GlaxoSmithKline plc (NYSE:GSK) (LON:GSK), the largest pharmaceutical company in the United Kindom said that some of its executives in China may have broken regulations in the country in connection with the allegations of bribery and corruption against its Chinese operations.
In a statement today, Abbas Hussais, president international- Europe, Japan, Emerging Markets & Asia Pacific at GlaxoSmithKline plc (NYSE:GSK) (LON:GSK) 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. We have zero tolerance for any behavior of this nature.”
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Hussais issued a statement after a meeting with the Chinese Ministry of Public Security (MPS) regarding its investigation in the business operations of GlaxoSmithKline plc (NYSE:GSK) (LON:GSK) in the country. According to him, the meeting was constructive, and the pharmaceutical company is taking the situation “extremely seriously.”
“I want to make it very clear that we share the desire of the Chinese authorities to root out corruption wherever it exists. We will continue to work together with the MPS and we will take all necessary actions required as this investigation progresses,” added Hussais.
GlaxoSmithKline supports initiative of authorities
Furthermore, Hussais said that GlaxoSmithKline plc (NYSE:GSK) (LON:GSK) supports the initiative of the authorities in China in implementing reforms in the medical sector. He emphasized that the pharmaceutical company is ready to work with authorities to make changes for the benefits of Chinese patients by evaluating its business model actively.
Moreover, Hussaid said, “In addition, savings made as a result of proposed changes to our operational model will be passed on in the form of price reductions, ensuring our medicines are more affordable to Chinese patients.”
Executives confessed to bribery and violated tax laws
Two weeks ago, the China’s Ministry of Public Security said that some of the executives of GlaxoSmithKline plc (NYSE:GSK) (LON:GSK) confessed that they committed bribery and violated tax laws in the country. The ministry said that the executives offered bribes to Chinese government officials, medical associations, hospitals and doctors to increase the prices of its products to improve sales.
GlaxoSmithKline plc (NYSE:GSK) (LON:GSK) previously denied the allegations of bribery and corruptions against its business operation in China, and argued that it is monitoring its business continuously to meet its strict compliance procedures, and found no evidence of wrongdoing. The pharmaceutical company also expressed that it will cooperate with authorities in their investigation.