PRIVATE & CONFIDENTIAL

Report on Comprehensive Review

of free goods issued by Innovative
Medicines Division of
Novartis (Bangladesh) Limited

Mak & Co.

Chartered Accountants
Member Firm of SFAI, USA

102 BSEC Bhaban (11th Floor)

Kazi Nazrul Islam Avenue,
Kawran Bazar, Dhaka- 1215

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 Executive Summary
Management of Novartis (Bangladesh) Limited (NBL) assigned Mak & Co. to thorough
review and checking of all free goods issued by Innovative Medicines division for the
period from 1 January 2020 to 30 September 2020.

NBL, as part of its promotional activities, distribute free goods against preset terms and
conditions. Issue of free goods done through its delivery partner PharmaSolutions.
PharmaSolutions branches archives the necessary audit trail for free goods issued.

Scope of work

- Review of internal control mechanism for free goods issue.

- Conduct verification to confirm authenticity of free goods issue
- Examine whether free goods are issued to eligible recipients as defined by IMD of
NBL with sufficient audit trial in place

Summary of procedure

Mak & Co. performed a thorough review and checking of free goods issued by Innovative
Medicines division in the category of Exelon Patch 5, Exelon Patch 10 & Exelon Patch
15, ,Glivec 100mg, Tasigna 200mg, Afinitor 5mg, Afinitor 10mg, Jakavi 5mg, Cosentyx
150mg/ml. Our review focused on testing various policies and procedures and internal
controls, including: approving and issuing of free goods, verification of supporting
archived by PharmaSolutions branch, and authenticity of free goods issue.

We performed the following procedures:

- Obtained an understanding of free goods issue procedures through review free
goods process flow.
- Obtained details list of free goods issued during the period
- Conduct physical verification of supporting archived by PharmaSolutions branch
- Tested a sample authenticity of free goods issue over phone

Summary of Observation

During our review procedure, we have observed some deviation or discrepancy from
standard. Some of them are extracted as follows:
1. Internal Control mechanism for free goods issue
Overall Control Mechanism is satisfactory, but there is scope for improvement in
control activities and monitoring systems.
2. Summary of verification work:

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 Number of free Number of free goods Difference
goods distirbuted as as per physically (Excess)/
Products per Novarties record found audit trails Short
2020 2020 2020
Exelon Patch 5 23 23 -
Exelon Patch 10 61 61 -
Exelon Patch 15 69 69 -
Glivec 100mg 105 105 -
Tasigna 200mg 70 70 -
Afinitor 5mg 27 27
-
Afinitor 10mg 30 30 -
Jakavi 5mg 46 46 -
Cosentyx 150mg 161 161 -

3. Missing Audit Trails

Most of the cases PharmaSolutions branch didn’t archived the required audit trails
as per Free Goods Distribution policy

Contents
1. Internal Control mechanism for free goods issue...........................5
2. Summary of Finding: Exelon Patch................................................6
3. Summary of Finding: Glivec...........................................................7
4. Summary of Finding: Tasigna.........................................................8

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5. Summary of Finding: Afinitor.......................................................9
6. Summary of Finding: Cosentyx....................................................10
7. Summary of Finding: Jakavi ........................................................................11

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 1. Internal Control mechanism for free goods issue
Overall Observation of Internal Control mechanism for free goods issue

Components of Satisfactory Need Inadequate

Internal Control Improvement
Control Environment √
Risk assessment √
process
Information and √
communication
Control activities √
Monitoring √

Remark
Overall Control Mechanism is satisfactory, but in the following areas there is scope for
improvement:
- As per PharmaSolutions management, there is verbal insturction for not maintaining
some audit trial in some case. Novartis management should ensure formal communiation
in all cases
- As per PharmaSolutions management, some audit trails were missing during the time of
office shifting. Novartis should stablish control policies to avoid such circumstances
- Novartis should have internal checking activities in regular interval
- Novartis should have written policy to destry/diposal of some of audit trails like
prescription, strips etc. in regular interval.

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 2. Summary of Finding: Exelon Patch

Finding 2020
Sign missing on invoice 9
Sign missing on invoice & No prescription 1
IPM Book found instead of empty box 2

6
 3. Summary of Finding: Glivec
Finding 2020
NOC missing 1

7
 4. Summary of Finding: Tasigna
Finding 2020
Commercial invoice missing
1
NOC missing 1

8
 5. Summary of Finding: Afinitor
Finding 2020
No finding 0

9
 6. Summary of Finding: Cosentyx
Finding 2020
Invoice missing
1

10
 7 Summary of Finding: Jakavi
Finding 2020
No finding 0

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