Economy

GSK faces criminal investigation by fraud office amid bribing scandals

Published

10 years ago

May 28, 2014

Blue & Green Tomorrow

British pharmaceuticals giant GlaxoSmithKline (GSK) is being investigated by the Serious Fraud Office (SFO) over the bribery allegations it faces in China, Poland and Iraq.

The SFO has said it has opened a criminal investigation “into the commercial practices of GlaxoSmithKline plc and its subsidiaries” and that it encourages “approaches from anyone with inside information on all our cases, including this one”.

The company responded in a statement, saying, “GSK is committed to operating its business to the highest ethical standards and will continue to cooperate fully with the SFO”.

GSK is allegedly accused of having bribed doctors in China to make them prescribe its drugs and it faces similar accusations in Poland, Iraq, Jordan and Lebanon.

Chinese authorities said last July that GSK employees had “confessed” to charges of corruption dating back to 2007. It was said that they allegedly transferred £323m illegally to travel agencies and consultancies, to create a “massive bribery network”.

Mark Reilly, GSK’s former head of China operations, was replaced shortly after the scandal arose and has been accused recently by Chinese police of having bribed doctors and government officials in Beijing and Shanghai.

In Lodz, Poland, 11 doctors and a GSK regional manager have been charged with corruption dating back to 2010, in relation to the prescription of asthma drug Seretide.

GSK frequently appears in ethical and sustainable investment funds. Mike Appleby of Alliance Trust Investments previously said the firm would continue support to the company as long as it was committed to cleaning up its operations.

Recent new guidelines set by the Sentencing Council could make penalties faced by companies accused of bribery much tougher, because they would focus on the harm done to victims rather than on financial losses.

Photo: Ian Wilson via Flickr