GlaxoSmithKline China scandal: British man arrested


http://www.theguardian.com/business/2013/aug/21/glaxos-smithkline-china-british-couple-arrested

A Chinese employee walks into a GlaxoSmithKline (GSK) office in Beijing
A Chinese employee walks into a GlaxoSmithKline office in Beijing. Peter Humphrey and Yu Yingzeng were detained as police investigated bribery allegations involving the company. Photograph: Jason Lee/Reuters

A British risk consultant held in China since mid-July amid an investigation into the country’s pharmaceutical industry has been arrested, the British embassy in Beijing and his family said on Wednesday.

Peter Humphrey and his wife, Yu Yingzeng, were detained in Shanghai on 10 July as police investigated bribery allegations against GlaxoSmithKline.

In China, an arrest typically means police believe they have enough evidence for a case to be brought to trial. Detentions can last for weeks and end in release without charges being filed.

It was not immediately clear if Humphrey’s arrest was directly related to the investigation of GSK, which has been accused by China of funnelling up to 3bn yuan (£312m) to travel agencies to facilitate bribes to doctors and officials.

China has taken a tough stance on corruption and high prices in the pharmaceutical industry as it widens access to healthcare, bringing an estimated $1tn healthcare bill by 2020.

“We can confirm the arrest of a British national, Peter Humphrey, in Shanghai on Monday19 August. We are currently providing consular assistance,” a British embassy spokeswoman, Hannah Oussedik, told Reuters by phone.

Oussedik declined to offer additional information about the reasons for Humphrey’s arrest. The US embassy in Beijing could not be reached immediately to confirm whether Yu had also been arrested. The US consulate in Shanghai declined to comment.

Shanghai police did not respond to a request for comment.

A statement issued by a member of Humphrey’s family said both Humphrey and Yu had been arrested.

A source close to the family said they had not yet been told which charges would be laid against Humphrey, or when, but the statement said lawyers had told the family that the couple were detained last month because they had broken a law related to buying private information.

Humphrey and Yu co-founded ChinaWhys, a business risk advisory firm that has done work with drug companies, including GSK, separate sources familiar with the matter have said.

Humphrey worked as a journalist for Reuters in the 1980s and 90s. The ChinaWhys website says he has been a risk management specialist and corporate detective for 14 years.

In March 2010, four executives from mining giant Rio Tinto were jailed for taking bribes and stealing commercial secrets. Three of those executives were Chinese while the fourth was a Chinese-born Australian.

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