PARIS (Reuters) - The head and founder of France's Servier laboratories was placed under investigation on Wednesday in a probe of the drug Mediator, which officials say has caused at least 500 deaths in France, and has sparked a public furor over drug regulation.
Jacques Servier, the company's president, is being investigated in Paris on suspicion of dishonest practices, deception over the drug's quality, and of falsely obtaining authorisation to sell it, said his lawyer, Herve Temime.
Five companies under the umbrella of Servier are also under investigation.
Mediator -- an anti-diabetic drug that was mostly prescribed by doctors as a weight-loss pill -- was sold to as many as 5 million people between 1976 and November 2009, when it was withdrawn, years after being pulled in Spain and Italy.
State health inspectors have said the drug should have been withdrawn in France a decade earlier.
According to the French health ministry, at least 500 people died of heart valve trouble in France due to exposure to Mediator's active ingredient, benfluorex. Other estimates based on extrapolations put the death toll closer to 2,000.
Servier denies having misled authorities and patients. The company recognises 38 deaths linked to the drug, but says only four of these were caused by it.
Servier was ordered to post bail of 4 million euros and guarantee possession of a further 6 million euros before December 15. The companies must post 26 million euros ($36 million) with an additional guarantee of 39 million euros ($53 million).
The health scandal -- which has already prompted the resignation of the head of France's public health agency -- is France's worst in years.
President Nicolas Sarkozy has vowed to shake up the healthcare system and make it more transparent in response to a slew of lawsuits filed by groups of victims' families.
Questions remain as to why Mediator remained on a list of drugs that qualified for state rebates to users. One estimate found that France's social security services spent 428 million euros ($586 million) to reimburse people who bought the drug during its last 10 years on the market.
"It's now up to us to explain ourselves," Temime told journalists. "It goes without saying, but people who have been put on trial are innocent until proven guilty."
Servier, 89, was awarded France's national merit medal, the Legion d'Honneur, by Sarkozy -- who once served as his attorney -- less than a year before the drug was pulled.
Wednesday's hearing was the first time Servier had appeared before a judge in the case.
In separate proceedings involving 150 civil plaintiffs, a hearing is scheduled next week in Nanterre, near Paris.
(Reporting By Thierry Leveque and Gerard Bon; Writing by Alexandria Sage; Editing by Kevin Liffey)