Reuters - Video

Edition: U.S. | U.K. | IN | CN

Finance Videos

Will GSK's payment ban set a precedent?

Tuesday, December 17, 2013 - 01:40

Dec.17 - GlaxoSmithKline will stop paying doctors to promote its products at events and remove individual sales targets for its marketing staff in a first for the drugs industry looking to recover from scandals over improper sales practices. Hayley Platt reports on the implications for the industry.

▲ Hide Transcript

View Transcript

Its sales practices have left it fighting bribery charges in China. And now GlaxoSmithKline wants to move on. The UK drugs company will stop paying doctors to promote its products at events. And it'll also remove individual sales targets for its marketing staff. That's a step further than AstraZeneca which two years ago stopped paying healthcare professionals to attend medical conferences. IG's Alistair McCaig says GSK could suffer financially as a result. (SOUNDBITE): Alistair McCaig, Market Analyst, IG, saying (English): "It's laudable the actions that they're taking but you've got to fear that there's going to be some fiscal pain they're going to have to wear for a while until others follow suit." The initiative is designed to silence critics by removing potential conflicts of interest in order to ensure the best outcome for patients. SOUNDBITE: Alistair McCaig, Market Analyst, IG, saying (English): "It's a self-regulated area of the business and the drug makers maybe need to make some moves here before moves are put upon them. They've maybe taken a little glance at what's happened to the banking sector and decided enough enough here and maybe we need to do something." GSK says the measures aren't directly related to China's accusations that it paid up to $500 million to travel agencies to facilitate bribes to boost sales. It says they're part of a broader effort to improve transparency. Either way they are expected to prompt others to look carefully at their strategies. The entire drugs industry has been under fire for aggressive marketing tactics in recent years. And there've been numerous conflicts in the US - the industry's biggest market. GSK also had issues there - it paid a record $3billion to settle charges it provided misleading information on certain drugs

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

Will GSK's payment ban set a precedent?

Tuesday, December 17, 2013 - 01:40