CORRECTED-(OFFICIAL)-China police say GlaxoSmithKline broke law to boost sales prices

Sun Jul 14, 2013 11:25pm EDT

(Corrects to 3 bln yuan in second paragraph after police correct official translation)

BEIJING, July 15 (Reuters) - 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 3 billion yuan ($488.80 million) to over 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 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 had found no evidence of bribery or corruption in China, adding it would cooperate with the authorities.

The ministry 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 drugmaker 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. ($1 = 6.1375 Chinese yuan) (Reporting by Michael Martina; Writing by Kazunori Takada and Paul Carsten. Editing by Dean Yates)

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