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Prosecutor General’s Office hands over Diavita case from the Military Prosecutor’s Office to NABU 

26.10.2018

Subject of complaint: Chief Military Prosecutor's Office of the Prosecutor General’s Office of Ukraine (Military Prosecutor's Office) and individual SSU employees.

Complaint in brief: On July 7, 2017, Diavita company, an official distributor of Baxter, the American pharmaceutical corporation, appealed to the Business Ombudsman Council. The company complained about illegal actions of the Military Prosecutor's Office officials. 

Baxter is the world’s leader in peritoneal dialysis (PD), a therapy for the sick suffering from chronic renal insufficiency. The PD is based on metabolism between the patient’s blood and the dialysate solution through the peritoneum. The patients independently perform such procedures 4 times every day. It is worth pointing out that medicines for PD cannot be changed in the process of treatment. As the world clinical practice shows, transition to a solution from another manufacturer carries high risks of infection, is dangerous and, therefore, unacceptable. 
 
Apart from the fact that treatment is daily, it is high-tech and expensive, and the state provides it to patients. At the same time, the level of provision with therapy in Ukraine is one of the lowest in Europe. And any supply disruptions endanger lives of thousands of people. 
 
In November 2015, on the suggestion of the State Security Service of Ukraine (SSU), Kyiv Prosecutor's Office launched a criminal case against the company. It was accused of overpricing PD goods. However, the Complainant proved that prices are not inflated because the products for dialysis are imported transparently - without involvement of intermediary companies non-residents, under the direct contract with the manufacturer.

After that, law enforcers questioned the volume of procurement of medicines. In their opinion, the need for public tenders was overestimated. The Complainant, instead, provided statistics: the level of provision with PD medicines per patient in Ukraine was 4-5 times lower than in neighboring countries. 
The company felt quite a big pressure on the part of law enforcers. The SSU repeatedly sent letters to hospitals, where it discredited the company, interrogated doctors. Law enforcers conducted searches in Diavita office and Baxter representative office, as well as at Complainant’s employees’ places. 
 
Not having found the crime, in July 2016 a criminal case was closed. However, in five weeks, a new one was initiated. The proceeding was opened on the procurement of goods for peritoneal dialysis of Baxter production, the operational support of another criminal proceeding was carried out by the same employees of the Department of Economic Counterintelligence of the SSU. At the same time, separate commercial structures began to massively prevent the supply of goods for peritoneal dialysis by appealing all purchases in the Antimonopoly Committee of Ukraine. Moreover, in the fall of 2016, the case was handed over to the Military Prosecutor's Office. The reason for this, according to the Prosecutor's Office itself, was the appeal of the Union of Disabled People, whose members are pensioners-military servants. 
 
Actions taken: Based on the compliant review results the Council concluded that the investigation of the criminal proceedings against the Complainant had the signs of such carried out by the Military Prosecutor's Office with violation of jurisdiction rules. The Council recommended that the Prosecutor General's Office investigate the circumstances of the complaint and, in case of their confirmation, consider the issue of changing jurisdiction in criminal proceedings. 
 
Result achieved: The Prosecutor General’s Office accepted the Council’s arguments and handed the case over to NABU. The Complainant thanked the Council for assistance and confirmed that law enforcement officers no longer put pressure on his business.