AUTH/3285/12/19: Ex-employee v Daiichi-Sankyo – Underreporting transfers of value on Disclosure UK

• An ex-employee complained that Daiichi-Sankyo’s 2018 Disclosure UK entries showed healthcare professional registration fees of £7,937.60 for named individuals and zero in aggregate, which the complainant alleged was gross underreporting.
• The complaint focused on sponsorship for the European Society of Cardiology (ESC) congress in Munich, Germany (August 2018), alleging the company sponsored around 100 healthcare professionals and paid travel, accommodation, food and registration fees, but many individuals could not be found on Disclosure UK and aggregated reporting was zero.
• Daiichi-Sankyo submitted it funded flights, accommodation and congress registration for 98 health professionals for ESC 2018; and paid travel, accommodation and registration fees for 28 health professionals for ESC 2017 and 15 for ESC 2016.
• Daiichi-Sankyo acknowledged that the relevant transfers of value for these congress attendances were not reported on Disclosure UK (neither individually nor in aggregate).
• Daiichi-Sankyo said the omission related to indirect transfers of value where administration/logistics were contracted to a third party; the supporting file with per-HCP transfer-of-value details was either not provided by the third party or not formally requested by Daiichi-Sankyo at the time.
• The company described weaknesses in its review process, including reliance on financial system reports that did not contain itemised HCP transfer-of-value data for these activities, and lack of sign-off by departmental heads with budget responsibility; it also cited lack of training and absence of an SOP at the time (an SOP was prepared after the complaint was received).
• When asked to quantify unreported transfers of value for 2018–2016, Daiichi-Sankyo stated it did not have complete visibility, but identified around £471,000 as unreported across events/years (including ESC 2018, ESOC 2018, ETNA 2018, ESC 2017, ESC 2016).

• The Panel ruled that the information published on Disclosure UK at the time of the complaint was not comprehensive for conference support in 2018, 2017 and 2016.
• The Panel ruled breaches of Clauses 22.5, 24.1, 24.4, 24.7 and 24.9 (as acknowledged by Daiichi-Sankyo) in relation to omitted transfers of value and failure to disclose by the required deadline, including failure to disclose either individually or in aggregate.
• The Panel ruled a breach of Clause 24.6 (record retention/documentation), finding Daiichi-Sankyo had not been able to produce all relevant data and noting inconsistencies, despite the company’s denial.
• The Panel ruled no breach of Clause 24.10 (methodological note), and this was upheld on appeal because there was insufficient evidence to establish a breach.
• The Panel ruled breaches of Clause 9.1 (high standards) and Clause 2 (bringing discredit), citing the scale and seriousness of the underreporting and inadequate processes.
• The Panel reported Daiichi-Sankyo to the Appeal Board under Paragraph 8.2 of the Constitution and Procedure due to concerns about the company’s procedures.
• The Appeal Board concluded there was a fundamental and systemic failure of processes and a misunderstanding of Code requirements over a three-year period, and decided Daiichi-Sankyo should be publicly reprimanded and required to undergo an audit of its procedures in relation to the Code.
• Following audits and re-audits (September 2020; May 2021; March 2022; November 2022), the Appeal Board ultimately decided that no further action was required (on the basis improvements continued and commitment to compliance was maintained).

• Clause 2 – Breach ruled (particular censure due to failure to disclose required information and scale of underreporting; inadequate process).
• Clause 9.1 – Breach ruled (high standards not maintained).
• Clause 22.5 – Breach ruled (omitted 2018, 2017 and 2016 data).
• Clause 24.1 – Breach ruled (failure to document and publicly disclose transfers of value).
• Clause 24.4 – Breach ruled (failure to disclose by 30 June of the relevant year).
• Clause 24.6 – Breach ruled (documentation/record retention for 5 years).
• Clause 24.7 – Breach ruled (failure to disclose transfers of value to individuals or in aggregate, as applicable).
• Clause 24.9 – Breach ruled (failure to disclose transfers of value to individuals or in aggregate, as applicable).
• Clause 24.10 – No breach ruled (methodological note requirement met; no evidence provided to establish breach; upheld on appeal).

• Public reprimand (Appeal Board, Paragraph 11.3 of the Constitution and Procedure).
• Audit of Daiichi-Sankyo’s procedures in relation to the Code, to take place as soon as possible; the Appeal Board would consider whether further sanctions were necessary on receipt of the audit report.
• Re-audits required (March 2021, deferred to May 2021; March 2022; October/November 2022) with ongoing Appeal Board oversight; ultimately no further action required after the November 2022 re-audit report.

Why this matters: Disclosure UK reporting is a core transparency commitment. This case shows that indirect spend routed via third parties (e.g., congress agencies) can still be the company’s responsibility to capture, validate, retain and disclose—at scale and across years.

Where teams typically slip up (interpretation):

• Assuming finance-system outputs are “complete” when indirect transfers of value are paid via agency invoices without per-HCP itemisation.
• Letting ownership drift between events/marketing, procurement, finance and compliance—so no one budget owner signs off completeness of the disclosure dataset.
• Relying on a methodology note or informal practice without an operational SOP, training, and evidence trail that covers indirect transfers of value end-to-end.

The control that would have prevented it: A mandatory “no pay without ToV file” procurement control for third-party event suppliers, requiring a standardised per-HCP transfer-of-value schedule (registration, travel, accommodation, etc.) as a condition of invoice approval, plus budget-owner sign-off and compliance/finance reconciliation before Disclosure UK submission.

What I’d check in the job bag:

• Supplier contract/SOW clauses requiring provision of per-HCP ToV data and timelines aligned to Disclosure UK deadlines.
• Invoice pack completeness: ToV supporting file present, validated, and mapped to HCP identifiers; evidence of follow-up where data was missing.
• Reconciliation between event attendee lists, internal meeting/event systems, and the Disclosure UK extract (including aggregate vs named logic).
• Documented sign-offs by departmental budget owners and final sign-off by finance/compliance leadership.
• SOP and training records showing roles/responsibilities for indirect ToVs and record retention expectations.
• Record retention evidence demonstrating the company can reproduce the disclosed dataset and underlying source files for 5 years.

What the sanctions tell you (interpretation):

• A public reprimand signals the regulator viewed the failure as serious and systemic, not a minor administrative error.
• Repeated audits/re-audits indicate the expectation of demonstrable, sustained governance and culture change—not just a one-off correction.
• Ongoing oversight until “no further action” suggests the regulator needed evidence that controls were embedded and operating effectively over time.

3 questions to ask your team this week:

1. Which of our ToVs are “indirect” (agency-managed) and what is our documented control that prevents payment without per-HCP ToV itemisation?
2. Who signs off completeness of ToV capture for each budget area, and what reconciliation proves we didn’t miss congress/event activity?
3. If a regulator asked tomorrow, could we reproduce the full ToV dataset (including source files) for the last 5 years?