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The Ontario government has fined Costco over $ 7 million following an investigation into illegal bribes in 29 drugstores in warehouses across the province.
Nathan Denette / THE CANADIAN PRESS
The Ontario government fined Costco more than $ 7 million after discovering that the company had accepted illegal bribes at 29 drugstores in warehouses across the province.
The Ontario Ministry of Health announced Friday that it would sanction CWC Pharmacies (Ontario) Ltd. after finding that the company had received illegal advertising payments by August 2015.
According to the Government, the company asked the department to confirm the legality of the payments, which Costco voluntarily ceased to receive until the completion of its review.
The inspection revealed that Cosctco had received $ 7.25 million for advertising services which, according to the department, contravened its conditions for accepting rebates.
According to a Costco statement, generic companies made the necessary payments to reduce processing fees and drug surcharges, and the group agreed to pay the penalty fees.
According to the statement, although the company considered the payments to be legal at the time, it fully cooperated with the ministry's investigation and acknowledged that the payments were not in compliance with the Ontario rebate laws.
According to the Ministry, the Ontario government prohibits the operator of a pharmacy from accepting discounts from a drug manufacturer whose product is on the provincial drug database.
CWC Ontario is a "wholly-owned subsidiary" of Costco Wholesale Canada Ltd., according to the Costco Pharmacy Web site.
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