Chinese police charge former GSK China head with bribery

Tags: GSK, News
Chinese police on Wednesday said they had charged the British former China head of drugmaker GlaxoSmithKline PLC and other colleagues with corruption, after a 10-month probe found they paid billions of yuan in bribes to doctors and hospitals.

Mark Reilly and two Chinese executives, Zhang Guowei and Zhao Hongyan, were also suspected of bribing officials in the industry and commerce departments of Beijing and Shanghai, the official Xinhua news agency reported, quoting police in Hunan province.

It is the biggest corruption scandal to hit a foreign company in China since the Rio Tinto affair in 2009, which resulted in four executives including an Australian being jailed for between seven and 14 years each.

"(GSK) departments offered bribes to hospitals and doctors as well as personnel to boost their sales. The money involved was in the billions of yuan (hundreds of millions of dollars)," a Ministry of Public Security official told a press conference in Beijing.

A China-based GSK spokesman was not immediately available for comment.

The allegations have damaged GSK's reputation, thrown its China management team into turmoil and forced it to change its China business model, although the firm says head office had no knowledge of alleged wrongdoing.

China is a key growth market for large drugmakers, which are counting on the country's swelling middle class to offset declining sales in Western countries.

But bribery between sales staff and doctors is rife in the world's second-biggest economy, and it remains to be seen whether the GSK case will be a one-off or the first of a broader campaign to clean up the Chinese health sector.

Before the scandal, GSK's China sales had risen 14 percent year-on-year in the three months to end-June, but revenue in the country plunged 61 percent in the third quarter and 29 percent in the final quarter of 2013.

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


  • Modi must clearly say that preservation of cows is not about manslaughter

    Instead of in-fighting between hindus and muslims, India should fight poverty and maintain its values of diversity and tolerance, as advised by Presid


Stay informed on our latest news!


Sarthak Raychaudhuri

vice-president, HR, Asia South Whirlpool of India

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs


Urs Schoettli

America lacks will to contain China

Recently both the Chinese leader Xi Jinping and Indian prime ...

Zehra Naqvi

Exercise gets creative juices flowing

Ever known that feeling of being sluggish and drowsy, of ...

Bubbles Sabharwal

You are what you believe yourself to be

The Gita says a man is what his shraddha is. ...


William D. Green

Chairman & CEO, Accenture