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Corruption allegations: GlaxoSmithKline pays kickbacks to doctors and government officials

The former head of the Chinese division of GlaxoSmithKline has been charged with corruption in connection with the unraveling bribery scandal in which GSK paid off doctors and government officials.1 In the past six years Mark Reilly and some of his associates allegedly spent an approximate sum of $480million on hospitals and its employees, in order to increase the sales of GSK pharmaceuticals.2 According to the online news agency American Free Press there have been 46 suspects whose interrogation by the Chinese authorities has already taken place due to their supposed engagement in bribery.3 Shortly after the allegations against the pharmaceutical company were made public their sales in the Chinese market fell 61%.4 The Chinese authorities are not only investigating GlaxoSmithKline; big international pharmaceutical companies like Novartis International AG, AstraZeneca PLC, Sanofi S.A., Bayer AG und Eli Lilly and Company have also been subjected to greater scrutiny.3 Furthermore, a Chinese state-owned news agency has accused GSK to be evading taxes of a lump sum of around $16million in import duties by importing its HIV drug Lamivudine, which is also used to treat hepatitis, at an elevated price.5 Furthermore, GSK used tax loopholes for charitable donations to their advantage in order to decrease their tax liability.5 More corruption allegations have just recently come to the fore in Poland, where doctors were also bribed in order to boost their sales and in Iraq.6

  1. Reuters: Chinese police charge British former head of GSK in China with bribery. Available at: Last accessed on: 18.08.2014 []
  2. Reuters: UK fraud office liaising with China on GSK bribery case. Available at: Last accessed on 18.08.2014 []
  3. American Free Press: Big Pharma Bribery Scandal. Available at: Last accessed on 18.08.2014 [] []
  4. Bloomberg: Glaxo’s China Sales Plunge 61% After Corruption Probe. Available at: Last accessed on 18.08.2014 []
  5. International Business Times: GlaxoSmithKline China accused of tax evasion via AIDS treatment. Available at: Last accessed on 18.08.2014 [] []
  6. Guardian: GlaxoSmithKline faces bribery allegations in Poland. Available at: Last accessed on: 18.08.2014 []