GlaxoSmithKline said Monday some of its executives in China appear to have broken the law in the giant bribery scandal still unfolding there.
Abbas Hussain, the head of emerging markets for the U.K.-based drug maker, said ‘Certain senior executives of GSK China, who know our systems well, appear to have acted outside of our processes and controls which breaches Chinese law.’
Last week, China detained four senior executives of GlaxoSmithKline. They’re suspected of orchestrating $489 million in bribes to doctors and medical officials. The detained officials are Chinese nationals.
The Ministry of Public Security said GSK used 700 travel agencies to pay the bribes since 2007.
China state TV last week broadcast a confession by GlaxoSmithKline’s vice president of China operations, Liang Hong. He admitted paying off doctors, saying the bribe amounts — up to thirty percent of the cost of the drugs — were passed along to consumers.
Hussain was sent to China Friday, along with a company auditor and lawyer. In a meeting with the Ministry of Public Security, he apologized for the company’s behavior.
He said GSK will reduce the price of medicines for Chinese patients following changes in the company’s business model.
Richard L. Cassin is the Publisher and Editor of the FCPA Blog. He can be contacted here.