Novartis statement on employee oversight charges in Japan

Novartis Pharmaceuticals said today that although NPKK has not yet received official notification, NPKK understands that the Tokyo District Prosecutor's Office (TPO) has publicly disclosed that it will proceed with charges against a single former employee, Shirahashi, regarding the publication of an article containing manipulated data related to a sub- analysis of the Kyoto Heart Study in violation of Japan's Pharmaceutical Affairs Law.

Novartis Pharmaceuticals has also learned that the Tokyo District Prosecutor's Office (TPO) has publicly disclosed that it will proceed with charges against NPKK in Japan. The charges against NPKK are in connection with the actions of the single former employee, Shirahashi.

Under the dual liability characteristic of the Japan legal system, the charges allege that NPKK carries responsibility for failing to oversee an employee. The charge carries with it a maximum fine of 2 million Yen.

NPKK understands that the TPO has also re-arrested Shirahashi for further investigation. NPKK will co-operate with authorities in the ongoing investigation.

The company said it will review the contents of the charges against NPKK in further detail once it receives official notification from the TPO.

"Novartis and NPKK have already undertaken decisive action to address problems with the company's Investigator-Initiated Trial (IIT) research programs in Japan," said David Epstein, Global Division Head of Novartis Pharmaceuticals. "We are committed to changing the culture at NPKK and demonstrating ethical leadership among pharmaceutical companies in Japan."

In April, Novartis announced several measures designed to identify and correct all issues with IITs in Japan, including the replacement of the NPKK senior management team, a comprehensive third-party review of the company's IITs, and ongoing remedial training to ensure compliance with the company's Code of Conduct. The company also said it expects to soon issue new global guidelines on IITs.

Novartis said it remains fully committed to Japan and bringing breakthrough medicines to Japanese patients in the areas of cancer, multiple sclerosis, respiratory diseases such as Chronic Obstructive Pulmonary Disease (COPD), ophthalmology, skin diseases and heart failure.