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Drug industry insiders allege dubious practices in sector

File - View of the headquarters building of GlaxoSmithKline (GSK) in London, UK, 24 July 2013. (Imaginechina via AP Images)

BEIRUT: Pharmaceutical industry insiders say dubious business practices are widespread in the Lebanon’s drugs sector following an announcement by a British company that it was investigating bribery allegations in Jordan and Lebanon.

GlaxoSmithKline is the United Kingdom’s largest drug firm and has recently been beset by controversy for allegedly bribing doctors in exchange for favoring their pharmaceutical products. Pharmaceutical industry insiders interviewed by The Daily Star said that while full-on bribery was uncommon in Lebanon, a number of shady strategies are employed by pharmaceutical companies to push their products both locally and abroad.

“I believe that at least 90 percent of pharmaceutical companies offer certain kinds of, I wouldn’t say bribes, but sponsorship,” said a nine-year veteran of the pharmaceutical industry, speaking on condition of strict anonymity. All industry insiders requested their names be withheld for fear of losing their jobs or hurting their chances at future employment.

Competition between various generic and brand name drugs, all with the same molecular makeup, means sometimes deals between drug companies and doctors take place in an ethical and legal “gray zone,” with no real regulations.

The process starts when doctors are approached by pharmaceutical representatives attempting to market a product. The representative’s goal is to convince the doctor to refer to their product when doling out prescriptions. “They regulate the issue between the salesman and the physician,” said a senior health care analyst employed at a local pharmaceutical company.

“It’s a sensitive issue to generalize about because it’s not always a bribe or a gift but you have to give something for the doctor to remember you by,” said the veteran insider, indicating that neither party is entirely innocent. “It’s a give and take.”

Doctors are influenced in various ways. Some are invited to scientific conferences abroad where they are seduced by the prospect of money that the company writes off as expenses. Sometimes these conferences don’t actually exist, but are labeled as such to give the doctor a holiday with their spouse and children. Other doctors blatantly request cash, gifts, new machinery, or they may ask for a cut of the profits to sell a particular product.

“[Doctors] are very straight forward about it,” said E.N., a former employee at a pharmaceutical company who has since left the industry. “A doctor I approached once with a new drug told me, ‘OK, I will prescribe your drug if you give me a laptop,’” she added.

Another insider interviewed said that some doctors would unashamedly try to play two pharmaceutical companies off against one another. “Some doctors may tell you, ‘this company offered me this amount, how much can you give me?’” she said.

Most insiders said that their companies did not encourage or actively instruct representatives to entice doctors but that such stories were broadly circulated among colleagues. Nearly all sources said they had experienced first-hand cases of doctor’s requesting gifts like laptops, a Xerox machine, or new medical equipment for their office.

In China, authorities accused Glaxo of providing doctors with sexual favors, British daily the Guardian reported. Only one of the insiders interviewed said that they had heard of a doctor requesting sexual favors from a colleague and that it took place in a remote quarter of Lebanon.

“Unfortunately, Lebanon is way behind on the compliance issue,” said the senior health care analyst. “There is no law that regulates offering doctors things ... so it’s a gray zone.”

Paying government officials, which includes state-employed doctors, is prohibited for multinationals like Glaxo, according to the U.K. Bribery Act. The practice is also illegal for American companies under the U.S. Foreign Corrupt Practices Act. But in Lebanon, these restrictions do not apply to non-American or non-British companies.

Insiders said that such practices occur among both local and multinational companies and involve “more than 70 percent of reputable doctors” in Lebanon. “Sometimes they will pay a decision-maker in the hospital even if it’s not the best product,” said the nine-year veteran.

Employees of the multinational firms said strict financial records make it more difficult to engage in questionable acts but that some cases still transpire. With larger budgets and more spending power, multinationals have more flexibility.

“[Glaxo] is a multinational pharmacy group and they have strict regulation compliance in the U.K.,” the senior health care analyst said. “However, when these companies work through their representative offices they are a bit more free. Nothing official is written and it can’t be shown in the bank balance but they find ways around it.”

This is contradictory to Glaxo policy in the U.K., said the senior health care analyst, adding that while the main office in the U.K. may not encourage such policies, the local office may be more concerned about increasing sales.

Local companies, on the other hand, have “very loose” records, said H.D., an employee at a multinational. “They have no auditing. They just receive a transfer and are told to file receipts.”

Local companies or companies from “other third world countries” were also accused of marketing subpar generic drugs as being equal to brand names, said S.M. a two-year veteran at a multinational.

Doctors generally won’t sell faulty drugs for long though due to the potential damage their reputations would face should patients find out. “Reputable doctors especially [would not sell defective drugs] but not because they are smart or knowledgeable,” said the veteran insider. “[They wouldn’t sell defective drugs] because they have deals to make and they are marketing themselves.

“As far as I know the primary concern for doctors is patients because that’s how they generate money. A minority [of doctors] care about the patients’ health,” he added. “I know doctors ready to prescribe charcoal if they are paid.”

 
A version of this article appeared in the print edition of The Daily Star on April 19, 2014, on page 3.

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Summary

Pharmaceutical industry insiders say dubious business practices are widespread in the Lebanon's drugs sector following an announcement by a British company that it was investigating bribery allegations in Jordan and Lebanon.

GlaxoSmithKline is the United Kingdom's largest drug firm and has recently been beset by controversy for allegedly bribing doctors in exchange for favoring their pharmaceutical products. Pharmaceutical industry insiders interviewed by The Daily Star said that while full-on bribery was uncommon in Lebanon, a number of shady strategies are employed by pharmaceutical companies to push their products both locally and abroad.

The process starts when doctors are approached by pharmaceutical representatives attempting to market a product.

Doctors are influenced in various ways.

Another insider interviewed said that some doctors would unashamedly try to play two pharmaceutical companies off against one another.

The practice is also illegal for American companies under the U.S. Foreign Corrupt Practices Act.

Local companies, on the other hand, have "very loose" records, said H.D., an employee at a multinational.

Local companies or companies from "other third world countries" were also accused of marketing subpar generic drugs as being equal to brand names, said S.M. a two-year veteran at a multinational.


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