Additionally, the SEC alleged that Cardinal China employees paid government-employed healthcare professionals and state-owned retail companies’ staff with influence over purchasing decisions.
The companies had a profit-sharing agreement in which the dermo-cosmetic company provided Cardinal Health with a percentage of profit from sales derived from improper payments.
Cardinal Health failed to apply its full accounting controls to the accounts and regularly authorized the payments without reasonable assurances that the transactions were executed appropriately. As a result, the pharmaceutical company failed to maintain complete and accurate books and records concerning the marketing accounts, according to the SEC.
In a statement, SEC Division of Enforcement Associate Director Anita Bandy said Chardina Health failed to implement anti-bribery controls over its subsidiary’s high-risk business practices in China.
Bandy added that the FCPA prohibits the pharmaceutical company’s “conduct, which undermined the integrity of its books and records and increased the risk that improper payments would go undetected.”
