Bribery amounts to millions! Even after the centralized procurement, some deans still receive kickbacks! More than ten cases reveal details of pharmaceutical purchase and sales bribery, Yang Moujun | Method | Case
The pharmaceutical industry is facing a new round of anti-corruption.
Recently, the National Health Commission and nine other departments, including the National Medical Insurance Administration, jointly held a video conference to deploy a one-year nationwide campaign to address corruption in the pharmaceutical industry.
According to incomplete statistics, over 150 hospital secretaries and deans across the country have been notified by various disciplinary and supervisory commissions since the beginning of this year, mainly involving seeking benefits for others through drug procurement, medical equipment and consumables procurement, and accepting bribes.
The first financial reporter sorted out more than ten bribery cases in the pharmaceutical industry that have been publicly disclosed by relevant regulatory agencies in the past year. From these cases, it can be seen that they are mainly concentrated in the pharmaceutical purchase and sales process, and the bribery methods are more covert, such as through consultation fees, loans, and other means.
It is worth noting that in recent years, the centralized procurement in the pharmaceutical industry has become normalized, and the discourse power of medical institutions has gradually been weakened. The purpose of promoting centralized procurement is to squeeze out artificially high drug prices, reduce the behavior of pharmaceutical companies "tackling" hospitals and doctors, and thus "cut off" sales with gold. However, there are also individual cases where the hospital still needs to receive kickbacks after centralized procurement.
Bribery through consultation fees, loans, etc
In 2019, with the improvement of the national drug procurement management system, the profit margin of drug suppliers after "centralized procurement" became smaller. After giving He Xianwei a 15% rebate, the drug dealers had almost no profit to speak of. He always wanted to negotiate with He Xianwei to reduce the rebate ratio, but every time he met, He Xianwei remained silent and immediately left after receiving the money, in less than ten seconds.
This is a case of secret interest transfer in the medical field disclosed by the website of the Central Commission for Discipline Inspection and the National Supervisory Commission on February 6 this year. The protagonist of the above-mentioned case is He Xianwei, former director of the People's Hospital of Huzhong District in the Greater Khingan Mountains region of Heilongjiang Province.
It is reported that in June 2014, He Xianwei, who served as the dean for more than half a year, took the initiative to contact He, the chairman of a pharmaceutical company in Heilongjiang Province, to collect drug rebates. Afterwards, he followed suit and extended the hand of accepting kickbacks to the other two pharmaceutical companies. This corruption case involves a large amount of money and a long duration, covering two major fields of drugs and medical devices, involving more than 10 pharmaceutical and medical device companies nationwide. It is the largest corruption case investigated in the medical field since the establishment of the Greater Khingan Mountains region. After investigation, it was found that during He Xianwei's tenure as the hospital director, he made unauthorized decisions about drug dealers and received more than 3.08 million yuan in drug kickbacks.
Throughout history, the purchase, sale, and use of pharmaceutical equipment have been a "disaster zone" for the breeding of corruption. The more than ten cases of pharmaceutical bribery sorted out by the First Financial Journalist mainly occurred in the purchase, sale, and use of pharmaceutical equipment, many of which involved kickbacks to hospital departments or doctors.
For example, Li Xiaofu, the former director of the Department of Orthopaedics of Mianzhu People's Hospital, as the deputy director and director of the Department of Orthopaedics of Mianzhu People's Hospital, received a total of 416200 yuan of cash rebates from distributors when he was serving as the deputy director and director of the Department of Orthopaedics of Mianzhu People's Hospital, and repeatedly arranged medical students in departments or on behalf of departments to receive 5166700 yuan of cash rebates from distributors, of which Li Xiaofu himself received 1432700 yuan.
Some pharmaceutical companies adopt more covert and complex measures to cover their bribery behavior with a "legal facade". If some enterprises engage in illegal transfer of benefits under the guise of sponsoring scientific research funds, academic conference fees, loans, etc.
Recently, the Guangzhou Municipal Administration for Market Regulation issued an "Administrative Penalty Decision", which determined that Guangzhou Yueda Medical Equipment Co., Ltd. paid a "consultation fee" of 35000 yuan to personnel of a hospital in Guangdong Province as a benefit fee, constituting commercial bribery. The Guangzhou Municipal Administration for Market Regulation ordered Guangzhou Yueda Medical Equipment Co., Ltd. to immediately rectify its illegal behavior, confiscate more than 2.88 million yuan of illegal gains, and impose a fine of 2.15 million yuan, totaling more than 5.03 million yuan.
On May 22, the website of the Central Commission for Discipline Inspection and the National Supervisory Commission announced that the suspected bribery case of Yang Moujun, former director of Pu'er People's Hospital, involved the fact that medical device dealer Chen Mouhu bribed Yang Moujun through "borrowing" to sell linear accelerators, with a bribe amount of over 16 million yuan.
It is worth mentioning that behind this bribery case, medical device dealer Chen Mouhu sold a linear accelerator to Pu'er People's Hospital at an import price of 15 million yuan, but the hospital's purchase price was 35.2 million yuan, far higher than the market price during the same period. In other words, the bribery has to some extent raised the sales price of medical devices.
On November 17, 2022, the State Administration for Market Regulation released the "Typical Cases of Special Law Enforcement Actions against Unfair Competition in 2022", which also disclosed the commercial bribery case of Hefei Beisien Medical Technology Co., Ltd.
It is reported that in May 2020, Hefei Beisi'en Medical Technology Co., Ltd. signed an agreement with the Otolaryngology Department of a certain county People's Hospital to pay for scientific research expenses, so that its corrective ear models can be promoted and sold in the county People's Hospital from June 2020 to August 2021. During this period, Hefei Beisi'en Medical Technology Co., Ltd. sold a total of 178 corrective ear models in the county hospital. Bai, a staff member of Hefei Beisi'en Medical Technology Co., Ltd., paid a research fee of 35000 yuan to the ear, nose and throat department of the county hospital in cash in two installments. At present, the behavior of doctors in the otolaryngology department of the People's Hospital of the county accepting sponsorship fees from the parties involved has been transferred to the hospital's disciplinary inspection department for further investigation and disposal. Hefei Beisien Medical Technology Co., Ltd. was also fined 300000 yuan.
Bribery in the pharmaceutical procurement and sales process is repeatedly prohibited
On July 21st, the National Health Commission announced that it had recently held a video conference with nine major departments, including the National Medical Insurance Administration, to deploy a one-year centralized crackdown on corruption in the national pharmaceutical industry. The meeting pointed out that in response to the key links and "key minorities" in the production, supply, sales, use, and reimbursement of the pharmaceutical industry, we will adhere to a combination of treating both symptoms and root causes and rectifying construction, and adhere to the principle of being practical and tough, combining leniency and strictness. We will deepen the systematic governance of the pharmaceutical industry in all fields, all chains, and all coverage, further forming a high-pressure situation, and comprehensively promoting "not daring to corrupt, not being corrupt, and not wanting to corrupt".
On July 28th, the Central Commission for Discipline Inspection and the National Supervisory Commission held a mobilization meeting, deploying disciplinary inspection and supervision agencies to cooperate in carrying out centralized rectification of corruption in the national pharmaceutical industry.
This round of pharmaceutical anti-corruption has "alarmed" the A-share capital market. Since the beginning of this week, some pharmaceutical stocks have experienced consecutive bearish declines. According to a report by Shanghai Securities News on August 2nd, the Beijing Stock Exchange recently issued four key audit focuses on the commercial rationality of promotion fees under the promotion and sales model of pharmaceutical enterprises, whether they meet the conditions for lawful and standardized operation of issuance and listing, including whether the internal control system is sound and effective, whether the occurrence of abnormal promoter related business is true and reasonable, whether abnormal fund transactions are effectively eliminated through fund flow verification, and whether relevant external evidence is fully obtained.
From the current perspective, bribery in the pharmaceutical procurement and sales process remains one of the key areas of anti-corruption efforts.
On May 11, the National Health Commission and 14 other departments jointly issued the "2023 Key Points for Correcting Unhealthy Practices in the Field of Pharmaceutical Purchasing and Sales and Medical Services", which pointed out that in rectifying the problem of improper practices in the sales and procurement of pharmaceutical products, the focus is on various levels and types of pharmaceutical production and operation enterprises, as well as their associated distributors and pharmaceutical representatives, implementing "sales with gold" in various names or forms, giving kickbacks to medical institution employees, and using various forms to transfer benefits to relevant institutions; And in the centralized procurement of drugs and medical consumables, failure to fulfill procurement contracts, including refusal to execute the results of centralized procurement, setting obstacles for the admission of selected products, purchasing high priced non selected products or clinically replaceable products, and violating regulations.
For many years, regulatory authorities have also been cracking down on bribery in the pharmaceutical procurement and sales process, but it still seems to be repeatedly prohibited.
