China probes British drugmaker GSK - report

SHANGHAI, July 4 Thu Jul 4, 2013 1:34am EDT

SHANGHAI, July 4 (Reuters) - China's top economic planning agency has opened an investigation into pharmaceutical giant GlaxoSmithKline Plc's operations in China, an official newspaper reported on Thursday, as foreign firms come under pressure from Beijing for possible price-fixing.

The National Development and Reform Commission (NDRC) has begun a survey on production costs at 60 firms, including Britain's GlaxoSmithKline and 10 China-listed firms, the official Securities Daily said.

The investigation could focus on the difference in prices of imported products sold by foreign firms, such as GlaxoSmithKline, in China compared with those in other markets, the paper said citing unidentified sources.

The NDRC did not reply to a request from Reuters for more details.

Officials at GlaxoSmithKline could not be immediately reached for comment.

The NDRC is also investigating into possible price-fixing and anti-competitive behaviour by five instant milk powder makers, including Swiss food company Nestle and French rival Danone.

In response, Nestle and Danone said on Wednesday they were cutting the price of infant formula milk in China.

The NDRC probe into GlaxoSmithKline comes as high-level Chinese staff at the firm are being investigated by police in the south-central Chinese city of Changsha on suspicion of economic crimes.

Changsha police have not provided any further details about the investigation.

A GSK spokeswoman in London said investigations by Chinese authorities into the firm's operations in China were ongoing, but added it was unclear what the investigations were about.