Glaxo severs ties with 700 travel agencies in scandal
Responding to the allegations that it used travel agents in China to pass bribes to elected officials, GlaxoSmithKine yesterday said it has severed its ties to the agencies involved and is "conducting a thorough review of all historic transactions related to travel agency use" and of its compliance procedures in China.
The British drug company on Monday was accused of transferring as much as 3 billion yuan ($489 million) to 700 travel agencies and consultancies, who then passed the money to Chinese officials and doctors as bribes.
The People’s Daily newspaper said the travel agencies billed GSK for phony "conference services" and then used some of the money on bribes to push up sales of GSK drugs.
In a printed release, GSK said it is "deeply concerned and disappointed by these serious allegations of fraudulent behaviour and ethical misconduct by certain individuals at the company and third-party agencies. Such behaviour would be a clear breach of GSK’s systems, governance procedures, values and standards. GSK has zero tolerance for any behaviour of this nature."
GSK said it "shares the desire of the Chinese authorities to root out corruption. These allegations are shameful and we regret this has occurred."
The company vowed to cooperate fully with the Chinese authorities in the investigation and take all action required by its outcome.
"GSK fully respects the laws and regulations in China and expects all staff to abide by them" and fully supports "the efforts of the Chinese authorities in their reforms of the medical sector and stands ready to work with them to make the necessary changes for the benefit of patients in China," the statement concluded.
By Cheryl Rosen
Cheryl
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