NewsChina
CORRUPTION

Former GSK China head Mark Reilly remains in China to help graft probe

PUBLISHED : Thursday, 17 October, 2013, 12:00am
UPDATED : Friday, 18 October, 2013, 5:03am
 

Mark Reilly, GlaxoSmithKline's former head of operations in China, is helping anti-corruption officials in the country investigating allegations of bribery by the drug maker.

One person familiar with the situation said Reilly had been asked to remain in China while the investigations proceeded and was happy to do so.

Both GSK and the British embassy in Beijing said yesterday Reilly had not been detained.

An embassy spokesman said it was in regular contact with him and was providing consular assistance.

Reilly was replaced as GSK's China head on July 25 after police accused the drug maker of funnelling up to 3 billion yuan (HK$3.8 billion) to travel agencies to facilitate bribes to doctors and officials.

GSK said at the time that Reilly would continue to help lead its response to the investigation.

"Mark is working closely with the Chinese authorities to conduct a thorough investigation and voluntarily returned to China to help them," a GSK spokesman said.

"Several weeks ago he met with the Chinese authorities in Changsha to provide them with information and assistance. At no point was he detained. Mark remains in China to help further with the probe should it be required."

A number of Chinese employees of GSK have been detained, including four senior members of the local management team. But the authorities have not detained any foreign nationals working for the drug maker.

The police allegations against GSK, laid out in detail on July 15, sent shockwaves through the industry and cast doubt over GSK's ability to ensure compliance standards in fast-growing markets like China.

The crackdown reflects a growing determination by Chinese authorities to stamp out corporate bribery and corruption, which can drive up prices for consumers.

GSK has admitted that some of its Chinese executives appeared to have broken the law and has said it planned to change its business model to lower the cost of medicines in the country.

Several other international drug makers - including Sanofi, Novartis, AstraZeneca, Eli Lilly and Bayer - have also been visited by Chinese officials and the episode has undoubtedly hit sales in the mainland pharmaceutical market.

Analysts at Deutsche Bank said this week that the anti-bribery campaign was likely to last for some time, affecting both multinational and domestic drug companies.

GSK will report third-quarter results on October 23, when the scale of the impact of the affair on its business in China is expected to be revealed.

Share

Send to a friend

To forward this article using your default email client (e.g. Outlook), click here.

Enter multiple addresses separated by commas(,)

For unlimited access to:

SCMP.com SCMP Tablet Edition SCMP Mobile Edition 10-year news archive