June 1, 2016 / 11:12 PM / a year ago

Anti-graft group says drugmakers failing to tackle corruption

A person holds pharmaceutical tablets and capsules in this picture illustration taken in Ljubljana September 18, 2013. REUTERS/Srdjan Zivulovic

LONDON (Reuters) - The global pharmaceuticals industry remains open to corruption abuse, despite a raft of scandals in recent years, with both companies and governments failing to tackle the issue adequately, according to Transparency International.

The anti-corruption advocacy group said on Thursday there were dangerous loopholes across the drug supply chain, from lack of publicly available research data to underhand marketing practices to poor enforcement of manufacturing standards.

“It is shocking that despite scandal after scandal involving pharma companies, still policy makers simply are not taking seriously the corrosive effect of corruption,” Sophie Peresson, its head of pharmaceuticals and healthcare, said. “The red flags are being ignored.”

Drugmakers are certainly no strangers to corruption claims.

Big Pharma has forked out billions of dollars to settle scandals involving improper promotion of drugs in the United States and, more recently, bribes paid to foreign doctors have emerged as another area of malpractice.

GlaxoSmithKline (GSK.L), for example, paid a record fine of nearly $500 million in 2014 for bribery in China and many companies face investigation under the U.S. Foreign Corrupt Practices Act.

At the beginning of 2016, Transparency International said one in 10 corruption investigations by U.S. authorities involved pharmaceutical companies, significantly more than for the banking sector.

The European Federation of Pharmaceutical Industries and Associations agreed good governance was vital but it criticized the report for failing to mention a host of positive industry-led initiatives in areas such as financial transparency, data sharing and the fight against falsified medicines.

Reporting by Ben Hirschler; editing by Adrian Croft

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