SHANGHAI, Sept 3 A Chinese police investigation
into drugmaker GlaxoSmithKline has discovered that
alleged bribery of doctors in China was coordinated by the
British company and was not the work of individual employees,
state media reported on Tuesday.
Police in July detained four senior Chinese executives at
GSK over allegations the company funnelled up to 3 billion yuan
($490 million) to travel agencies to facilitate bribes to
doctors and officials to boost the sale of its medicines.
"It is becoming clear that it is organised by GSK China
rather than ... sales people's individual behaviour," the
official Xinhua news agency reported.
GSK said the issues identified in the Xinhua report would be
a "clear breach of our corporate values" and it shared the
desire of the Chinese authorities to root out corruption.
"We remain deeply concerned by the allegations of fraudulent
behaviour and ethical misconduct in our China business," a
company spokesman said.
The company has said previously that some of its senior
Chinese executives appear to have broken the law, and that it
has zero tolerance for bribery.
The GSK investigation is one of several into China's
pharmaceutical sector. Others have focused on how drugmakers
price their medicines in the world's second-largest economy.
Xinhua quoted Huang Hong, general manager for GSK's business
operations in China and one of the detained executives, as
saying the company had set goals for annual sales growth as high
as 25 percent. That rate was 7 to 8 percentage points above the
average growth rate for the industry, Huang said.
GSK implemented salary policies based on sales volumes and
such goals could not be achieved without "dubious corporate
behaviour", Huang said.
Official media routinely get access to detainees in China.
Other detained GSK executives have been interviewed on state TV.
China accounts for just 3.5 percent of GSK's global drug
sales but demand is growing fast - up 17 percent last year - and
the company is investing heavily, with more than 7,000 staff in
China, as well as five factories and a research centre.
Guo Jianhua, head of recruitment at GSK China, was quoted by
the official People's Daily newspaper as saying the company had
turned a blind eye to illegal behaviour.
"When the problems were exposed, the company pushed all
responsibilities to individual employees," Guo said.
It was unclear which problems Guo was referring to or if he
was one of the detained executives.
Corruption in China's pharmaceutical industry is widespread,
fuelled in part by low base salaries for doctors at the
country's 13,500 public hospitals.
Industry executives say ties to doctors at hospitals are key
to sales, with pharmaceutical companies as well as medical
device makers often sponsoring research conferences to win their
The People's Daily quoted Huang as saying GSK had set up a
special team dedicated to maintaining relationships with key
hospital officials, with an annual budget of nearly 10 million
Since the GSK scandal broke, whistleblowers from other
foreign drugmakers have come forward to make accusations of
bribery against their companies in China.