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Prosecutors raid lobby group of foreign drug firms in rebate probe

All News 17:43 June 13, 2016

SEOUL, June 13 (Yonhap) -- Prosecutors recently raided the Seoul office of an industry lobby group for multinational pharmaceuticals firms, as part of their ongoing investigation into rebates, an illegal business practice blamed for driving up medical costs for patients, industry sources said Monday.

The Seoul Western District Prosecutors' Office probing the case obtained relevant documents from the office of the Korea Research-based Pharmaceutical Industry Association (KRPIA), the lobby group for 35 foreign drug companies operating in the country, last Wednesday, they said.

The foreign drug manufacturers allegedly engaged in kickback-related deals, such as offering illegal payments to doctors and hospitals in exchange for prescribing their products, the sources said.

"It is not a common thing for the prosecution to raid the lobby group of pharmaceutical firms," said a source, noting that the raid is part of the probe to look into any illegal acts.

Last year, the Seoul prosecutors raided an office of the South Korean unit of Swiss pharmaceutical giant Novartis on suspicions it handed out bribes to local doctors in return for using their medicines.

The KRPIA, meanwhile, refused to comment on the investigation, saying that the raid "is part of several investigations and that there is no particular allegation."

Earlier, the government declared war against the long-running illegal practice in a bid to ease the financial burdens of patients and reduce price ballooning. The prosecution has since indicted local pharmaceutical firms and doctors in line with the government's efforts.


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