|Britain’s GSK sales teams had 10m yuan ‘PR funds’ to grease palms at hospitals, investigators say
British drug maker GlaxoSmithKline China and not individual sales people are responsible for well-orchestrated moves to bribe officials and commit tax-related violations, investigators in China suspect.
GlaxoSmithKline China has been under investigation since early July for suspected bribery and tax-related violations, which have pushed up drug prices, Xinhua reports.
More individuals have admitted some facts of suspected transgressions. As the investigation continues, it is becoming clear that it is organized by GSK China rather than drug sales people.
Every team handling big customers has almost 10 million yuan of “public relations funds’’to keep close ties with key staff in major hospitals.
Huang Hong, a high-ranking executive of GSK China, said the parent company had assigned annual growth goals of up to 25 percent in recent years, 7 to 8 percentage points more than the industry average.
GSK China linked salaries to sales volume. If a salesperson is unable to achieve goals, they could lose several thousand yuan every month.
The company's code of conduct states that every employee should abide by the country's laws and prohibits any cash transfers to doctors or government officials. Sales people appear to have achieved targets by breaking those rules.
When investigated, the company passed the buck to sales force, but the police investigation has found that GSK China went through the motions in internal auditing so as not to uncover these violations.
Huang admitted that the growth rate of sales could not reach such a high number only by the efforts of the sales people themselves if there was no dubious corporate behavior.
The police have also revealed details of suspected bribe taking by some GSK China executives.