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46 suspects allegedly bribed doctors, government officials

By Cathy Wong Source:Global Times Published: 2014-5-15 1:03:01

Briton accused of GSK corruption


The bribery investigation into GlaxoSmithKline (GSK) China is completed and the case has been handed over to prosecutors, police in Changsha, Hunan Province, said Wednesday.

Mark Reilly, a British national and former manager of GSK China, is accused of pressing his sales teams to bribe hospitals, doctors and other medical institutions in exchange for sales deals and billions worth of illegal revenue, the Xinhua News Agency reported.

A total of 46 suspects are involved in the case. Two executives, Zhang Guowei and Zhao Hongyan, are also suspected of bribing Beijing and Shanghai government officials to escape the probe, Xinhua reported.

Reilly allegedly raised GSK China's revenue through bribery from 3.9 billion yuan ($0.63 billion) in 2009 to 6.9 billion yuan in 2012 since he became the head of prescription drugs at GSK China in January 2009.

He was then promoted to general manager of GSK China in November 2012.

The cost for bribery and sales team expansion was transferred to Chinese customers, as some GSK products are seven times more expensive than the same products sold in other countries, Xinhua reported.

All the related transactions were settled through their overseas bank accounts, investigators said.

A GSK China spokesperson told the Global Times in an e-mail Wednesday that the firm has met with the Ministry of Public Security to discuss the case. They pledged to cooperate fully with authorities and prosecutors are now reviewing the case.

Changsha police, who have headed up the investigation, declined to comment when reached by the Global Times.

The whereabouts of Reilly is currently unknown, and it is not known if he is under detention. He had left China but returned last year to help the investigation. He was banned from leaving China, The Telegraph reported in October 2013.

A spokesman for the British Consulate in Shanghai said officials were in regular contact with Reilly and were providing consular assistance, but refused to comment on Reilly's whereabouts, Reuters reported  Wednesday.

One of the suspects, a doctor at a hospital in Hunan, told Xinhua that a GSK sales representative approached him in March 2012 and offered him 20 yuan for every box of Heptodin he prescribed and 100 yuan for every new patient who started taking the drug.

The doctor, surnamed Li, prescribed 150 to 200 boxes of Heptodin and recruited extra patients. The deal brought him about 4,800 yuan of extra monthly income. Heptodin is a hepatitis B antidote.

Zhang, a key suspect and the then vice president and human resources director of GSK China, told Xinhua the global headquarters imposed high sales growth targets in China so as to compensate for the recession in US and European markets.

"This is not a singular case, but one of the examples showing China's increasing effort in fighting corruption," said Zhu Guohua, a law professor at Tongji University. 

Multinational corporations from the US, Japan and Germany have been involved in graft scandals in recent years, and more will be revealed, Zhu said, adding the government will tighten the law on corruption in the commercial sector.   

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