5 years ago5,000+ Views
Back in July 2013 rumours surfaced that the sales teams of the China division of GSK (GlaxoSmithKline) were targeting influential doctors with cash, extravagant presents and expenses-paid holidays masqueraded as conferences in order to win business. GSK responded immediately, firmly stating that it did not tolerate corruption in its business practices. External auditors and an investigator was hired to discern the truth behind what was presumed to be a perpetuated smear campaign against GSK by rival firms. GSK admitted "Some fraudulent behaviour relating to expense claims was identified, and this resulted in employee dismissals and further changes to our monitoring procedures in China". Since the case came to light, four senior GSK executives have been detained by Chinese police and the former head of GSK China, Mark Reilly, is also effectively detained. According to Chinese police, hired investigator Mr Humphrey will stand trial in secret later this year for illegally buying and selling private information (in no relation to the GSK case). In a statement dictated from prison, Mr Humphrey said that when he offered to look into the allegations, GSK told him they had already found them to be untrue. But when he finally saw the whistleblower's email, just weeks before his own arrest, he made it clear that he believed the allegations were credible. Bribery is widely believed to be endemic in China's pharmaceutical sector, which has witnessed explosive growth in recent years. While GSK has accepted that individual employees in China may have behaved inappropriately in China, it has consistently denied they acted on instructions of the company. If the company were found to be liable, it could face enormous fines from UK and US authorities who have fierce anti-bribery regulations. The crisis at GSK unfolds against a backdrop of a determined anti-corruption campaign spearheaded by China's leader Xi Jinping who, in the last few days alone, expelled a number of top officials from China's State Oil Company have been expelled from the Party on corruption charges. Oh China. It never rains but it pours.
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