Teva Pharmaceutical Industries Ltd. (TEVA), the world’s biggest maker of generic medicines, said it discovered suspect business practices in eastern Europe and Russia during an internal investigation that began last year.
Issues in these countries were found that may have implications under the Foreign Corrupt Practices Act and have been disclosed to U.S. authorities, the Petach Tikva, Israel-based company said today in a filing with the Securities and Exchange Commission. The practices may also violate local laws, Teva said.
Teva’s probe, which is being conducted by independent counsel, started last year after the company received requests from the U.S. Justice Department for documents in connection with a bribery investigation in Latin America. The discovery adds to Teva’s woes after Chief Executive Officer Jeremy Levin abruptly left the drugmaker amid a cost-cutting effort that calls for a reduction in 5,000 jobs.
“Teva has provided and will continue to provide documents and other information to the SEC and the DOJ, and is cooperating with the government in their investigations of these matters,” the company said in the filing. “No conclusion can be drawn at this time as to any likely outcomes.”
Operations in the affected countries may be negatively effected, and Teva may be required to pay fines, “be subject to injunctions on future conduct and/or the imposition of a compliance monitor, or suffer other criminal or civil penalties or adverse impacts, including lawsuits by private litigants,” the company said.
U.S. law enforcement authorities have been probing drugmakers including Pfizer Inc., AstraZeneca Plc (AZN), Bristol-Myers Squibb Co. (BMY) and GlaxoSmithKline Plc in connection with possible violations of the overseas anti-bribery law that bars employees or their agents from paying bribes to foreign government officials to obtain or retain business.
The 1977 Foreign Corrupt Practices Act makes it illegal to pay foreign officials to win business. The law was passed after an SEC investigation in the 1970s found that 400 U.S. companies had paid $300 million in bribes abroad, according to the Justice Department.
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