BMS to Pay $14 Million in Settlement With SEC

Bristol-Myers Squibb has agreed to pay more than $14 million to settle charges that its joint venture in China made cash payments and provided other benefits to healthcare providers at state-owned and state-controlled hospitals in exchange for prescription sales.

The Securities & Exchange Commission announced the settlement on last week, saying BMS violated the Foreign Corrupt Practices Act and reaped more than $11 million between 2009 and 2014.

BMS China sales representatives provided physicians with cash, jewelry and other gifts while recording the spending as legitimate business expenses. In its order, the SEC says the drugmaker failed to respond effectively to red flags indicating sales staff provided bribes and other benefits to drive sales in China, didn’t investigate claims by terminated employees that faked invoices, receipts and purchase orders were used to fund the improper payments.

BMS neither admitted or denied any wrongdoing, but consented to the SEC order and agreed to return $11.4 million in profits and pay $500,000 in prejudgment interest and a $2.75 million civil penalty. — John Bechtel