Further
details have emerged of the bribery investigation into GlaxoSmithKline China
after the company's four senior executives were taken into custody, with the
Chinese-language Beijing Times reporting that executives have admitted bribing
hundreds of hospitals across the country in return for drug orders.
Police in
Changsha, Hunan province confirmed that these senior executives also took
bribes from Comfort Group M.I.C.E. Service, Shanghai, and its sales agents.
In order to
expand its sales channels and boost its prices, GSK China mostly bribed
government officials, some medical associations and foundations, hospitals and
doctors by offering cash or sexual favors.
A sales
representative at GSK China told the paper that the company trained its
employees to bribe doctors and offered nearly 10% of the money from sales to
the doctors as kickbacks.
Changsha
police have detained more than 40 persons connected with the case.
Huang Hong,
45, is one of the senior executives at GSK China to be detained. She said that
when Mark Reilly took over as head of GSK China in 2009, he had taught Huang
that generating sales was the company's primary objective.
Reilly also
reportedly said that it was crucial to enter the hospital sector to boost sales
and maintain good connections with the deputy heads and directors of hospitals'
pharmaceutical departments as they would extend more support when it came to
evaluating GSK's products.
After
Reilly joined the China branch, GSK's sales jumped from 2.3 billion yuan
(US$375.5 million) a year to more than 7.2 billion yuan (US$1.18 billion)
through the addition of more hospital clients.
Huang
stated that the PR fees for major clients had touched nearly 10 million yuan
(US$1.6 million) per year.
In
addition, the police investigation revealed that several senior executives at
GSK China also took bribes, including Huang, Liang Hong, Gao Qiwei, procurement
director Qiu Bilin and recruitment director Guo Jianhua.
The Comfort
Group Service in Shanghai paid bribes worth 3.8 million yuan (US$620,000) to
these four GSK executives. The group also gifted Qiu a luxury bag in 2009 and
gave each of the four cash sums of 200,000 yuan (US$32,000) in 2010, 360,000
yuan (US$59,000) in 2011 and 500,000 yuan (US$82,000) in 2012 and 2013.
The group
obtained 40 million yuan (US$6.5 million) worth of business from GSK China each
year.
No comments:
Post a Comment