Thu, Jul 25, 2013 - Page 15 News List

US citizen detained in pharma probe

Reuters and AFP, BEIJING

A US citizen has been detained in China in connection with probes sparked by an unfolding corruption scandal in the drugs industry, as China widens the range of international firms and staff under the spotlight.

Police have also questioned two more Chinese employees from British drugmaker AstraZeneca in Shanghai, after a local sales representative was taken away for questioning earlier.

The Chinese Ministry of Health also said 39 hospital staff would be punished for taking bribes from two drug companies. The firms involved were not identified.

The unnamed American is the first US citizen to be detained in connection with the investigations, and the second foreign national, after a British risk consultant linked with GlaxoSmithKline (GSK) was held last week.

GSK, Britain’s biggest drugmaker, has been accused by China of funneling up to 3 billion yuan (US$489 million) to travel agencies to facilitate bribes to doctors and officials.

“We are aware that a US citizen has been detained in Shanghai. We are in contact with the individual and are providing all appropriate consular assistance,” US embassy spokesman Nolan Barkhouse said on Tuesday, when asked about the involvement of US citizens in the widening probe.

He declined to say which company the individual was associated with.

The latest moves by Chinese officials underline the country’s tough stance on corruption and high prices in the pharmaceutical industry, as it unrolls wider healthcare access and faces an estimated US$1 trillion healthcare bill by 2020.

“Momentum is gathering and if you are a big international firm, then you’re a good example to be held up. This is a wake-up call for the rest of the industry,” said Jeremy Gordon, director of China Business Services, a risk management company focusing on China.

GSK expects its financial performance in China to take a hit from Bejing’s probe into bribery allegedly carried out by senior staff, the British pharmaceuticals company said yesterday.

“Clearly, we are likely to see some impact to our performance in China as a result of the current investigation, but it is too early to quantify the extent of this,” GSK chief executive Andrew Witty said in an earnings update.

The company has called the bribery accusations “shameful” and on Monday said some of its Chinese executives appeared to have broken the law.

AstraZeneca said the Shanghai Public Security Bureau had asked on Tuesday to speak with two line managers linked to the sales representative questioned earlier.

“The Public Security Bureau is describing this as an individual case. We have no reason to believe it is related to other investigations,” the company said in a statement.

Meanwhile, Chinese doctors and officials who are taking bribes are feeling the wrath of the authorities.

Xinhua news agency, citing a statement from the Chinese Ministry of Health on Tuesday, said 39 employees at a hospital in Guangdong Province would be punished for taking illegal kickbacks, totaling 2.82 million yuan, from two drugmakers between January 2010 and December last year.

“The vice chairman of the hospital’s trade union and two people in charge of the two pharmaceutical companies involved have had their cases transferred to judicial organs, while nine doctors who directly received kickbacks were dismissed, suspended or had their licenses revoked,” the report said.

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