Bristol-Myers to Pay $14 Million to Settle SEC's Probe of Bribery in China

   By Tess Stynes 
 

Bristol-Myers Squibb Co. (BMY) agreed to pay more than $14 million to settle allegations that the pharmaceutical company's China joint venture provided illegal payments and other benefits to Chinese health-care providers to boost sales.

The U.S. Securities and Exchange Commision accused Bristol-Myers of lacking internal controls over the BMS China venture's interactions with health-care providers and failing to respond effectively to signs that sales personnel were providing bribes and other benefits to boost sales.

According to the SEC order, Bristol-Myers netted roughly $11 million in profits from the actions. The company agreed to turn over $11.4 million of profits plus prejudgment interest of $500,000 and pay a civil penalty of $2.75 million.

Bristol consented to the order without admitting or denying the findings that it violated the internal controls and record-keeping provisions of the Foreign Corrupt Practices Act. A Bristol-Myers spokesman added that it has resolved the matter with the SEC.

The SEC accused BMS China sales representatives of providing health-care providers in China over five years with cash, jewelry and other gifts to secure and raise sales. According to the SEC, the unit inaccurately recorded such spending as legitimate business expenses.

Among the SEC's findings, Bristol is accused of failing to investigate claims by terminated BMS China employees that faked invoices, receipts and purchase orders were widely used to fund the improper payments.

Write to Tess Stynes at [e-mail]

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(END) Dow Jones Newswires

October 05, 2015 13:00 ET (17:00 GMT)

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