Cameron Defends Glaxo After Raising Probe With China
Cameron has been joined by Glaxo Chief Executive Officer Andrew Witty on his trade mission to China this week, and has raised Glaxo’s case with the Chinese leadership. He also referred to Peter Humphrey, the British founder of a consultancy serving multinational companies. Chinese authorities arrested Humphrey and his wife in August over obtaining and selling information on Chinese citizens.
“From all my dealings with GSK, I know that they are a very important, very decent and strong British business that is a long-term investor in China,” Cameron told reporters in Shanghai. “It’s a business that very much does think about the long-term development of its products and its businesses. I think it is right to raise a case like that.”
China began the anti-corruption investigation of London-based Glaxo in July. Allegations by China’s government that the drugmaker bribed hospitals, doctors and officials prompted Witty to dispatch his head of emerging markets, Abbas Hussain, there to oversee the company’s response.
Cameron said he didn’t want to comment on an ongoing case such as the Glaxo probe.
“Britain has a record of properly standing up for British businesses and British individuals, raising individual cases in the right way and about having a proper dialogue with the Chinese authorities about the issues,” he said.
The probe was largely responsible for Glaxo’s sales of pharmaceuticals and vaccines in China plunging 61 percent in the three months through September. The company hasn’t given an outlook on how long the downturn may last.
While China accounts for slightly less than 3.5 percent of Glaxo’s global pharmaceuticals revenue and is less profitable than its Western businesses, the world’s most populous nation presents significant growth opportunities.
AstraZeneca Plc (AZN), Britain’s second-biggest drugmaker after Glaxo, said sales in China grew 22 percent in October after gaining 18 percent at constant-exchange rates in the first nine months of the year. The company is confident that its practices in China comply with local regulations, CEO Pascal Soriot told a conference in London yesterday.
AstraZeneca is increasing its investment in China, adding more sales representatives even as prices have declined, Soriot said in August. A sales representative in China who had been arrested was released and no charges were brought, AstraZeneca said in October.
AstraZeneca shares declined 0.5 percent to 3,490 pence at 8:06 a.m. today in London. Glaxo fell as much as 0.5 percent to the lowest level since Oct. 24.
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