPMA has examined only four complaints against member companies - although more cases have been taken up by national organisations.

“There is a difference between intent and action,” Reed said. “When you drill down to what is happening in developing countries, it is clear that it is just not applied. There is a real problem with enforcement because there is no punitive action as a result of transgression.” (Editing by Kate Kelland and Jodie Ginsberg)

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