GSK says China execs may have broken Chinese law

Business & Finance China Featured - July 23rd, 2013

GlaxoSmithKline, under a probe in China for alleged bribery, has admitted wrongdoing by some of its senior executives.

Abbas Hussain, GSK’s president of international operations, said that senior China-based executives “appear to have acted outside of our processes and controls, which breaches Chinese law.”

Hussain apologized to Chinese authorities and said the drug company was taking the charges “extremely seriously”.

“We have zero tolerance for any behaviour of this nature,” Hussain said.

In a nod to the Chinese government’s concerns about soaring healthcare costs, Hussain pledged that GSK would reduce drug prices in China, according to the Financial Times.

Hussain also said GSK supports China’s action against corruption and will fully cooperate with authorities in a continuing investigation.

GSK came under scrutiny over allegations it has bribed doctors to prescribe the firm’s drugs, as part of a wide-ranging probe involving Western drug companies in the country.

Several GSK employees have been detained in connection with the probe while the firm’s British head of finance in China, Steve Nechelput, had been banned from leaving the country.

China’s Ministry of Public Security said in a statement Monday that GSK’s executives in China pushed up prices to increase sales, “seriously disrupting the market” and “violating vital interests” of the majority of patients in the country, reports the Wall Street Journal.