Bernadus Karmin Winata, Kalbe Farma Director

Tempo

In the health industry, it has been long-established that doctors and medical representatives from pharmaceutical companies enjoy a mutually beneficial relationship. Marketers persuade doctors to prescribe their brand to patients. In return, doctors receive bonuses and commissions up to millions of rupiah every month camouflaged in various forms of programs such as seeding trials and luxurious facilities for training or health seminars.

Such practices ended after, in 2016, Tempo published its investigative report on the bribery given to doctors by Interbat Pharmaceutical—an Indonesian pharmaceutical company founded in 1948. The Corruption Eradication Commission (KPK) banned such practice of transferring money directly to doctors’ personal accounts, and the health ministry published Ministerial Regulation No. 58/2016, which further strengthened the ban.

But the practice has continued. Doctors have been receiving bribery until today, but through more systematic methods. Tempo received a stack of documents that record transfers made by Kalbe Farma to doctors at a number of hospitals in Jakarta. To obtain an explanation, Tempo interviewed Kalbe Farma Director Bernadus Karmin Winata.

He explained that the bribery practice stopped when the health ministry published the previously mentioned regulation. “We have been applying business ethics for 10 years,” said Karmin on October 23 at Penang Bistro Kebon Sirih, Jakarta, where he was accompanied by Hari Nugroho, Kalbe Farma senior external communications manager.

According to the documents we received, the money transfers to doctors were made on the approval of Kalbe Farma’s management. How do you explain this?

We don’t understand. Kalbe has forbidden such practices since before the National Health Insurance (JKN) era in 2012.

Based on the documents, the transfers occurred in 2013-2016, after the JKN period.

I don’t understand. In my opinion, Kalbe has never performed such actions because we are listed at the stock exchange as a publicly listed company. Outside investors already asked about this around 15 or 20 years ago.

(Tempo showed documents of transfers, among others, a document mentioning a transfer from Kalbe’s Pulomas branch.) Are these documents valid?

Hari: We don’t have this type of system because there are no Kalbe logos. All of our documents carry the Kalbe logo. The customs identification number (NIK) is also different from mine. And we don’t have a branch in Pulomas.

The names Ridwan Ong and Rustam Tan are on the documents. Do they work at Kalbe?

Ridwan is still at Kalbe, in marketing. Rustam has transferred to a Kalbe subsidiary.

So if Kalbe was unaware of these transfers but the company’s medical representatives made them on behalf of Kalbe, where did the money come from?

Don’t know. It seems like there was double bookkeeping. But I guarantee that double bookkeeping is impossible at Kalbe because we are strictly audited.

Why would medical representatives transfer money to doctors?

It could have been for a number of reasons. From the medical representatives’ side, maybe they had personal interests.

Is it because they had to meet their sales target?

Maybe. If the motive was personal, it becomes difficult. But it’s a bit strange. How did the medreps know that a doctor would recommend their products? (It’s) difficult. How would we know what they would prescribe? At Kalbe we clearly have business ethics that must be upheld.

Would people who are found to have violated the ethical code be sanctioned?

Of course sanctioned if found out.

What is the sanction?

We would certainly dismiss them.

Medical representatives are part of Kalbe?

Yes, their job is to explain the products.

We also found transfers to hospitals.

If (they’re) made to hospitals, then it’s more for research. Now medicines are already using the tender system. This is why the supply of medicines at hospitals are left to the management. So we speak to the management. In the JKN era, it was already irrelevant for us to speak to doctors because the cooperation had to be B to B (business to business), between Kalbe and hospitals, not with individuals. According to Health Ministerl Regulation No. 58/2016 promotional fees as part of education are still allowed.

Not for providing discounts?

Are discounts allowed or forbidden? (It’s) allowed, because we’re talking about trade.

We found that discounts are not recorded in receipts because the money is returned as bribery to hospital managements.

We have to look again, is it already in line with regulations? Because we are talking about institutions. In the healthcare industry, drug sales are only a small part of their business. 

There is also honorarium and seminar fees. What are they?

We take part in educating doctors by providing training. The training is inter-institutional, so that they can provide proper services. What is the motive? By providing training, we are hoping for a better network.

We went to the Pramuka Market in East Jakarta. There Kalbe medicines are sold without prescription.

They are just stray individuals. Just imagine, when there is report of counterfeit medication, we are the ones summoned when other people are the ones supplying it. We are assigned blame because we are seen as incapable of monitoring.

Are the medicines sold at Pasar Pramuka counterfeit or smuggled?

If taken from the factory it’s impossible, but it’s possible that some outlets are playing games. What’s certain is that we supply medicines to those with licenses, pharmaceutical licenses and drugstore licenses, through our distributor.

By the way, what is Kalbe’s annual budget for marketing?

Around 15 percent of the total sales of Rp23 trillion. Marketing fees are legal, regulated under health minister regulation on sponsorship. We spend on marketing to improve the competency of doctors, on research and on education in the health industry.

Are these marketing fees transferred directly to individuals?

Only to institutions. We are allowed to sponsor doctors to attend seminars, but only through their institutions. It may be a hospital, an association, or others. We may have an interest in one doctor (in particular), but the institution is also entitled to appoint another doctor.