Britain’s fraud office has launched a formal criminal investigation into GlaxoSmithKline (GSK) PLC, posing a new challenge to the drugmaker, which faces claims of bribery in China and four other countries.
Britain’s Serious Fraud Office (SFO) on Tuesday said its director had “opened a criminal investigation into the commercial practices of GlaxoSmithKline and its subsidiaries,” confirming an earlier brief statement from the company.
“GSK is committed to operating its business to the highest ethical standards and will continue to cooperate fully with the SFO,” Britain’s biggest drugmaker said.
Neither the office nor GSK gave any further details about the case.
The office’s probe comes less than two weeks after Chinese police on May 14 said they have charged the former British boss of GSK’s China business and some of his colleagues with corruption.
The charges were the result of an investigation by Chinese authorities that found evidence of an elaborate scheme to bribe doctors and hospitals in the country.
The case is the biggest corruption scandal to hit a foreign company in China since the Rio Tinto Group affair in 2009, which resulted in four executives being jailed.
The decision by the office did not come as a complete surprise, with lawyers and industry analysts already having said that allegations against GSK in overseas markets could expose it to charges under the UK Bribery Act.
Like the US Foreign Corrupt Practices Act, the new UK act prohibits paying government officials, including state-employed doctors, to obtain business overseas.
US authorities are already probed GSK for possible violations of anti-bribery US laws in China, sources said in September last year.
In a bid to try and put the problems behind it, GSK is rolling out a new sales model designed to eliminate sharp marketing practices.
The firm aims to become the first in the industry to stop paying outside doctors to promote its products, end payments for medics to attend conferences and unlink incentives for sales representatives from individual sales targets.
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