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Teva to pay U.S. government $519 million over foreign bribery charges

Israel’s Teva Pharmaceutical Industries Ltd (TEVA.TA) (TEVA.N), said on Thursday it had agreed to pay $519 million to settle charges it violated the U.S. Foreign Corrupt Practices Act.

The settlement with the Department of Justice and the Securities and Exchange Commission relates to conduct in Ukraine, Mexico and a guilty plea by a subsidiary in Russia, and followed a voluntary investigation, Teva said.

Details of the misconduct, which Teva said ended several years ago, were not disclosed.

The SEC’s complaint had alleged that Teva made more than $214 million in illicit profits by making the payments to increase its market share and obtain regulatory approvals. (bit.ly/2hWVqRE)

Teva, the world’s biggest generic drugmaker, said no workers involved in the improper payments were with the company, and that it had replaced its entire leadership team in Russia in 2013.

The improper conduct did not involve U.S. sales, Teva said.

The Act makes it a crime to bribe foreign government officials to win business regardless of whether the payments are made directly or through other means such as extravagant entertainment or footing the bill for international travel.

Teva agreed to pay more than $236 million in disgorgement and interest to the SEC, in addition to a $283 million penalty in a deferred prosecution agreement with the Department of Justice.

The company, whose shares are listed on the New York and Tel Aviv stock exchanges, must also retain an independent corporate monitor for at least three years, the SEC said.

Teva said that since 2012 it had taken several steps to address issues of governance, including naming a global head of compliance and ending problematic business relationships.

Reuters reported earlier this month that Teva was investigating claims by an anonymous tipster that the company bribed state healthcare workers in Romania.

Teva’s shares were up 2.2 percent at $37.16 in morning trading in New York.

(Reporting by Natalie Grover in Bengaluru; Editing by Ted Kerr)

Reuters