Medical corruption in an audit investigation report
While affirming that Guangdong Province attaches great importance to the high-quality development of the pharmaceutical industry, the audit findings also point out that many pharmaceutical consumables distribution enterprises have increased intermediate sales links and raised the price of medical equipment, medical personnel have long accepted the benefits from pharmaceutical companies, and medical institutions have illegally purchased or used medical equipment.
Reporter | Qu Yixian
Source | vision china
On August 8th, an investigation report on special audit of People’s Republic of China (PRC) Audit Office (draft for comments) obtained by Economic Observer Network showed that three pharmaceutical manufacturers in Guangdong Province had used 4.077 billion yuan for public relations and other purposes, pushing up the ex-factory price of drugs.
In addition, while affirming that Guangdong Province attaches great importance to the high-quality development of the pharmaceutical industry, the audit findings also point out that many pharmaceutical consumables distribution enterprises have increased intermediate sales links and raised the price of medical equipment, medical personnel have long accepted the benefits from pharmaceutical companies, and medical institutions have illegally purchased or used medical equipment.
From the end of May to July, 2023, the audit team sent by the National Audit Office conducted a special audit investigation on the production, distribution and use of drugs and high-value medical consumables in Guangdong Province (excluding Shenzhen, the same below), focusing on the relevant administrative departments of drug supervision, medical security and health care in Guangdong Province, public hospitals, primary medical and health service institutions and other medical institutions, and the production and distribution enterprises of drugs and consumables.
People close to the Guangdong Health Care System told Economic Observer that the Guangdong Health Care System was indeed being audited some time ago and just ended. "This audit is very strict."
The above audit investigation report was signed by "Guangdong Provincial Special Audit Investigation Team on the Production, Distribution and Use of Drugs and High-value Medical Consumables", which was forwarded by the Guangdong Provincial Health and Health Commission Office to Guangzhou, Zhuhai, Foshan, Heyuan, Dongguan, Zhongshan Health Bureau (Commission), Provincial People’s Hospital, Provincial Second People’s Hospital, Third Affiliated Hospital of Sun Yat-sen University, Cancer Prevention Center of Sun Yat-sen University, Stomatological Hospital of Sun Yat-sen University, Southern Hospital of Southern Medical University, and Second Affiliated Hospital of Southern Medical University.
The staff of the above-mentioned hospital confirmed to the Economic Observer that the investigation report forwarded by the Guangdong Provincial Health and Health Commission was true. The doctor of another hospital told Economic Observer that the hospital level issued several anti-corruption announcements.
Drug production enterprises collect funds for public relations.
Audit spot checks found that from 2021 to May 2023, three pharmaceutical manufacturers in Guangdong paid fees to 1,936 third-party business promotion companies, and withdrew 4.077 billion yuan in the name of service fees, which increased the comprehensive cost of drugs and pushed up the ex-factory price.
These three enterprises are Guangdong Yifang Pharmaceutical Co., Ltd. (hereinafter referred to as "Guangdong Yifang Company"), Guangzhou Poinsettia Pharmaceutical Co., Ltd. (hereinafter referred to as "Guangzhou Poinsettia Company") and Livzon Group.
Among them, the Guangdong company paid 2.39 billion yuan to 966 business promotion companies in the name of "technical service fee", which was used for the pharmacy construction cost and labor cost of cooperative hospitals.
Guangzhou Poinsettia Company collected 1.675 billion yuan by registering conference service companies in batches, and assigned a third-party company to register and set up 962 conference service companies at the same address in the form of "cluster registration". The third-party company further decomposed the funds according to the requirements of Guangzhou Poinsettia Company and transferred them to specific personnel accounts to pay the public relations expenses of hospitals in various regions.
Livzon Group set up a consulting company through its employees to collect funds of 12.4001 million yuan, and the funds were transferred to the personal accounts of relevant employees for drug public relations.
In addition to pharmaceutical manufacturers, the audit investigation team also found that pharmaceutical consumables distribution enterprises increased intermediate sales links and pushed up the circulation price of medical equipment. The enterprises involved include Kangchao Pharmaceutical Co., Ltd. and Sinopharm Equipment (Dongguan) Co., Ltd., and the products involved include Cao Qinghua Yixin Chushi Zhitong Capsule and other high-value medical consumables such as spinal internal fixators.
It is worth noting that there are also public hospitals that increase procurement intermediate links to make profits to subordinate enterprises. For example, from 2020 to May 2023, the Cancer Hospital affiliated to Sun Yat-sen University appointed Guangdong Guanhua Medical Service Company, a subsidiary of the trade union, to supply medical consumables for it, and Guangdong Guanhua Medical Service Company made a profit of 7,488,200 yuan, with an average price increase rate of 6.6%.
Medical personnel have long accepted the benefits delivered by pharmaceutical companies.
Audit investigation shows that domestic authoritative medical experts have long accepted exclusive service arrangements of foreign-funded pharmaceutical enterprises. Kehui Medical Devices International Trade (Shanghai) Co., Ltd. (hereinafter referred to as "Kehui Company") is a wholly foreign-owned enterprise, which mainly sells Covidien brand medical devices, and has long sponsored academic exchange activities organized by medical and pharmaceutical associations at all levels in China, and requires domestic distributors to pay accommodation, transportation, air tickets and other expenses for participating doctors and experts according to 2% of annual sales.
The audit spot check found that in 2022, Foshan Tailing Trading Co., Ltd., the brand distributor, paid 15.8117 million yuan for transportation, accommodation, catering and other expenses for medical experts and related personnel through nine travel agencies according to the instructions of Kehui Company, of which only one travel agency provided special follow-up, special car transfer and gifts for 272 authoritative experts in the medical field in China (including 63 in Guangdong Province) in seven meetings.
In addition, 4,782 medical staff illegally accepted the benefits delivered by foreign-funded pharmaceutical companies in the name of conference registration fees, involving pharmaceutical companies such as Bayer Healthcare Co., Ltd.
In addition, four medical experts from public hospitals received a targeted donation of 2.37 million yuan from pharmaceutical companies through the foundation of Guangdong Medical Association, involving five pharmaceutical companies including Beihai Kangcheng (Shanghai) Biotechnology Co., Ltd.
Medical institutions illegally purchase or use medical devices.
The audit investigation found that medical institutions illegally purchase or use medical devices, which has hidden hidden dangers of life and health and financial security.
The audit spot check found that three medical institutions, including Zengcheng Branch of Southern Hospital of Southern Medical University (hereinafter referred to as Zengcheng Branch of Southern Hospital), had problems such as determining the winning bidder in advance and purchasing large-scale medical equipment at a high price, involving funds of 73.0828 million yuan (including equipment price increase of 30.209 million yuan).
For example, in 2020, the then president of Zengcheng Branch of Southern Hospital organized the head of the department to conduct a feasibility study on purchasing X-ray computed tomography scanner, and determined the equipment of American GE Company quoted by Guangzhou Tangyun Medical Equipment Co., Ltd. In June 2021, the enterprise actually controlled by the company won the bid with the same brand and model equipment, with the winning bid amount of 29.49 million yuan, the purchase price of which was 14.287 million yuan, and the difference reached 15.2 million yuan.
In addition, the audit survey found that from 2018 to May 2023, a total of 491 medical institutions in Guangdong Province entrusted Guoyi Tendering Co., Ltd. to carry out bidding for more than 10,000 large-scale medical equipment or consumables procurement projects, with a total project amount of 22.386 billion yuan. Among them, only 3 companies participated in the bidding for nearly 9,000 projects.
Zengcheng Branch of Southern Hospital illegally purchased a proton radiotherapy system equipment without the permission of National Health Commission Class A large-scale medical equipment configuration, and paid 50% of the purchase price of 120 million yuan from the special government debt before the main components were shipped.
In terms of illegal use of medical devices, two medical institutions, including Zhongshan People’s Hospital, repeatedly used 2409 disposable ultrasonic blades, involving 15,100 person-times, involving medical insurance fund of 7,730,600 yuan. The Stomatological Hospital of Southern Medical University applied the "ultrasonic osteotome" used in the operation to the charging item of "additional ultrasonic scalpel", and illegally charged 67.2031 million yuan for medical treatment and 5.7011 million yuan for medical insurance fund.
The audit investigation also found that Guangdong Medical Association received 52,056,200 yuan from 329 pharmaceutical companies to designate doctors to promote their products. Guangdong Medical Association fraudulently distributed lecture fees and preparation fees of 169,600 yuan to medical experts in violation of regulations.
It is worth noting that the audit survey results also pointed out that Guangdong Province attaches great importance to the high-quality development of the pharmaceutical industry, actively promotes comprehensive reforms in the pharmaceutical field, and continuously optimizes the business environment of pharmaceutical enterprises, achieving good results. In view of the problems found in the above audit investigation, the audit investigation team also gave a number of suggestions.
On August 8, Economic Observer Network called the investor relations department of Livzon Group several times, but it was not connected. Ask Bayer China for an interview and get no reply; The relevant person in charge of Beihai Kangcheng responded that his company had not received a notice to cooperate with the investigation, and it was not clear about the specific situation.
Original title: Medical Corruption in an Audit Investigation Report
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