The Chinese government announced Wednesday it had concluded its corruption investigation into British pharmaceutical giant GlaxoSmithKline plc and would be charging three former executives, including the company’s head of China operations and its legal director.
According to the official Xinhua news agency, the 10-month probe was conducted by officers of the Public Security Bureau based in Changsha, a city in Hunan province in central China. The three executives were detained last year as the government investigated charges that they led a bribery campaign targeting doctors, hospitals and officials to prescribe or purchase GSK products.
Employees were encouraged by China executives to bribe their way to higher sales targets, an unnamed police official told Xinhua.
The charged executives are former GSK China head Mark Reilly, a British national; legal director Zhao Hongyan; and Zhang Guowei, a vice president of human resources.
Last July, The Asian Lawyer reported the GSK scandal and detention of Zhao had raised questions about how in-house legal departments operate in China. In an interview, Sheppard Mullin Richter & Hampton Beijing managing partner James Zimmerman said Chinese in-house lawyers faced to pressure “to step in line with the illicit activities of wayward on-the-ground managers that are under much pressure to capture the markets.”
The prosecution will take place in Changsha. A Shanghai-based GSK spokeswoman says the company is cooperating with authorities and is “deeply concerned” about the allegations, since they run counter to its values.