AstraZeneca Fraud Case: Over 100 Employees Involved, Medicare Fund Loss Exceeds 1.44 Million

The AstraZeneca employee fraud case involves sales personnel in China who allegedly forged or altered tumor gene testing reports to defraud the national Medicare fund, particularly concerning AstraZeneca's lung cancer treatment drug, Tagrisso. This case, revealed in July 2021, has seen an expanding scope of investigation and an increasing number of implicated personnel, including frontline sales representatives, regional managers, and directors, with over a hundred former employees convicted of fraud.

In the tumor gene testing industry, numerous compliance issues exist. A former employee of Eideson Bio was accused of colluding with AstraZeneca sales personnel to alter gene testing reports, leading to over 1.44 million yuan being paid from the Shenzhen Medicare fund for osimertinib. AstraZeneca's osimertinib (brand name: Tagrisso) is the world's first approved targeted therapy for locally advanced or metastatic NSCLC with EGFR T790M mutations.

From October 2018 to March 2021, Tagrisso was included in Medicare reimbursement conditions, limited to patients with positive T790M tests. The former employee claimed that the report alteration was directed by their supervisor and AstraZeneca's sales team leader, though the supervisor maintained that such actions were not authorized, emphasizing the strategic partnership between the company and AstraZeneca.

Eideson Bio stated in March 2023 via its investor platform that the report alteration was a severe violation, not only defrauding the Medicare fund but also posing serious risks to cancer patients. The company emphasized that its medical testing institute adheres to legal regulations and ethical standards, ensuring the traceability and verification of original testing data.

Two key figures from Ruiang Gene were detained by law enforcement for suspected illegal operations and fraud, with formal arrests made on December 9, 2024. Ruiang Gene provides third-party medical testing services, and its chairman and general manager, Xiong Hui, as well as the vice-chairman and deputy general manager, Xiong Jun, were taken into custody following their supervision. An announcement on October 25 indicated that four senior executives were detained for fraud, followed by the arrest of Xiong Hui and Xiong Jun on December 5.

The ongoing fallout from the AstraZeneca employee fraud case has led to over a hundred employees being sentenced, while AstraZeneca's former president in China and several vice presidents are under investigation. This incident serves as a warning to the entire tumor testing industry.

AstraZeneca China was previously active in the tumor gene testing field, signing strategic cooperation agreements with multiple diagnostic companies to build a lung cancer diagnosis and treatment ecosystem. However, the fraud case has also implicated Kingmed Diagnostics, which cooperated with the investigation but found no records of falsified patient tests.

Following the discovery of Medicare fraud, AstraZeneca China has strengthened compliance management, replacing most executives in the oncology business and continuing investigations and compliance efforts. The company globally employs over 200 compliance personnel, with a dedicated compliance team in China providing mandatory training for sales personnel and monitoring corporate communications to mitigate risks related to personal data violations.

A notification issued by 14 ministries, including the National Health Commission, explicitly states the need to rectify unethical practices in the pharmaceutical purchasing and sales sectors, including "kickback sales" and fraudulent "external testing" arrangements. The gene testing industry now faces a moment of self-examination.