GSK Have Been Bribing For A Long Time… Why Change A Successful Business Model?

From the BBC 2002

uesday, 12 March, 2002, 16:35 GMT

Glaxo probed over doctor freebies
Mascot Footix holds a replica of a ticket for the World Cup in Paris in 1998.

World Cup ticket giveaways are under investigation

German prosecutors are investigating the offer of perks, such as free World Cup and Formula One trips, to thousands of German doctors by British pharmaceuticals company GlaxoSmithKline (GSK).

Europe’s biggest drugs firm said it was cooperating fully with the investigation and added the accusations stemmed from the period between 1997 and 1999, before Glaxo Wellcome merged with SmithKline Beecham in 2000.

“These are allegations we take extremely seriously … We are investigating this internally and we will review this on a European wide basis,” Christopher Viehbacher, President of European Pharmaceuticals at GlaxoSmithline told the BBC’s World Business Report.

Munich’s chief prosecutor Manfred Wick said GSK offered money, free trips and other benefits to about 4,000 hospital doctors, and that there were suspicions of bribery and tax evasion.

The prosecutor said cash sums ranged from 50 to 25,000 euros (£30 to £15,400).

GSK’s defence

GSK said it had offered the prosecutor “active support” but had “no further information, beyond what is already presently in the media”.

“Two years ago the police came in on some suspicion of commercial activities and carted away 600 files and in the last two years have been going through those,” said Mr Viehbacher.

The accusations cover the period from 1997 to 1999, the company said in a statement.

“The company has been newly restructured through the merger of Glaxo Wellcome and SmithKline Beecham and many positions have been newly defined and filled; responsibilities have changed,” added the statement.

The allegations

The prosecutor’s office in the Bavarian capital Munich said in a statement it had uncovered evidence of 5,900 instances where SmithKline Beecham had illicitly paid for doctors to take business and training trips.

“The gifts amounted to several thousand marks, in some cases between 10,000 and 50,000 marks (£3,150 and £15,750),” it said.

The majority of individual cases had been dropped due to the small sums involved, but 100 cases against doctors and 380 involving SmithKline employees were being pursued, the prosecutor said.

Mr Viehbacher said the 380 SmithKline employees “pretty much would represent our field force prior to the merger”.




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