Industry insiders reveal the secrets of pharmaceutical corruption: there is a rebate model called "54321" nationwide | industry | corruption
As the anti-corruption storm continues to advance, the pharmaceutical industry is in a state of panic. "Recently, hospital directors have refused to meet and asked us not to go to the hospital to find them," a pharmaceutical industry sales representative told Beijing Business Daily. Generally speaking, at the beginning of product promotion, salespeople visit hospital experts within 3-5 days, but recently, many salespeople have been denied admission. According to incomplete statistics from Cyberblue, as of August 6th, the number of hospital deans and others who have been publicly reported as being investigated nationwide has reached 168. Due to statistical limitations, this number may actually be even higher.
"The industry generally follows the rebate model of 54321," industry insiders told Beijing Business Daily reporters. When a product enters the hospital, 5 points are given to higher ranking executives, which decrease in order. That is to say, for example, if the product profit is 2 million yuan, the person in charge with a higher position can receive 100000 yuan.
Multiple district deans have been investigated
Recently, sales in the pharmaceutical industry have clearly felt the tense atmosphere in the industry, and have been rejected by multiple hospital directors. They have also been informed that there is an inspection team and they should not come to the hospital recently.
The pharmaceutical anti-corruption storm is raging. The notice jointly issued by the National Health Commission and fourteen other departments on the key points for correcting unhealthy practices in the field of pharmaceutical procurement and sales and medical services in 2023 has become the most participated medical rectification department in the past five years. The mobilization meeting of the Central Commission for Discipline Inspection and the National Supervisory Commission pointed out that we will deepen the systematic governance of the pharmaceutical industry in all fields, all chains, and all coverage, adhere to the joint investigation of bribery and bribery, concentrate our efforts on investigating a number of corruption cases in the pharmaceutical industry, and form a deterrent effect.
According to statistics from the pharmaceutical industry media company CyberBlue, as of August 6th, the number of hospital deans who have been publicly reported as being investigated in China has reached 168. Due to statistical limitations, this number may actually be even higher. From a regional perspective, the three provinces with the highest number of publicly reported investigated deans and secretaries are Guangdong, Sichuan, and Yunnan. 41, 33, and 12 deans and secretaries have been investigated, respectively, accounting for 51.2% of the total number of reported cases in the country.
At the same time as the top leaders of hospitals have successively fallen, the chairmen of two A-share pharmaceutical companies have been successively investigated and filed, and this round of pharmaceutical anti-corruption actions has triggered a series of chain reactions in the industry. According to media reports, some pharmaceutical companies have even given drug agents leave and only pay basic wages. In addition, there has been a situation in the industry where hospitals require multinational pharmaceutical companies to dismiss pharmaceutical representatives.
"54321" rebate mode
The Central Commission for Discipline Inspection exposed a linear accelerator with a rebate of 16 million yuan, which recently made it to the hot search on Weibo. This is a case disclosed on the National Supervision website of the Central Commission for Discipline Inspection in May this year. In this corruption case, the import price of a linear accelerator was 15 million yuan, while the purchase price of the hospital was 35.2 million yuan, far higher than the market price during the same period.
On August 7th, the website of the Central Commission for Discipline Inspection and National Supervision published a report titled "Deep Attention | Precise Punishment of Unit Bribery", which once again highlighted the medical and health sector. In the case, Xu Kaihua, the shareholder and actual controller of Shanghai Fitz Electromechanical Equipment Co., Ltd., recommended a certain brand of medical equipment to Wang Xianming, the then director of the Leqing Health Bureau in Zhejiang Province, through his cousin Xu Yunfen, hoping to receive attention and agree to return a portion of the profit. Fitz and its partner companies have therefore won the bid for a medical equipment procurement project worth over 41 million yuan in the city. In 2021, with the support and coordination of Wang Xianming, companies collaborated with Xu Kaihua and others won 26 projects, totaling over 84 million yuan. The verdict shows that Xu Kaihua bribed Wang Xianming with a total of 7.15 million yuan through Xu Yunfen.
"Under normal circumstances, the industry generally follows a rebate model of 54321," an industry insider told a reporter from Beijing Business Daily. When a product enters a hospital, 5 points are given to the person in charge with higher positions, 4 points are given to the business director, 3 points are given to the pharmacy or equipment department, 2 points are given to the department director, and 1 point is given to some department doctors. That is to say, if the profit of the product is 2 million yuan, the person in charge with a higher position can receive 2 x 0.05=100000 yuan.
Strengthen the execution of convergence
This anti-corruption storm is still ongoing. On August 8th, the Shanghai Drug Administration, the Shanghai Market Supervision Administration, the Shanghai Higher People's Court, the Shanghai People's Procuratorate, the Shanghai Public Security Bureau and other relevant departments jointly issued the "Implementation Rules for Drug Administration Law Enforcement and Criminal Justice Street Connection Work in Shanghai", which will come into effect on September 1st, 2023.
The Implementation Rules mainly have the following three characteristics, namely, paying attention to the actual situation of the connection between the execution of sentences in the pharmaceutical field and timely solving the difficulties in connection; Pay attention to the workflow of criminal execution coordination in the pharmaceutical industry, and improve the guidance of supporting documents; Pay attention to the sharing of information on the connection between execution in the pharmaceutical industry, and fully leverage the effect of joint punishment for dishonesty in execution.
Zhang Wenbo, senior partner of Beijing Jundu Law Firm and director of the Life Science and Health Medical Law Department, said that the "Implementation Rules" clearly detailed the follow-up feedback of execution connection cases and the mechanism for inclusion in the list of serious violations and dishonesty. In the process of case transfer and cooperation in handling cases, drug regulatory departments, public security organs, procuratorates and people's courts shall each assign special personnel to handle the case, be responsible for the investigation and handling of cases, and timely connect and summarize the handling information of drug safety crime cases. If the drug regulatory department needs to implement the management of the list of serious violations of law and dishonesty in the legal documents received by the people's court, it shall refer to the relevant provisions of the measures for the administration of the list of serious violations of law and dishonesty in the market supervision and management, and construct a credit punishment pattern of "one violation of law, everywhere is limited.
