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GSK China rep speaks out over ‘bribery culture’

Published on 02/04/14 at 04:14pm
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A former sales representative for GlaxoSmithKline has spoken of the firm’s alleged tactics in bribing poorly paid doctors in China in order to prescribe its medicines.

Speaking to a Financial Times journalist in Shanghai, a man in his 20s who did not reveal his name, told the newspaper about his experience as a former drug salesman for the London-based company.  

“We did get training in compliance,” he said. “But then our team leader took us off individually to tell us how to offer kickbacks. We weren’t allowed to talk about that, in the office.

“Our sales model was the same as other multi-national drug companies in China,” i.e., offering cash, meals or travel to low-paid doctors to encourage them to buy medicines.

“GSK’s sales targets were maybe more aggressive than most, but everyone was doing it, domestic and foreign,” he added. “But the bonus was very high if you reached those targets so that stimulated us to try every means to get there”.

This comes nearly a year after GSK was first indicated in a major scandal in the country. The firm stands accused of laundering hundreds of millions of pounds through travel agencies in order to bribes doctors.

The former sales rep told the FT that ‘big-ticket bribes’ were laundered through travel agents whose fake invoicing practices are now being investigated by Chinese authorities.

But smaller kickbacks were paid in cash, or in kind, depending on an individual doctor’s preference.

“I bought fake tax receipts, or collected receipts from family and friends for taxis and meals, so that I could account to the company for the amounts I gave to the doctors,” he said.

This type of behaviour appears to pay dividends for reps. A base salary of Rmb7,500 a month (already high by Shanghai standards); and a quarterly bonus of Rmb17,000 if sales targets were met (plus an additional 5% of sales above the target).

The former rep continued that the average industry kickback was five to 20% of the value of the drug. He left because of the risk of getting caught, and former colleagues who stayed behind “don’t know what they are supposed to be doing because the former model no longer works,” he said.

He added: “The company still wants them to talk to doctors about product information but it’s very difficult to find doctors willing to listen without financial benefit”.

GSK says in response to these allegations: “The behaviour described by this ex-employee is completely unacceptable and we have zero tolerance for unethical conduct of this kind. We believe the vast majority of our employees in China operate to the highest standards and anyone who does not has no place in our company.”

Ben Adams 

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