Novartis lawyer steps down over Trump lawyer payment

Zurich (AFP) –


Swiss pharmaceutical giant Novartis on Wednesday announced the retirement of its top legal expert, as he apologised for payments made by the firm to Donald Trump's personal lawyer Michael Cohen.

The announcement comes after Novartis was dragged into the scandal over Cohen's payment of $130,000 to US porn actress Stormy Daniels just days before the 2016 presidential election.

Trump has denied having an affair with Daniels or knowing anything about that payment but his new lawyer Rudy Giuliani has acknowledged the US president had in fact reimbursed Cohen for the payoff.

Last week, Daniels' lawyer Michael Avenatti wrote on Twitter that Novartis and US telecoms giant AT&T had used the services of Cohen's firm Essential Consultants -- the same company used to make the payment to Daniels.

Cohen is currently under investigation for accepting payment from companies and others seeking access to the White House, as well as for the payment to Daniels, who says she had an affair with Trump around a decade ago.

The FBI on Monday raided the offices of Cohen, a move that Trump angrily denounced as a "disgrace" and "whole new level of unfairness".

On May 9, Novartis said it had signed a one-year contract for $100,000 a month with the firm in February 2017, seeking advice on the new administration's public health policy.

"Novartis believed that Michael Cohen could advise the company as to how the Trump administration might approach certain US healthcare policy matters, including the Affordable Care Act," Novartis said.

Following a meeting with Cohen, the company determined that he and his firm would in fact not be able to provide the services it sought, it explained.

- Scandal in Greece -

However, the contract could not immediately be terminated and Novartis had to wait until the full $1.2 million had been paid to Cohen's company.

AT&T, which has acknowledged paying some $600,000 to Cohen and was also named by Daniels' lawyer, has also said it was a "big mistake" and a "serious misjudgement" to hire Trump's lawyer, even as it maintained its actions were legal.

On Wednesday, Novartis's general counsel Feliz R. Ehrat apologised for making the deal in the first place.

"Although the contract was legally in order, it was an error. As a co-signatory with our former CEO, I take personal responsibility to bring the public debate on this matter to an end," Ehrat said in a statement issued by the firm.

Ehrat will be replaced starting from June 1 by Shannon Thyme Klinger, who is currently Novartis's ethics, risk and compliance officer.

Novartis has also insisted that its CEO Vas Narasimhan was "in no way involved" with the agreement with Cohen's firm, which predated the start of his term.

The shake-up follows a spate of trouble for the pharmaceutical behemoth in Greece, where the firm is accused of making illicit payouts to decision-makers and doctors between 2006 and 2015 to secure inflated prices for its products even though cheaper alternatives were available.

The case is under examination by the Greek and US authorities.