Former Servier number two Jean-Philippe Seta (right) received a suspended sentence. AFP
Former Servier number two Jean-Philippe Seta (right) received a suspended sentence. AFP
Former Servier number two Jean-Philippe Seta (right) received a suspended sentence. AFP
Former Servier number two Jean-Philippe Seta (right) received a suspended sentence. AFP

Drugs giant Servier convicted in French diet pill scandal where hundreds died


Simon Rushton
  • English
  • Arabic

Pharma giant Servier has been convicted of manslaughter after selling a diabetes and diet pill that caused the deaths of hundreds of people.
The French company was fined 2.7 million euros ($3.2 million) and its former deputy chief, Jean-Philippe Seta, sentenced to a four-year suspended jail sentence.
Servier and the Mediator scandal had "weakened people's trust in the health system", presiding judge Sylvie Daunis said in Paris.
"Although they knew about the risks for many years ... they never took the necessary measures", Judge Daunis said.
The Servier case was one of France's biggest health scandals involving between 500 and 2,000 deaths and more than 6,500 plaintiffs.

French pulmonologist Irene Frachon holds a photobook of the 'Mediator victims'. AFP
French pulmonologist Irene Frachon holds a photobook of the 'Mediator victims'. AFP

The company "misled" consumers, Judge Daunis said, fining the company for manslaughter, causing unintentional injury and aggravated deception. The firm was acquitted of fraud.
Servier sold Mediator as a diabetes and weight loss pill for 33 years. It was used by about five million people before finally being pulled in 2009 over fears it could cause serious heart problems.
They were first warned about potential problems as early as 1998 when a doctor flagged worries. That doctor testified he was bullied into retracting his concerns.

Servier was accused of putting profits ahead of patients' welfare by allowing the drug to be widely and irresponsibly prescribed as a diet pill — with deadly consequences. Servier argued that it didn't know about the drug's dangers.
Between 1997 and 2004, Servier withdrew Mediator from the Swiss, Spanish and Italian markets as they faced questions about the drug's side effects from medical authorities in those countries.

It continued selling the drug in France until 2009.
Many of the victims who testified in court about the impact of the drug on their lives were women.
"It was said that the drug was extraordinary. I lost 10 kilos the first month," said one plaintiff, Stephanie, who took the drug for three years before being diagnosed with heart disease in 2009.

France's medicines agency was fined 303,000 euros for its delay in suspending the use of the drug.

In a damning verdict for the regulator, the court convicted it of manslaughter and causing unintentional injury, saying it "seriously failed in its role as health watchdog".

A 2010 study said Mediator was suspected in up to 2,000 deaths, with doctors linking it to heart and lung problems.
Some survivors suffered severe health complications, requiring heart transplants and other medical procedures, after taking the drug as a hunger suppressant.
The court also ordered Servier to pay hundreds of millions more in damages that will be shared out by plaintiffs. Damages for aggravated deception alone totalled €59 million.
Lawyers for Servier argued that the company was not aware of the risks associated with Mediator before 2009, and said the company never claimed it was a diet pill. They had argued for acquittal.
The company's CEO and founder, Jacques Servier, was indicted early in the legal process but died in 2014.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”