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Sanofi ‘co-operating’ with China bribery case

Published on 12/08/13 at 09:12am
Sanofi HQ

 

Sanofi says it will co-operate into a review of its business in China after allegations of bribery were levied at the firm this week.

The French company has been accused by a whistle-blower of bribing more than 500 Chinese doctors with about 1.7 million yuan ($277,600) of payments to raise sales.

These bribes have allegedly been disguised as ‘research grants’ for more than half of the payments, which are said to have been made in 2007.

An anonymous whistle-blower told the 21st Century Business Herald newspaper that Sanofi staff paid bribes to 503 doctors at 79 hospitals in Shanghai, Beijing, Hangzhou and Guangzhou in late 2007.

China’s Xinhua state news agency, which cited a health bureau official, said over the weekend that the team investigating Sanofi would include ‘disciplinary authorities’ and the Beijing municipal health bureau.

The health official added that it would also look for clinical research programmes with lists of patient names and medical reports.

In a statement Sanofi said that it took the report ‘very seriously’, but added: “At this time, it would be premature to comment on events that may have occurred in 2007.”

Sanofi added to this statement over the weekend, saying that it was “committed to co-operating with the authorities in any review they undertake regarding these allegations”.

China syndrome and high prices                                                              

Last month GSK was embroiled in a similar investigation into the company’s use of travel agencies, which Chinese authorities say were used by GSK to launder more than £300 million worth of bribes to doctors, hospitals and pharma groups.

The London-based firm has now admitted that some of its staff, unbeknownst to headquarters, may have undertaken some of the accusations. GSK said it too is looking to co-operate with the Chinese authorities, and hinted that it may lower drug prices in the region.

High drug prices are a major issue in China as some of its medicines have price tags 30% - 40% higher than those in the West.

To help combat this, the National Development and Reform Commission is conducting an industry-wide inquiry into the pricing of medicines. The NDRC can impose hefty civil penalties on companies that violate China’s 2008 anti-monopoly law.

Just last week the Commission issued its biggest ever penalties, $110 million, for pricing violations against baby formula firms Mead Johnson and Danone unit Dumex.

This was related to the firms’ allegedly punishing distributors who tried to lower retail prices below set limits.

Ben Adams

 

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