China accuses GlaxoSmithKline of paying £300m in bribes

British drugmaker under investigation by Chinese authorities for alleged bribery and price fixing

The British drugmaker GlaxoSmithKline used travel agencies and consultancies as vehicles to bribe officials and doctors and illegally boosted the sales prices of its drugs sold in China, police said on Monday.

Since 2007 the company had transferred as much as 3bn yuan (£323m) to more than 700 travel agencies and companies, Gao Feng, a police official in charge of the investigation into the company, told a news conference.

The investigation had found GlaxoSmithKline was chiefly responsible for the bribes, including instances of sexual bribery, Gao said. Four senior Chinese executives have been detained.

Police said they had taken no action against any British nationals, adding that no information had been received from GSK's UK headquarters.

GSK, which says it was only told of the grounds of the investigation in early July, has said it found no evidence of bribery or corruption in China, adding it would co-operate with the authorities.

GlaxoSmithKline research centre in Shanghai. The company is under investigation over alleged briberyThe ministry of public security said on Thursday that GSK executives in China had confessed to bribery and tax violations during one of a string of investigations into foreign firms in the world's second-biggest economy.

The ministry said the case against Britain's biggest drug maker involved a large number of staff and a huge sum of money over an extended period of time, with bribes offered to Chinese government officials, medical associations, hospitals and doctors to boost sales and prices.

Article Source : http://www.guardian.co.uk

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China says GSK executives have confessed to bribing doctors

UK drugs maker GlaxoSmithKline under fire after executives in China confess to 'serious economic crimes' to boost revenue

Executives working for the UK drug maker GlaxoSmithKline in China have confessed to "serious" corruption and tax-related offences, China's security ministry said on Thursday, amid a wide-ranging series of investigations into foreign firms operating in the country.

The allegations, which the ministry classified as "serious economic crimes", include the bribing of doctors and officials in order to "open new sales channels and increase drug revenues". The employees are also claimed to have used fake receipts to violate tax regulations, according to a statement on the ministry's website. It did not reveal the employees' identities, how many were detained or when they were questioned.

"After initial questioning the suspects have admitted to the crimes, and the investigation is ongoing," the statement said, adding that police were carrying out investigations in Shanghai, Zhengzhou and Changsha, where GSK employees – whose identities have not been revealed – were detained two weeks ago on charges of fraud.

GlaxoSmithKline executives offered bribes to Chinese government officials, medical associations, hospitals and doctors to boost sales and pricesA spokesman for GSK rejected the charges, saying: "We take all allegations of bribery and corruption seriously. We continuously monitor our businesses to ensure they meet our strict compliance procedures. We have done this in China and found no evidence of bribery or corruption of doctors or government officials. However, if evidence of such activity is provided we will act swiftly on it."

He added: "We are willing to co-operate with the authorities in this inquiry. But this is the first official communication GSK has received from the PSB [public security bureau] in relation to the specific nature of its investigation."

A spokesman for the Foreign Office said: "We are aware of the Chinese investigation and we are in contact with GSK and the Chinese authorities."

The allegations follow similar claims that GSK sales staff in China showered doctors with money, dinners and all-expenses paid trips in promoting its Botox anti-wrinkle treatment.

The Botox allegations, reported in the Wall Street Journal following a tip-off from an anonymous source, centred on claims that GSK marketing staff in China had planned to pay doctors up to $490 (£325) for meeting prescription quotas between 2004-2010.

There is no evidence any payments were made and GSK's spokesman said the company had looked thoroughly at these allegations and had found nothing.

GSK's sales in China account for 3% of the group's turnover, but are expected to grow.

The allegations come as Beijing conducts a series of investigations into foreign companies across an array of industries. European and US-based companies Mead Johnson, Nestle and Danone have cut their infant milk formula prices in recent days amid a major government investigation into alleged price fixing. Earlier this year Chinese media targeted Apple and Volkswagon in scathing consumer rights investigations.

Article Source : http://www.guardian.co.uk

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