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GlaxoSmithKline Under Investigation by Chinese Authorities GlaxoSmithKline Is Investigated in China
(about 7 hours later)
SHANGHAI — The British pharmaceutical giant GlaxoSmithKline said on Monday that the authorities here were investigating whether senior managers working for the company in China were involved in “economic crimes.”SHANGHAI — The British pharmaceutical giant GlaxoSmithKline said on Monday that the authorities here were investigating whether senior managers working for the company in China were involved in “economic crimes.”
A spokesman in London said GlaxoSmithKline was unaware of the nature of the police investigation in China but that the company’s executives were cooperating. A spokesman in London said that GlaxoSmithKline was unaware of the nature of the investigation but that the company’s executives were cooperating.
The announcement came weeks after the company fired the head of its research and development staff in Shanghai for misrepresenting data in a scientific paper he co-authored. Two weeks ago, the company fired the head of its research and development staff in Shanghai for misrepresenting data in a scientific paper he helped to write.
And two weeks ago, The Wall Street Journal reported that a whistle-blower had sent information to GlaxoSmithKline’s board of directors claiming that for years the sales staff in China had engaged in the “widespread bribery of doctors to prescribe drugs.” Also two weeks ago, The Wall Street Journal reported that a whistle-blower had sent information to GlaxoSmithKline’s board claiming that for years the sales staff in China had engaged in the “widespread bribery of doctors to prescribe drugs.”
The company said on Monday that it had thoroughly investigated the accusations made by the whistle-blower and concluded earlier this year that there was no evidence of bribery or corruption in its Chinese operations. The company said on Monday that it had thoroughly investigated the accusations made by the whistle-blower and concluded this year that there was no evidence of bribery or corruption.
GlaxoSmithKline has said in regulatory filings that the United States Justice Department and the Securities and Exchange Commission contacted the company as early as 2010 about possible violations of the Foreign Corrupt Practices Act in its overseas operations, including China. The company referred to the contacts as “discussions,” rather than an investigation, and said on Monday that they were continuing. Glaxo has said in regulatory filings that Justice Department and the Securities and Exchange Commission contacted it as early as 2010 about possible violations of the Foreign Corrupt Practices Act in its overseas operations, including China. The company referred to the contacts as “discussions,” rather than an investigation, and said on Monday that they were continuing.
The troubles at the company, which is also known as GSK, come at a time when a growing number of multinational corporations are coping with bribery and corruption accusations in China, where offering cash bribes and kickbacks is widespread. The troubles at the company, also known as GSK, are the latest example of a growing number of multinational corporations coping with bribery and corruption accusations in China, where offering cash bribes and kickbacks is widespread. Several American companies have been prosecuted in recent years in the United States under the Foreign Corrupt Practices Act, which forbids bribing foreign government officials.
The Chinese police made their announcement over the weekend. The public security bureau in the city of Changsha, in central China’s Hunan Province, posted a brief statement online announcing an investigation into senior managers at GSK China for economic crimes. The Chinese police made their announcement over the weekend. The public security bureau in the city of Changsha, in central China’s Hunan province, posted a brief statement online announcing an investigation into senior managers at GSK China for economic crimes.
“It is still unclear what is the precise nature of their investigation,” Simon Steel, a company spokesman, said on Monday, adding, “We will cooperate.” “It is still unclear what is the precise nature of their investigation,” Simon Steel, a company spokesman, said on Monday. “We will cooperate.”
Over the weekend, the Chinese police also reportedly detained GlaxoSmithKline managers in Shanghai, Beijing and Changsha, according to Monday’s edition of The South China Morning Post, which is published in Hong Kong. Over the weekend, the Chinese police also detained GlaxoSmithKline managers in Shanghai, Beijing and Changsha, according to Monday’s edition of The South China Morning Post, which is published in Hong Kong.
GlaxoSmithKline is one of the world’s biggest drug companies, and it has both manufacturing and research and development facilities in China, with about 5,000 employees. Glaxo is one of the world’s biggest drug companies. It has both manufacturing and research and development facilities in China, with about 5,000 employees.
Although China still accounts for a small share of its global revenue, the country is one of the fastest-growing markets for the company. In 2012, the company’s revenue in China rose 17 percent, to nearly $1.2 billion, from 2011, according to the company’s annual report. Although China accounts for a small share of the company’s global revenue, it is one of the fastest-growing markets. In 2012, the company’s revenue in China rose 17 percent, to nearly $1.2 billion, from 2011, according to the company’s annual report.