ECONOMY

All not well with hospital supplies

Cases of under-the-table commercial transactions currently under investigation are growing across the world. One such case involving Greece, regarding a subsidiary of a multinational group in orthopedic equipment and products, is being scrutinized by British and US justice. The subsidiary was condemned by its own parent company for unacceptable sales practices in Greece. British press reports recently spoke of an official investigation into an orthopedic products firm and the decision of its foreign parent company to order the termination of its activities in Greece, owing to «unfair and illegitimate sales tactics.» The subsidiary earned 60 percent of its income in Greece, being among the firms with the largest share in the specific market. Kathimerini has the names of all companies involved but will not release them as the investigation is ongoing. The New York and London Stock Exchange-listed parent company’s CEO made a statement but did not give further details: «We decided to cease operations in Greece by our subsidiary as we established that it used illegitimate and unacceptable sales tactics, even though we will suffer an estimated drop in sales of up to 100 million euros in 2008.» Kathimerini contacted the British parent company’s press official, who however declined to make any comment. Handouts The term «handouts,» as used in Greece, or «sensitive fees,» as used in a study by European Profiles SA into medical products, refers to the high commissions paid to the «appropriate» persons, i.e. scientists, administrative hospital or social security fund staff. In addition to money, such handouts also include luxury trips, free surgical equipment and other «gifts,» all aimed at boosting a specific company’s sales. There is increasing talk of black money being used by various commercial companies in the health sector to reward the closing of deals. «The bigger the order, the bigger the handout,» said a medical professional who wished to remained anonymous. The bribes are often so tempting that they may lead to the products of a certain company being preferred over those of a competitor, even if their quality is inferior, provided they meet the required standards. A handout, according to sources, usually ranges between 10 percent and 20 percent of the value of an order, but some companies are said to go even higher, to 30 percent.