Corruption does not discriminate based on industry, and with international regulations against global extortion and bribery increasing, making preparations to position your company against corrupt acts is imperative. The recent Teva FCPA investigation again highlighted this important fact.
Teva FCPA Investigation Lands The Company In Fourth Place
Teva, the biggest manufacturer of generic drugs in the world, lands in the fourth position on the list of the 10 most expensive settlements in the history of FCPA enforcement.
Resulting from the Teva FCPA investigation was a settlement for the multi-billion dollar Israeli company reaching $519 million with a $236 million disgorgement (the second biggest disgorgement in history, displacing Och-Ziff).The pharmaceutical giant is currently doing everything to preserve its dignity.
According to Erez Vigodman, Teva’s President and CEO, “Since becoming CEO, I have worked diligently to make our culture of compliance central to everything Teva does. The compliance program that Teva has in place is serious, rigorous, and comprehensive and is designed to protect the company and its subsidiaries against future violations.”
Meanwhile the DOJ decided to reduce Teva’s criminal penalty by 20 percent because of its cooperation and self-correction. However, it did not receive full cooperation credit due to the lateness in providing certain documents and an ambiguous, “vastly overboard assertion of attorney-client privilege”.
Teva FCPA Investigation | Corruption in the Global Pharmaceutical Industry
The Teva FCPA investigation began due to charges brought against the pharmaceutical giant due to illicit payments to officials in Russia, the Ukraine and Mexico. While in Mexico the company bribed government employed doctors, and in the Ukraine they hired a government official as a consultant and paid him around 200,000 USD in monthly fees and travel.
The bribery of the government official in the Ukraine allowed Teva to improperly influence the registration of Teva pharmaceutical products in the country.
In Russia, Teva is accused of bribing an official who worked for the ministry of health, who also owned a repackaging company. The official ended up making $65 million through the agreement.
Having an influence over the purchase of pharmaceutical products by the Russian government, the official had means to secure Teva a prominent place in the Russian pharmaceutical market.
In this regard, the DOJ specifically alleges that “employees and agents of Teva Russia concealed negative information about the Russian Company when Teva was undertaking due diligence, including information about the Russian Official’s alleged involvement in corruption related to Russian government drug procurement auctions.”
The enforcement action focuses on Capaxone, a very profitable drug that is used to treat multiple sclerosis. Although Capaxone is considered a successful drug, and does not compromise patient’s health, how it was sold and advertised has been described as unethical due to the serious corruption schemes that were involved in the process.
According to Teva none of the employees involved in corruption are still employed by the company, and the whole leadership team in Russia was completely replaced in 2013.
Teva engaged independent counsel to assist in the investigation and conducted a global corruption risk assessment. The company ended up terminating problematic business relationships with third parties and ceasing operations in several countries.
Protecting Your Company When Engaging in International Business
While large cases like the Teva FCPA investigation are rare, no company that does work abroad and cooperates with third parties is immune from similar actions by its employees subject to FCPA investigations. Preventative steps should include assigning individuals to collect and preserve relevant documents to international business.
Often these documents include, but are not limited to, information about day-to-day operations, financials, communications with foreign and government officials, employees and third party representatives, system data reporting, travel and entertainment expenditures, payment data, chat messaging and social media posts.
However, simply collecting documents is unfortunately not enough in many cases.
If your company operates abroad and conducts business with foreigners many of these documents can be in languages other than English. To be considered evidence in U.S. court of law they have to be translated into English.
Legal Translation As A Part of Your Anti-Corruption Strategy
Any FCPA, general Corruption, or legal translation for that matter, is going to be complicated due to the nature of the documents and where they will be used. FCPA legal translation solutions should be tailored to the specifics of the particular investigation, and ideally done in collaboration with internal technological resources of the legal firms.
Human translators, who work as certified linguists with experience in both the target language of the particular case, and in the legal sector, are ideal when translating for regulatory and other legal purposes.
It’s important to keep in mind that translation services shouldn’t be sourced after corruption has been uncovered. The Teva FCPA investigation again highlighted the fact that taking preventative measures can reduce penalties by the DOJ if your company does end up in a corruption battle. Training your employees working internationally on policies relating to bribery and corruption can go a long way.
Translating e-learning and training materials, contracts, regulations, codes of conducts, and other company policies can increase your chances of warding off corruption from the start.
Language Connections employs a network of legal translation providers around the globe. Our international presence allows our linguists to stay abreast not only of U.S. international business regulations, but also those of countries around the world – allowing you the ability to take control of due diligence for your international business, and discouraging corruption from the onset.
About Language Connections:
Language Connections is one of the top language service companies in the US. Over the last 30 years, we’ve focused on providing the best business translation services, interpreting services, as well as interpreter training and customized language training programs. In addition to top-tier corporate language training, we offer certified corporate interpreters and professional business translation services in 200+ languages. Our network includes linguists with backgrounds in all major industries. They’re ready to meet your needs, whether they’re for technical translation services, legal translation, government translation services, international development translation services, education translation services, life sciences translation, or something else. Reach out to us today for a free quote on our cost-efficient and timely translation services, interpreters, or other linguistic services.
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