April 4, 2014 / 11:47 AM / 6 years ago

GlaxoSmithKline sacks some China staff for malpractice: source

LONDON (Reuters) - GlaxoSmithKline, facing allegations of bribery in China, has dismissed some employees in the country over failure to comply with expenses rules, a person familiar with the situation said on Friday.

A Chinese employee walks into a GlaxoSmithKline (GSK) office in Beijing, July 19, 2013. REUTERS/Jason Lee

Britain’s biggest drugmaker declined to detail the move but confirmed it had stepped up monitoring of expenses claims, resulting in action being taken against some employees.

The closer staff surveillance in China follows accusations by Chinese authorities in July that GSK funneled up to 3 billion yuan ($483 million) in expenses to doctors and officials to encourage them to use its medicines.

“We routinely monitor and check expenses claims to ensure they adhere to our policies. Since the start of the investigation by the authorities, we have increased this monitoring in China,” a company spokesman said.

“Where we have found potential issues, we are thoroughly reviewing them and have withheld incentive payments where appropriate.”

The company declined to specify the number of staff involved in the crackdown but the source familiar with the matter said it was a very small proportion of the company’s total workforce in the country of around 7,000.

GSK has previously said some of its senior Chinese executives appeared to have broken the law. It has also said it has zero tolerance for bribery, calling the allegations in China “shameful”.

The corruption claims have taken a toll on GSK’s business in China which, through small, had been growing fast.

Before the scandal, GSK’s China sales had risen 14 percent year-on-year in the three months to end-June, but revenue in the country plunged 61 percent in the third quarter and 29 percent in the final quarter of 2013.

($1 = 6.2107 Chinese Yuan)

Reporting by Ben Hirschler; Editing by David Holmes

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