News from China
On May 14, 2014, Xinhua News Agency reported that Chinese police have concluded a 10-month investigation against GlaxoSmithKline (GSK) and uncovered evidence of “large-scale” bribery in Chinese hospitals and other medical institutions, with illegal income amounting to “billions of Chinese yuan.”
Investigators have delivered their findings to Chinese prosecutors, who have begun reviewing the case, the news agency reported, citing unnamed sources with the Hunan police authority. It is also reported that Changsha People’s Procurator has indicted a total of 35 defendants in the GlaxoSmithKline (GSK) commercial bribery case, including GSK’s China unit. The 35 defendants include corporate entities such as GSK’s China unit, pharmaceutical distributors and a Chinese travel agency. They also include individuals such as Mark Reilly, the former head of GSK China, other former GSK China managers, employees of the implicated travel agency and pharmaceutical distributors.
According to the Xinhua report, the police have focused on three allegations: the crime of bribing of non-government working personnel, the crime of a unit making bribes and the crime of making bribes to a unit. It is disclosed that GSK’s China management had even bribed officials at AICs in Beijing and Shanghai in an attempt to quash their anti-corruption investigations.
News from UK
GlaxoSmithKline PLC is now the subject of an investigation by the United Kingdom's Serious Fraud Office, the company announced in a statement on May 27, 2014.
The British pharmaceutical giant provided no specific details on the nature of the investigation, but reassured investors and the public that it was doing everything in its power to assist authorities in gathering information.
“GSK is committed to operating its business to the highest ethical standards and will continue to cooperate fully with the SFO,” the statement said.
According to its website, the U.K. Serious Fraud Office investigates and prosecutes “those who commit serious or complex fraud, bribery and corruption and pursuing them and others for the proceeds of their crime.”
It is clear that GSK will have to fight at two frontiers simultaneously.
