Only Glaxo Chinese Execs May Face Charges in Bribery Scandal

Two months after reports suggested the GlaxoSmithKline bribery scandal in China may have been coordinated at a high corporate level, a new report suggests that Chinese executives working for the drugmaker are likely to be charged with corruption, but not the corporation. If this plays out, as Reuters writes, this would be a relatively positive outcome for Glaxo. Any move by Chinese authorities to charge the drugmaker could result in major fines and disrupt operations in China, where sales recently fell 61 percent as Glaxo products were shunned in the wake of the scandal. What remains unclear is whether the episode will prompt US authorities to decide if Glaxo violated the Foreign Corrupt Practices Act or a so-called Corporate Integrity Agreement. “There will likely be big fines, but it’s unlikely GSK will be thrown out of the country,” a source tells Reuters. And a lawyer based in China with knowledge of the investigation, tells the news service that “for senior management to be charged you have to prove that this person has awareness or knowledge of the criminal act, or at least should have known but did not exercise his duty of care. I'm not sure the government has the evidence supporting these allegations.” The development comes two months after the Xinhua news agency reported that Huang Hong, who was general manager for Glaxo operations there, claimed the drugmaker shifted responsibility onto individual sales reps as the investigation heated up. The police inves...
Source: Pharmalot - Category: Pharma Commentators Authors: Source Type: blogs