China Widens Probe of Sexual Bribes and Glaxo Execs

REPLAY VIDEO
Your next video will start in
Pause
  • Info

  • Comments

  • VIDEO TEXT

July 16 (Bloomberg) -- China is investigating at least four multinational drugmakers as it widens its probe of GlaxoSmithKline Plc, according to a lawyer in Hong Kong whose firm advises companies on cross-border anti-corruption. Olivia Sterns reports on Bloomberg Television's "Market Makers." (Source: Bloomberg)

What exactly are they being accused of?

Some very wild allegations.

They have been raking it in, and china.

20% last year, four times faster than emerging markets.

Police say they have in paying out bribes even sometimes in the form of sexual favors.

The allegations are that executives use travel agencies as conduits to receive these bribes.

They say some executives took sexual favors and other drugmakers transferred money to the agency.

They say bribes went to government officials, hospitals, doctors, allegedly nearly half $1 billion.

For chinese executives are being detained.

The cost of the bribes gets passed on to the price of the drugs.

In these businesses, i think the operation costs involved in the medicine are higher.

Everything needs a cost, such as holding a meeting or conference.

The cost should be included into the medicine prize.

-- price.

In response to these allegations, they say they are deeply concerned and are reviewing all third-party agency relationships.

They said they will cooperate with the chinese authorities.

Glaxo is not the only company that has been caught up in this regulatory dragnet in china.

There are currently four multinational drugmakers who are facing the authorities.

These companies are seeking legal advice.

A couple of weeks ago you had a man -- medical executive on the phone who was being held hostage in china.

We are seeing broadly and effort by regulators to try to crack down on corruption.

I was speaking to jeff jonas and he thinks this is an attempt by the administration with new leadership in place to be shown as taking a tough stance on corruption and also an attempt to lower prices.

He says the chinese prefer local ownership and manufacturing.

This text has been automatically generated. It may not be 100% accurate.

Advertisement

BTV Channel Finder

Channel_finder_loader

ZIP is required for U.S. locations

Bloomberg Television in   change