United States v. Novartis Hellas S.A.C.I. (D. NJ 2020)
United States v. Alcon Pte Ltd (D. NJ 2020)

• Case Name
• United States v. Novartis Hellas S.A.C.I. (D. NJ 2020)
  United States v. Alcon Pte Ltd (D. NJ 2020)

• Date Filed
• 06/25/2020

• Enforcement Agency
• DOJ

• Foreign Official
• Unnamed foreign officials in Greece and Vietnam.

• Date of Conduct
• 2008 to 2015

• Nature of Business
• Novartis AG is a global pharmaceutical company headquartered in Basel, Switzerland.  Novartis’s publicly traded securities are listed on the New York Stock Exchange and registered with the SEC pursuant to Section 12(b) of the Exchange Act, and as such, it is considered an Issuer. 
  
  Novartis Hellas S.A.C.I., which is headquarted in Athens, Greece, is an indirect wholly-owned subsidiary of Novartis AG. 
  
  Alcon Pte Ltd, which is based in Singapore, was a wholly-owned subsidiary of Novartis prior to its spin-off in 2019.  It is now owned by Alcon, Inc., a multinational eye care company incorporated in Switzerland.  

• Influence to be Obtained
• According to the DOJ, Novartis Hellas S.A.C.I. sought to bribe employees of state-owned hospitals and clinics in Greece to increase sales of Novartis prescription drugs.  The Greek subsidiary allegedly sponsored employees of public healthcare clinics to attend international congresses to similarly bolster prescription sales.  Novartis Hellas is alleged to have received at least $71.48 million in profits from sales of the illicitly promoted prescription drugs in Greece. 
  
  The DOJ alleges Alcon Pte Ltd, while still a subsidiary of Novartis AG, hired an unnamed distribution company to increase sales of surgical equipment and devices to state-owned hospitals and clinics in Vietnam.  Internal emails allegedly show the company’s use of a consultancy program to hide payments in furtherance of the scheme.   According to the DOJ, Alcon Pte Ltd realized approximately $8.5 million in profits between 2011 and 2014 from sales related to the bribery scheme.

• Enforcement
• On June 25, 2020, the DOJ announced that it entered a deferred prosecution agreement with Novartis Hellas S.A.C.I.  Under the agreement, Novartis Hellas agreed to pay $225,000,000 in criminal penalties as a result of two conspiracy counts to violate the FCPA’s anti-bribery and books and records provisions, respectively.  It also agreed to report to the DOJ for a term of three years under the DPA. 
  
  On the same day, the DOJ announced it entered into a deferred prosecution agreement with Alcon Pte Ltd regarding one count of conspiracy to violate the books and records provisions of the FCPA.  Alcon Pte Ltd agreed to pay $8,925,000 in criminal penalties and to reporting requirements for a term of three years.
  In a related matter, the SEC settled a parallel enforcement action against Novartis AG—the parent company.  It was required to pay $92.3 million in disgorgement, $20.5 million in prejudgment interest, for a total of $112.8 million.

• Amount of the Value
• Not stated.

• Amount of Business Related to Payment
• Novartis Hellas: $71.8 million.
  Alcon Pte Ltd: $8.5 million.

• Intermediary
• Novartis Hellas: Not stated.
  Alcon Pte Ltd: Unnamed distribution company. 

• Citizenship of Parent Entity
• Switzerland

• Total Sanction
• $ 233,925,000

• Compliance Monitor
• No

• Reporting Requirements
• Yes (3 Years)

• Case is Pending?
• No

• Total Combined Monetary Sanction
• $ 346,725,000

• Related Enforcement Actions
• In the Matter of Novartis AG (2020)
  

Novartis Hellas S.A.C.I.

• Citation
• United States v. Novartis Hellas S.A.C.I., 20-cr-00538 (D. NJ June 25, 2020)

• Date Filed
• 06/25/2020

• Filed Under Seal
• No

• Date Case Was Unsealed
• 07/08/2020
  

• FCPA Statutory Provision

• Other Statutory Provision
• Anti-bribery conspiracy; Books and Records conspiracy.

• Disposition
• Deferred Prosecution Agreement, Deferred Prosecution Agreement

• Defendant Jurisdictional Basis
• Agent of Issuer

• Defendant's Citizenship
• Greece

• Individual Sanction
• $225 million.

Alcon Pte Ltd

• Citation
• United States v. Alcon Pte Ltd, 20-cr-00539 (D. NJ June 25, 2020)

• Date Filed
• 06/25/2020

• Filed Under Seal
• No

• Date Case Was Unsealed
• 07/08/2020
  

• FCPA Statutory Provision

• Other Statutory Provision
• Books and Records conspiracy.

• Disposition
• Deferred Prosecution Agreement, Deferred Prosecution Agreement

• Defendant Jurisdictional Basis
• Agent of Issuer

• Defendant's Citizenship
• Singapore

• Individual Sanction
• $8.925 million.