Published: Thu, May 17, 2018
IT | By Emmett Cole

Payments to Trump's lawyer lead drug firm lawyer to quit

Payments to Trump's lawyer lead drug firm lawyer to quit

Shannon Thyme Klinger, now Novartis' Chief Ethics, Risk and Compliance Officer, will take over the Group General Counsel role from 1 June, and the company has signalled that its compliance and ethics measures will be tightened in response to the affair.

Last week, Daniels' lawyer Michael Avenatti wrote on Twitter that Novartis and USA telecoms giant AT&T had used the services of Cohen's firm Essential Consultants - the same company used to make the payment to Daniels.

"Although the contract was legally in order, it was an error", said Ehrat, 61, in a May 16 statement.

Trump has denied having an affair with Daniels or knowing anything about that payment but his new lawyer Rudy Giuliani has acknowledged the USA president had in fact reimbursed Cohen for the payoff.

In the end Novartis only met Cohen once, before deciding that the arrangements would not provide any useful information, but the Swiss firm continued to make monthly payments of $100,000 over the course of a one-year period.

Jimenez said in the interview that a "third party" had recommended Cohen to Novartis, declining to identify that person.

On Wednesday, Novartis's general counsel Feliz Ehrat apologised for making the deal in the first place.

"Michael Cohen was somebody who was introduced to us, and he was unknown to us, but he was said to be somebody who could help", Jimenez said. Novartis stock, which trades through American Depositary Receipts on the New York Stock Exchange, has moved less 1% since news of the payments broke.

A USA probe into whistleblower allegations that the company offered kickbacks to doctors via fancy dinners shamming as educational events.

It was revealed that the telecommunications giant made $600,000 in payments to Cohen's firm, Essential Consultants.

Novartis had not acted on the advice and Cohen had never provided any access to anyone in the administration, said Jimenez.

Ehrat's resignation coincides with a "Meet Novartis Management" investor day being held at the company's headquarters in Basel today, where the company would rather discuss its business and pipeline, but will undoubtedly face further questions about its corporate governance.

Jimenez said he had wanted to terminate the 12-month deal with Essential Communications as soon as he realised this was the case but decided against doing so because of potential legal costs involved - a decision he now considers a "mistake".

Novartis CEO Narasimhan this week conducted a conference call with 5,000 managers in which he said the firm needed to re-examine its lobbying practices, Bloomberg said, citing a source close to the matter.

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