Ethical Performance
inside intelligence for responsible business


Novartis Japan ordered to halt sales for failure to report drug side effects

April 2015

Health authorities ordered the Japanese unit of Novartis AG to shut down most operations for 15 days in March, saying the drug maker failed to report side effects from its products in a timely fashion.

“Novartis Pharma will not sell prescription drugs from March 5 to 19, with the exception of five for which there are no generics or whose absence would have very damaging consequences for patients,” said Japan’s Ministry of Health, Labour and Welfare in a statement.

Novartis had acknowledged the facts last year and had already received an “Business Improvement Order,” a disciplinary warning from the Ministry, after it submitted a partial report on the failings

The ministry said Novartis Japan failed to report 3,264 cases of side effects involving 26 drugs within the period required by law.

Since the final number of omissions was much higher than initially reported, the Ministry decided a more severe punishment was required.

According to the Ministry, this case was the first time a business suspension order has ever been issued over a failure to report side effects.

This is but the latest of a series of scandals that has damaged Novartis in Japan over the last two years.

The first broke out in 2013 when two Japanese universities had denounced the manipulation of clinical results for Diovan (Valsartan) a lucrative drug against hypertension.

Last year, the Japanese government also filed a complaint against Novartis for “false and exaggerated advertising’”

Novartis Pharma, has repeatedly promised cooperation with the authorities to resolve these issues, however, it also used the disputed results to promote the drugs in question.

In the wake of the scandals, Novartis AG, the parent company, replaced the management of Novartis Japan last year to try to stop “bad practice” but more work seems necessary.

Novartis Japan said it accepted the punishment and apologized to patients and doctors for “causing trouble and worry.”

The company said that after reviewing the side-effect reports, it didn’t find any that would necessitate changing safety information on drug labels. However, Japan’s Ministry of Health does not leave it to manufacturers to take such decisions unilaterally and requires prompt reporting of any and all findings regarding the safety, efficacy, or use of drugs, no matter what.

Japan is the world’s second largest pharmaceutical market. In 2014, sales of Novartis drugs there accounted for about 7% of the company’s total sales. 

Asia | corporate reputation


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