News / Economy

More Foreign Pharmaceutical Firms Could be Probed in China

A Chinese national flag flutters in front of a GlaxoSmithKline (GSK) office building in Shanghai, July 12, 2013.
A Chinese national flag flutters in front of a GlaxoSmithKline (GSK) office building in Shanghai, July 12, 2013.
TEXT SIZE - +
Reuters
— China's official news agency hinted that more foreign pharmaceutical firms could soon be implicated in a corruption scandal sweeping the industry, in the wake of bribery accusations against British drugmaker GlaxoSmithKline.

"It will not be surprising if more pharmaceutical companies and hospitals, domestic or international, are to be involved in probes in the days to come,'' the Xinhua news agency said on Wednesday in an English-language commentary.

Xinhua did not name any firms or hospitals, but said the government was trying to tackle "rampant'' malpractice in the pharmaceutical sector, including corruption.
    
Underscoring the rot in China's health sector, state media said more than 1,000 doctors, nurses and administrators at 73 hospitals in Zhangzhou city in the southeastern province of Fujian had been found taking kickbacks.

State broadcaster CCTV said 90 percent of the city's doctors were involved and that authorities had recovered 20.5 million yuan ($3.34 million) in illicit funds after a six month investigation.
   
A lot of the kickbacks revolved around the distribution of medicines, CCTV said. It said 57 people, called "drug reps" in the report, had been detained. CCTV did not name any companies.

Chinese police have accused GlaxoSmithKline of funneling up to 3 billion yuan ($488.81 million) to travel agencies to facilitate bribes to doctors and officials to boost sales and the price of its medicines in China.

GSK has called the accusations "shameful" and on Monday said some of its Chinese executives appeared to have broken the law.

Xinhua said multinational pharmaceutical companies should set a good example for local firms.

"Big international firms should shoulder [their] due responsibilities to bid farewell to malpractice," it said.

Such commentaries, while not official statements, provide a window into the government's thinking. English-language commentaries are also often intended for international consumption.

Government crackdown

Xinhua said the following government agencies were all taking action: the ministries of public security and health, the National Development and Reform Commission, which sets prices, and the State Administration for Industry and Commerce, a regulator.

"It is true that malpractice has [been] rampant in China's pharmaceutical industry and hospitals for years, but now China [is] determined to reform its health system and root out malpractice, including taking kickbacks and price-fixing," the commentary added.

Chinese police have questioned local employees from another British drugmaker, AstraZeneca. The company has said police were treating this as an individual case and not related to other investigations.

Authorities have also visited the offices of Belgian drugmaker UCB. And the authorities have detained a British and a U.S. citizen, although it is not clear if those detentions were directly linked to the pharmaceutical probe sparked by the GSK allegations.

Corruption in China's pharmaceutical industry is fueled in part by the low base salaries for doctors at the country's 13,500 public hospitals.

On Tuesday, Xinhua said 39 employees at a hospital in southern Guangdong province would be punished for taking kickbacks totaling 2.82 million yuan from two local drugmakers between January 2010 and December 2012.

China has committed to making health care affordable for its 1.37 billion people. But ordinary Chinese cite the cost of medicine as a major irritant. Many Chinese prefer foreign brands over local drugs because of the widespread circulation of fake medicine.

China's State Council, or cabinet, on Wednesday said in a statement posted on the government's website that it would reform drug pricing and procurement mechanisms, guarantee drug quality and "fairly reduce drug costs... and resolutely investigate illicit kickback behavior."

You May Like

Multimedia Anti-Keystone XL Protests Continue

Demonstrators are worried about pipeline's effect on climate change, their traditional way of life, health and safety More

Thailand's Political Power Struggle Continues

Court gave Prime Minister Yingluck Shinawatra until May 2 to prepare her defense over abuse of power charges but uncertainty remains over election timing More

Malaysia Plane Search Tests Limits of Ocean Mapping Technology

Expert tells VOA existing equipment’s maximum operating depth is around 6 kilometers as operation continues on ocean bed for any trace of MH370 More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Pet Kangaroo Helps Spread Environmental Messagei
X
Penelope Poulou
April 22, 2014 5:53 PM
Children’s author Julia Heckathorn travels the world to learn about different ecosystems and endangered animals. She pours her knowledge into children’s books, hoping the next generation will right the environmental wrongs of our times. As in many children's books, the main character in Heckathorn's stories is an animal. Unlike those other characters, though, this one is real - a kangaroo, that lives in the author’s backyard. VOA’s Penelope Poulou has more.
Video

Video Pet Kangaroo Helps Spread Environmental Message

Children’s author Julia Heckathorn travels the world to learn about different ecosystems and endangered animals. She pours her knowledge into children’s books, hoping the next generation will right the environmental wrongs of our times. As in many children's books, the main character in Heckathorn's stories is an animal. Unlike those other characters, though, this one is real - a kangaroo, that lives in the author’s backyard. VOA’s Penelope Poulou has more.
Video

Video Pro-Russian Separatists Plan 'Federalization Referendum' in Eastern Ukraine

Pro-Russian separatists in eastern Ukraine say they plan to move forward next month with a referendum vote for greater autonomy, despite the Geneva agreement reached with Russia, the U.S. and Ukraine to end the political conflict. VOA's Brian Padden reports from the city of Donetsk in Eastern Ukraine.
Video

Video Pope Francis Hopes Dual Canonizations Will Reconcile Church

On April 27, two popes - John the XXIII and John Paul II - will be made saints in a ceremony at St. Peter’s Square. VOA religion correspondent Jerome Socolovsky says the dual canonization is part of the current pope’s program to reconcile liberals and conservatives in the Roman Catholic Church.
Video

Video In Capturing Nature's Majesty, Film Makes Case for Its Survival

French filmmaker Luc Jacquet won worldwide acclaim for his 2005 Academy Award-winning documentary "March of the Penguins". Now Jacquet is back with a new film that takes movie-goers deep into the heart of a tropical rainforest - not only to celebrate its grandeur, but to make the case for its survival. VOA's Rosanne Skirble reports.
Video

Video Boston Marathon Bittersweet for Many Runners

Monday's running of the Boston Marathon was bittersweet for many of the 36,000 participants as they finished the run that was interrupted by a double bombing last year. Many gathered along the route paid respect to the four people killed as a result of two bombings near the finish line. VOA's Carolyn Presutti returned to Boston this year to follow two runners, forever changed because of the crimes.
Video

Video International Students Learn Film Production in World's Movie Capital

Hollywood - which is part of Los Angeles - is the movie capital of the world, and many aspiring filmmakers go there in hopes of breaking into the movie business. Mike O'Sullivan reports that regional universities are also a magnet for students who hope to become producers or directors.
Video

Video Pacific Rim Trade Deal Proves Elusive

With the U.S.-led war in Iraq ended and American military involvement in Afghanistan winding down, President Barack Obama has sought to pivot the country's foreign policy focus towards Asia. One aspect of that pivot is the negotiation of a free-trade agreement among 12 Pacific Rim nations. But as Obama leaves this week on a trip to four Asian countries he has found it very difficult to complete the trade pact. VOA's Ken Bredemeier has more from Washington.
Video

Video Autistic Adults Face Housing, Job Challenges

Many parents of children with disabilities fear for the future of their adult child. It can be difficult to find services to help adults with disabilities - physical, mental or emotional - find work or live on their own. The mother of an autistic boy set up a foundation to advocate for the estimated 1.2 million American adults with autism, a developmental disorder that causes communication difficulties and often social difficulties. VOA's Faiza Elmasry reports.
AppleAndroid

World Currencies

EUR
USD
0.7217
JPY
USD
102.17
GBP
USD
0.5949
CAD
USD
1.1009
INR
USD
60.326

Rates may not be current.