Dong Sung Pharmaceutical has faced penalties from South Korea's Fair Trade Commission for allegedly providing illegal financial incentives totaling about 250 million won to doctors at four clinics in the capital region from 2010 to 2014. The company was found to have funneled these rebates through its affiliate, Dong Sung Biopharm, which collected prescription data and converted incentive amounts into gift certificates that were then cashed out and distributed to the medical professionals. The commission decided to issue a corrective order while exempting the company from any fines due to its ongoing rehabilitation process.

Following the regulatory scrutiny, Dong Sung Pharmaceutical shifted its marketing strategy in mid-2014 by fully outsourcing its prescription drug sales to a marketing agency. This new approach involved convincing some staff from Dong Sung Biopharm to establish a new agency and entering into a contract to pay commission fees that included rebate costs, which were then distributed as cash incentives to the clinics based on their prescription performance. This restructuring appears to be a strategic move to mitigate the risks associated with direct rebate payments and regulatory penalties.

In a related case, the Fair Trade Commission also imposed sanctions on International Pharmaceutical for providing around 13 million won in rebates over several instances to a hospital in Gwangju from 2015 to 2019. This included funding for year-end celebration prizes and covering costs for group movie viewings for hospital staff, all of which were documented by the hospital's planning department. The commission's actions reflect an ongoing commitment to curbing illegal practices within the pharmaceutical industry, which can distort drug pricing and diminish the overall quality of healthcare. The impacts of these findings are significant, as they impact the trust in medical professionals and the ethical standards within the industry.