Drug Giant's Secret to Success Is Bribery: Cops

China says it busts scheme by Glaxo, travel agencies to bribe doctors

By Matt Cantor,  Newser Staff

Posted Jul 15, 2013 11:59 AM CDT

(Newser) – China says it knows how a few Shanghai travel agencies were managing huge revenues without many bookings, and the explanation isn't pretty: They were involved in an extensive bribery scheme with executives from drug giant GlaxoSmithKline, authorities say. The firms are accused of teaming up to bribe doctors and health organizations to boost drug sales and prices in the country, the New York Times reports. Since 2007, GSK has transferred up to $489 million to travel firms and consulting companies, an investigator says, per the BBC.

Authorities say GSK essentially used travel agencies as middlemen to funnel bribes to health firms, sometimes by putting fake conferences on the books. GSK execs then got money and travel as kickbacks. What's more, travel agencies paid women to offer "sexual bribery" to GSK managers to get the lucrative business, police say. The firm says it has "zero tolerance" for such behavior, but Chinese officials say they "found that bribery was part of the strategy of the company." China has detained four top Chinese executives at the UK drug firm, whose British boss of China operations left the country following a raid on offices.

This file photo shows the GlaxoSmithKline offices in London.
This file photo shows the GlaxoSmithKline offices in London.   (AP Photo/Kirsty Wigglesworth)
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