CHINA TOPIX

12/03/2021 05:53:34 pm

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GlaxoSmithKline Under Investigation for Unethical Commercial Practices

(Photo : Reuters / Aly Song) GlaxoSmithKline office in Shanghai, China.

The Serious Fraud Office is investigating the British pharmaceutical company, GlaxoSmithKline (GSK), according to the New York Times.

GSK announced Tuesday that Britain's fraud office has launched a formal investigation into their "commercial practices."

The company is fully cooperating with local authorities and adds that it doesn't condone unethical practices such as bribery and corruption.

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Questions on the company's business practices come into the spotlight as a number of investigations lead authorities to believe that doctors are being paid to promote their products in China, Iraq and Poland.

In GSK's China branch, local authorities charged GSK China head of operations, Mark Reilly and 2 other executives, for condoning the bribery of health care professionals to use and promote the company's drugs. Authorities estimate revenues from this unethical practice to at least $150 million.

Probing into the case, authorities learned that GSK China was paying doctors travel subsidies for conferences and lectures that didn't exist.

Following the indictment charges, Reilly resigned. Apparently, GSK had no knowledge of this.

"We have zero tolerance for any behavior of this nature," the company added in its statement following a meeting with Chinese authorities last year.

Similarly, GSK Iraq has been under scrutiny for bribing public hospital doctors to promote their drugs.

In 2010 and 2012, 11 doctors and a GSK employee in Poland were charged with bribery and corruption.

According to the pharmaceutical manufacturer, it learned that GSK was paying doctors to teach and deliver training as part of a training program on treatment of respiratory disease. The program had run for 3 years until GSK discovered this violation.

To prevent bribery acts of GSK branch companies and employees, the drug manufacturer altered their compensation system for the sales department last December.

The company explained that sales bonuses, which were previously based on the employees' achievement of sales quota, will now be based on the employees' 'technical knowledge, quality of service and adherence to the company values of transparency, integrity, respect and patient-focus.'

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