China is coming down hard on GlaxoSmithKline's ($GSK) local operation. After a months-long bribery probe, Chinese police have slapped Glaxo's former country chief--Mark Reilly, a Brit--and two other top Chinese executives with several counts of bribery.
The charges are much harsher than industry officials and Chinese insiders had expected. Reilly is accused of actually masterminding an elaborate scheme to bribe doctors to prescribe GSK products. According to police, he ordered Glaxo employees to make secret payments to doctors, hospital staffers and government officials. And the potential penalties are equally harsh: The maximum sentence for a bribery charge in China is life in prison.
One of the big remaining questions is how Glaxo will be penalized. The Financial Times reports that GSK faces "corporate liability," citing an unnamed lawyer close to the company. And Glaxo's own comments aren't comforting, either; the company said it would like to "continue to make an important contribution" to Chinese public health. Which suggests that it might not be allowed to do so. Read more from FiercePharmaMarketing >>