GSK resumes some doctor payments, backtracking on blanket ban

GSK resumes some doctor payments, backtracking on blanket ban

Now Reading:GSK resumes some doctor payments, backtracking on blanket ban

GSK resumes some doctor payments, backtracking on blanket ban
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Loriene Perera(Reuters)

By Ben Hirschler

LONDON (Reuters) – GlaxoSmithKline <GSK.L>, which five years ago stopped paying doctors for promoting its drugs, said on Tuesday it would allow such payments once again in limited circumstances.

The British group’s 2013 no-payment pledge marked a first for an industry battling past scandals over sales practices. But other drugmakers failed to follow suit, leaving it at a competitive disadvantage.

Drugmakers have long used so-called key opinion leaders to promote the benefits of their products to other prescribing physicians and the decision to abandon this strategy was questioned by a number of analysts.

GSK’s new updated policy on working with healthcare professionals will now permit payments to global experts who speak about the science behind novel new medicines.

“These changes are being made for a select number of innovative products in a limited number of countries and apply to restricted time periods in a product’s lifecycle,” the drugmaker said.

Overall, the total payments under the new arrangements are expected to be significantly below pre-2013 levels, according to one person close to the company.

GSK’s 2013 ban on paying doctors came amid a major bribery investigation in China, which landed it with a record fine, and was part of an effort by former chief executive Andrew Witty to improve the company’s reputation.

There was speculation at the time that other companies would be forced to follow suit, but in the event that did not happen.

Witty was replaced as CEO in 2017 by Emma Walmsley, who has brought a sharp commercial focus to operations, including a drive to reallocate resources to priority new medicines.

In addition to payments for speaking engagements, the updated GSK policy also allows for reasonable travel costs for medics to attend company-organised meetings – except in the United States – and registration fees for remote congress webinars and webcasts.

GSK added it would still not sponsor doctors to attend medical conferences.

(Reporting by Ben Hirschler; editing by David Evans)


Watch Out: Big Pharma’s Dirty Tricks And Tactics…

Ex-Merck employee turned anti-vaccine activist now terrorized by Big Pharma Black Ops branch

Monday, August 10, 2015 by: Julie Wilson staff writer

Today | Week | Month | Year

Ex-Merck employee turned anti-vaccine activist now terrorized by Big Pharma Black Ops branch
California to throw adults in JAIL if they refuse government-mandated vaccines

(NaturalNews) “We may need to seek them out and destroy them where they live,” wrote a Merck & Co. employee who was actively plotting to murder or discredit doctors who had voiced concerns regarding the adverse health effects of an anti-inflammatory drug called Vioxx.

Launched in 1999, Vioxx was extremely popular (with more than 80 million users worldwide), as its makers heralded the drug as being the answer to inflammation, minus the nausea that often follows with anti-inflammatory medication.

It was later discovered that the New Jersey-based Merck & Co. was knowingly selling a drug that frequently caused heart attacks and strokes in its unsuspecting victims. A study revealed that Vioxx actually doubled the risk of heart attacks and strokes, prompting the company to voluntary withdraw the drug from the market in 2004.

Prior to the drug being pulled from the market, several Merck & Co. staff exchanged emails in which they discussed a “hit list” they drafted of doctors whom they believed needed to be “neutralised” or “discredited” due to their criticism of Vioxx.

Merck & Co. long history of harassing and threatening those who stand in the way of drug profits

The emails surfaced in court after 58-year-old Graeme Peterson claimed the drug caused him to have a heart attack in 2003 after taking the medication for three years to treat his back pain and arthritis.

Merck & Co. and its Australian subsidiary, Merck Sharpe & Dohme, were sued for damages by more than 1,000 Australians (and many others in the US), who claimed that they suffered heart attacks and strokes at the hands of Vioxx.

The court ruled in Peterson’s favor, allotting him just under $300,000 in compensation; however, the ruling was reversed in 2010 by an appeal panel in Federal Court in Melbourne.

The court said it wasn’t proven that Vioxx caused Peterson’s heart attack, despite accusations that the American pharmaceutical company misconstrued Vioxx’s health risks in medical literature, advertisements and statements to doctors by sales representatives.

Big Pharma’s domestic terrorism branch emerges as vaccine truth tellers are terrorized

It seems that Merck & Co. was never held accountable for the threats it made against doctors, researchers and academics, in which at least eight clinical investigators were harassed and intimidated, giving the drug company no reason to stop such intimidation tactics.

Those same tactics are in play to this day and are carried out against anyone who stands in the way of Big Pharma’s profits. One of the most recent, and particularly disturbing, examples of this involves a woman named Brandy Vaughan, an ex-employee of Merck & Co. who used to rep Vioxx.

Vaughan worked for Merck & Co. from 2001 to 2003, but resigned after learning that her employer falsified safety data on Vioxx, covering up the fact that it doubled the risk of heart attacks and stroke.

After living overseas for quite some time, Vaughan returned back to the US with her six-month-old son and took him to a wellness visit in California. Knowing little about vaccines, but enough to know not to trust pharmaceutical companies, she asked the doctor, who was pushing for her son to be vaccinated, to see the inserts. This angered him.

He accused her of not trusting him before storming out of their visit, after which the nurse made sure to let them know that they weren’t welcome back.

The experience sent Vaughan down the rabbit hole of vaccine research, which unveiled a multitude of concerning information leading her to decide to not vaccinate her son. After learning about the flawed data on vaccines, the toxins they contain and the total lack of safety testing, Vaughan turned to activism as she began to spread awareness about the risks of vaccines, focusing particularly on speaking out against California’s SB277 forced vaccination law.

“If there’s a risk, there has to be a choice,” says Vaughan, who at the time could not predict the repercussions she would face for the influence she was having.

“Just because things are on the market, does not mean they’re safe” — Vaughan

After attending a rally against SB277 at the capitol, Vaughan returned home to a startling discovery when she found her hide-a-key laying on her front door step – with the door left open – which had been hidden in the bushes a year earlier after she purchased her home. Six months ago, she searched for the key, but it wasn’t where she had left it.

Whoever did this, their message was clear – we’re watching you and we have access to your home. Unnerved by the experience, Vaughan installed a $3,000 security system.

The second incident occurred after Vaughan exposed the names of who she believed to be the “controlled opposition” in the fight against SB277 on Facebook.

She returned home that night to her house having been broken into. Someone had picked the lock before entering through the font door and disabling her alarm system by entering the master code – a code that only she knew.

Vaughan learned through her security system that the assailant spent just four minutes in her home, walking down the hallway and opening and shutting a back window before exiting through the front door.

She called the police and spoke to a security expert with a history of carrying out intimidation tactics for corporations. Her home was likely “tapped” during the break in, she was told, meaning that everything she said and did was probably being listened to and even watched.

While the police investigated the break in, Vaughan checked to see if her computer was still in its hiding spot; it was and appeared to be undisturbed.

Terrified by this point, Vaughan decided not to stay there any longer. When she returned home two days later to pack up some of her belongings, she discovered that her computer had been removed from its hiding place and laid blatantly on the kitchen floor.

Clearly, someone had been listening and probably watching.

Below is a powerful 12-minute video detailing the intimation tactics being orchestrated against Vaughan. I encourage you all to watch as it will send chills down your spine and open your eyes to the extreme lengths corporations are willing to go to protect their profits.

Natural News felt that it was very important to inform the public about what’s happening to Vaughan. By exposing her story, we can provide her with more protection.

Moving forward with absolute bravery, Vaughan continues her activism through the non-profit she founded, the Council for Vaccine Safety, which seeks to “increase public awareness and education on the risk of vaccines while advocating for safer vaccines.”

You can check out some of her powerful speeches, as well as upcoming speaking events on her Facebook page.

The war on natural health freedom

With the discovery of at least nine dead or missing Florida-based naturopathic doctors , the passing of SB277 and the harassment toward Miss Vaughan, it’s clear that there’s a war against natural health freedom and anyone who seeks to expose the corruption so deeply rooted in the medical establishment.

Based on the recent chain of events, it’s become clear that the Black Ops branch of Big Pharma is real, and its hired assassins will go to great lengths, including murder, to silence those who stand in their way.

Natural News’ Mike Adams is no stranger to threats and intimidation tactics, as he’s been on the receiving end of many, which is why he never leaves home unarmed.

“A surprising number of people in the natural health community have come to learn, by necessity, that they need to carry concealed firearms as a practical matter of personal protection,” says Mike.

“In an age where the medical industry routinely murders babies to harvest their organs, it should be no surprise to learn that global pharmaceutical companies also hire terrorists and Black Ops personnel to try to silence anyone who interferes with their profits.”

Shroud of mystery surrounds case of dead and missing doctors

Dr. Teresa Sievers, a Florida-based naturopath who is now deceased, left conventional medicine to open her own practice, a holistic center that focuses on the mind, body and spirit connection.

On June 29, Sievers was found dead in her Bonita Springs home. She was brutally murdered, and with a hammer, according to investigators. While Lee County Police Department’s Sheriff Mike Scott says the case “has the most evidence he’s ever seen,” no arrests have been made.

While we still don’t know who or why anyone would commit such a heinous act against an innocent woman – who not only was saving lives but was a wife and mother of two young daughters – the timing and circumstances of her death eerily coincide with other area doctors who shared a similar focus and fate.

(An Indiegogo campaign was launched to help raise money for Sievers’ daughters’ college tuition; you can donate here.)

Among those found dead are Dr. James Jeffrey Bradstreet, Dr. Nicholas Gonzalez, Dr. Bruce Hedendal, Dr. Baron Holt and Dr. Lisa Riley – all of whom practiced alternative medicine. Learn more about what Bradstreet and Gonzales were studying here, here and here.

Dr. Patrick J. Fitzpatrick, a retired ophthalmologist from North Dakota and Dr. Jeffrey Whiteside, a pulmonologist from Wisconsin, both went missing in early July. More than a month has passed, and there’s still no information about their whereabouts. It appears that both doctors practiced Western medicine, so it’s unclear if they’re connected to the Florida naturopaths.

Three other doctors went missing on June 19 in Guerrero, Mexico, the same area in which 43 student teachers went missing in September 2014.

While authorities say they’ve identified the bodies, as well as found the vehicle they were riding in riddled with bullet holes, at least two of the victims’ families said the bodies they were asked to identify at the morgue was not their loved one.

The family is accusing Guerrero’s attorney general of “manipulating” the case and pretending it’s solved in order to shelf it, along with thousands of other unsolved murders in the region.

Patients First? Or Just Business As Usual?…

Pharma giant GlaxoSmithKline reveals $175K paid to hundreds of Triangle doctors

Jun 30, 2015, 5:18pm EDT Updated Jun 30, 2015, 5:26pm EDT
Jason deBruyn
Triangle Business Journ

Last year, 244 doctors in Raleigh, Durham and Chapel Hill received a combined $175,797 from drug maker GlaxoSmithKline (NYSE: GSK).

Of that, one physician, Dr. Edward Nolan Pattishall, received $59,000 and another, Dr. Roger S. Rittmaster, received $37,400. No other physician received more than $8,300 and only 20 physicians received more than $1,000. The majority of physicians received a few dozen dollars or less, mostly for food and beverage costs, but the larger payments were typically classified as “consulting” or “speaking” fees. A few cases also included travel and lodging.

Drs. Pattishall and Rittmaster could not immediately be reached. A GSK spokeswoman did not give detailed information about individual physician payments. During calendar year 2014, GSK paid U.S. physicians $36.4 million related to speaking, advising and consulting and other transfers of value. In total, GSK spending was relatively flat when comparing 2014 to 2013.

According to his LinkedIn profile, Dr. Pattishall worked with GSK from 2001 through 2011, at which point he became an “Independent pharmaceutical professional with extensive track record of success in clinical safety & pharmacovigilance and clinical development.” He holds degrees from UNC-Chapel Hill.

Data was posted Tuesday on a federal Open Payments database run by the Centers for Medicare and Medicaid Services (CMS). This data is part of the Affordable Care Act, which requires CMS to collect information from applicable manufacturers and group purchasing organizations (GPOs) in order to report information about their financial relationships with physicians and hospitals. GSK first posted its data in April.

“We expect overall payments to continue decreasing as we continue to implement our new approach to working with healthcare professionals, including stopping direct payments to external healthcare professionals to speak on our behalf about our medicines by 2016,” according to a GSK statement.
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Separately, GSK has been implementing a program it says puts patients first. One of the main changes is to decouple prescription sales in the United States from incentives to sales reps. The company had faced allegations that its sales reps improperly promoted drugs.

“GSK believes that appropriate engagement with healthcare professionals introduces more transparency into our marketing and educational efforts and it is also critical to ensuring patients have confidence in the treatment choices made by their physicians,” according to a statement, provided by Jenni Brewer Ligday, the director of U.S. External Communications.

How Does Glaxo Get Away With Global Fraud, Corporate Manslaughter And General Skullduggery?

Maybe they get away with it because they literally (and legally) bribe almost everyone?..

Check out the millions GSK gives every year to doctors and researchers..

And after you have a look at that outrageous obscenity..

Have a look at GSK’s apology letter to the Chinese people for illegally bribing doctors in their country… bear in mind this is an apology to over one billion people… GSK don’t do things by halves do they?….


Glaxo Paid Doctors $15 Million Before Promised End to Fees

Glaxo Paid Doctors $15 Million Before Promised End to Fees

by Oliver Staley
June 30, 2015 — 6:47 PM BST
Updated on July 1, 2015 — 4:09 AM BST

GlaxoSmithKline Plc paid U.S. doctors about $15 million in 2014 to promote and learn about its products, showing little change from the previous year even as it works to end most payments to physicians by 2016.

The total includes consulting and speaking fees, as well as meals and travel for thousands of doctors. The largest consulting payment — $195,000 — went to Joseph Goldstein, a professor of biomedical research at the University of Texas Southwestern Medical Center, according to Glaxo’s figures.

Glaxo, the U.K.’s biggest drugmaker, said in 2013 that at the start of 2016 it would end its practice of paying doctors to speak on its behalf or attend conferences. The changes are among reforms implemented by Chief Executive Officer Andrew Witty in the wake of a federal investigation into Glaxo’s sales and marketing practices. The company agreed to pay $3 billion in a settlement.

“We expect overall payments to continue decreasing as we continue to implement our new approach to working with health-care professionals,” Sarah Alspach, a company spokeswoman, said in an e-mail. That includes “stopping direct payments to external health-care professionals to speak on our behalf about our medicines by 2016.”

In 2014, Thomas Yunger, a pulmonologist in Dayton, Ohio, was the highest-paid speaker for Glaxo, with $75,450 in speaking fees and $10,853 for consulting, travel, food and beverage. Yunger couldn’t be reached for comment, and Goldstein declined to comment.

The fees are contained in a Glaxo report on all payments to outside doctors, which totaled $36.4 million. More than half went to the University of Rochester in New York as part of a royalty agreement.

The U.S. Centers for Medicare & Medicaid Services released similar data from all drugmakers Tuesday, part of an effort to improve transparency stemming from the 2010 Patient Protection and Affordable Care Act. Glaxo first posted its 2014 data on its website in April.

Pfizer Inc., the biggest U.S. drugmaker, reported at least $53.3 million in 2014 non-research outlays to doctors. Merck & Co. paid at least $27.5 million, and AstraZeneca Plc spent at least $72.5 million.

Glaxo’s report also includes $498,010 paid to Daniel Podolsky, a board member who is president of the University of Texas Southwestern Medical Center. The sum includes his compensation, expenses and benefits, Alspach said.

To replace its current doctor-payment system, Glaxo will have “digital, personal and real-time applications” in place by the start of 2016 to provide information to medical professionals, Alspach said.

In its 2012 agreement with the U.S. government over sales and marketing practices, Glaxo also said it would continue a program to stop compensating sales representatives based on the volume of drugs they sold. The program, started in 2011 and called Patient First, is under review to find ways it can be simplified, the company told U.S. sales employees in April.

Glaxo promoted Jack Bailey in February to replace Deirdre Connelly as head of its struggling operations in the U.S., the U.K. company’s biggest market.

“We are absolutely committed to our sales compensation model, and are confident that it is the right thing to do for our business and for patients,” Alspach said.

GSK Now Investigating Corruption In United Arab Emirates (UAE)

(Reuters) – Drugmaker GlaxoSmithKline, which was slapped with a record $489 million fine for corruption in China last month, said on Tuesday it was looking into allegations of corruption in the United Arab Emirates.

Britain’s biggest pharmaceuticals group confirmed the investigation following allegations of improper payments set out in a whistleblower’s email sent to its top management on Monday. The email, purporting to be from a GSK sales manager in the Gulf state, was seen by Reuters.

The company is already investigating alleged bribery in a number of Middle East countries, including Lebanon, Jordan, Syria and Iraq, as well as Poland.

“As we have already said, we are undertaking an investigation into our operations in the Middle East following complaints made previously. This investigation continues and these specific claims were already being investigated as part of this process,” a GSK spokesman said.

GSK and other major drugmakers are under increased scrutiny in the wake of the high-profile Chinese case and law enforcement agencies in both the United States and Britain are clamping down on overseas corruption by multinational companies.

The China scandal has hit GSK’s drug sales in the country and tarnished the reputation of Chief Executive Andrew Witty.

Other pharmaceutical companies, too, are in the firing line for alleged improper sales behavior.

France’s Sanofi said on Monday it had informed U.S. authorities of allegations of improper payments by its employees to healthcare professionals in East Africa and the Middle East.

Novartis, meanwhile, has been ordered to face a U.S. government lawsuit accusing the Swiss drugmaker of paying multimillion-dollar kickbacks.

And two women in Poland have pleaded guilty to bribery in another case involving an unnamed company.

In the case involving GSK’s practices in the UAE, the anonymous author of the email claimed that the British company made direct payments to healthcare professionals, hospitals, clinics and pharmacies to secure business.

This included payments for educational meetings — regardless of whether or not they took place — as well as schemes to pay customers for taking prescription drugs by giving them bonus over-the-counter products, the author said.

“We have zero tolerance for unethical behavior and we welcome people speaking up if they have concerns about alleged misconduct. We are committed to taking any disciplinary actions resulting from the findings,” the GSK spokesman said.

GSK Corrupt Activity In Iraq Goes Back Years…

GSK were investigated for bribing Saddam Hussein’s regime with kickbacks back in 2007, however the investigation seems to have disappeared after making headline news at the time…

Apart from the report on kickbacks in 2007, there was also a report from 2013 detailing a case where GSK are mentioned in conspiring with Hussein’s regime, the case was struck out on technicalities in the US court… In other words… they got away with it.. (no surprise there then!)…

An Iraqi lawsuit accusing more than 90 companies of conspiring with Saddam Hussein’s regime to frustrate the United Nations’  program, and depriving Iraqis of roughly $10 billion of essential aid, has been dismissed by a court in New York. (See more here)

This from 2007:

Firms accused of bribing Saddam to be investigated by fraud office

· British companies named in United Nations report
· Kickbacks ‘enabled Iraqi leader to amass $1.8bn’

The Serious Fraud Office has launched an investigation into allegations that a number of major UK-based firms paid bribes to Saddam Hussein’s regime in Iraq. The firms being targeted include the drug giants GlaxoSmithKline (GSK), AstraZeneca and Eli Lilly. 

And from 2008:

The drugs company, which has been the almost exclusive supplier of medicines and vaccines to Iraq’s ministry of health for over 20 years, is setting up a manufacturing base in the country.

The agreement with local firm Modern Drug Industries will see GSK medicines packaged and manufactured at their Baghdad facilities.

With an increasing number of international pharmaceutical companies vying for business in Iraq, GSK hopes that establishing a secondary local manufacturer will provide a significant advantage when competing for tenders in future.

GSK said producing drugs closer to the customer would improve their cost base and enable them to sell products on at an “access price”.

The company said it also has plans to open its first private business in the country since the invasion by year-end and will be hiring a “significant number” of local staff.

From 2011

Iraq remains a dangerous place to live and do business due to ongoing violence and political instability. But that isn’t stopping impatient investors anxious to take part in the nation’s rebuilding. GlaxoSmith Kline (GSK), Britain’s largest pharmaceutical company, has signed an agreement with Modern Drug Industries, an Iraqi company, to manufacture and package drugs in Baghdad.

GSK has been the Iraq Ministry of Health’s main supplier of vaccines and other medicines for more than 20 years. Now GSK plans to be the first pharma giant to enter the Iraq market since the 2003 invasion.

Harrington Investments Divests From GlaxoSmithKline (2007)

August 29, 2007

Contact: Jack Ucciferri

(707) 257-7923 Fax

(707) 252-6166 Voice

Harrington Investments Divests From GlaxoSmithKline

Cites Litany of Concerns

Napa, CA – Harrington Investments, Inc. (HII), a socially responsible investment (SRI) advisory firm, announced today that it has divested from GlaxoSmithKline (GSK) stock.

“In accordance with our long term investment management style, we would prefer to remain invested in GSK,” said John Harrington, President and CEO of Harrington Investments. “However, we have a fiduciary duty to our clients that includes a comprehensive review of a corporation’s overall operations and reputation.”

In a letter to GlaxoSmithKline CEO, Jean-Pierre Garnier, Harrington listed six points of concern with the company, including investigations for shady business dealings with Saddam Hussein, improper marketing of anti-depressants, and tax avoidance.

The letter also cited GSK’s inability to address the concerns of animal rights activists and its resistance to providing affordable AIDS drugs to developing countries.

The list concludes: “On a lighter note, we are bemused that GSK – one of the largest drug makers in the world – was recently ‘busted’ by two 14-year-old schoolgirls for wildly exaggerating the quantity of vitamin C present in a popular children’s fruit drink! Unfortunately, however, this action on the part of GSK continues to undermine your company’s reputation and your management’s credibility.”

Like many SRI firms, HII proactively avoids, or ‘screens out,’ stocks of corporations with significant negative environmental, social, and/or corporate governance (ESG) issues. Once it decides to purchase shares in a company, HII generally tries to work with corporate management to improve ESG performance.

HII’s divestiture of GSK stock is a reaction to corporate management’s consistent failure to address important investor fiduciary concerns.


Jack Ucciferri
Research and Advocacy Director (RAD)
Harrington Investments, Inc.

ph. 707.252.6166
fax 707.257.7923

GSK’s New PR Spin (Championed By Ben Goldacre) “Doctors Off The GSK Payroll”

Ben G

I think that some of the comments on this articulate my opinion better than I can myself today…

I’ll blog more on this later…

“Maybe I’m misreading this, but wasn’t this spurred by the fact that they got caught committing a crime in China?”

“Evidently we are supposed to applaud this news: one of the largest drug making companies, repeatedly caught in unethical and manipulative behavior designed to increase its already enormous market share, is now going to behave slightly better, without admitting in any way that it’s done anything wrong”

“As a former pharmaceutical sales representative, sales manager, marketing director and regional president of a pharmaceutical company I have observed the declining ethics in the industry in the last fifty years.
There were many companies,generally headed by a physician, offering a very wide range of products, both over the counter and prescription.
In my company, sales representatives were either pharmacists or had pre-med college backgrounds.
Marketing was educationally oriented. Before each two month sales program a meeting to update all research and published information was held.
Marketing information was given only to pharmacists and physicians.
As the companies were generally headed by a physician, they were very patient and service oriented.
Now there are a few, monopolistic companies. The range of products is limited by their potential sales volume.
Sales representatives preferred are “pom pom” girls because they have better “personalities” to react with the physicians. Especially when promoting erectile dysfunction products.
Marketing is to the consumer in TV, magazines, etc. emphasizing possible benefits in photos and large print and limiting possible dangerous side effect in microscopic volumes.
The advertising directly to the public is the most unethical of all. Instilling doubt, suggesting benefits and obscuring risks to a public which is not educated to evaluate is gross.”

  • slangpdx
  • portland oregon

Glaxo Says It Will Stop Paying Doctors to Promote Drugs

Glaxo is first among its peers to announce a plan to end paid-speaker programs, but it is not the only one considering such a move, said Pratap Khedkar, who oversees the pharmaceutical practice at ZS Associates, a global sales and marketing firm.

He said a handful of drug makers were weighing similar actions for several reasons, including concerns about the reaction to the required disclosure of such payments that will begin next fall under a provision of the health care law. Glaxo and several other major companies already report many such payments, but Mr. Khedkar said the new requirements may go farther than what some companies are reporting, and will be accessible on a searchable government website.

Previously, “It wasn’t really made public in some big, splashy way,” he said.

Jeff Francer, vice president and senior counsel at the Pharmaceutical Research and Manufacturers of America, the industry trade group, said many other companies were looking for ways to better reach increasingly busy doctors — who may not have time to travel to a conference in the first place — and Glaxo’s actions represent just one example.

“Of course all of our companies are looking for ways in which they can refine their relationship with physicians to make sure they’re making the best use of physicians’ time,” he said.

Beginning in 2015, Glaxo will also no longer compensate sales representatives based on the number of prescriptions doctors write, a standard practice that some have said pushed pharmaceutical sales officials to inappropriately promote drugs to doctors. In 2012, Glaxo paid a record $3 billion in fines to resolve charges that it had marketed drugs for unapproved uses. It is one of several major companies to have settled such cases in recent years.

Glaxo said its sales representatives worldwide would instead be paid based on their technical knowledge, the quality of service they provided to clients to improve patient care, and the company’s business performance. The company made such changes in the United States in 2011 — and is required to continue the new program under a corporate integrity agreement with the Justice Department — but will now extend the practices to its global business.

Mr. Khedkar said some other companies were also experimenting with ways to compensate sales representatives, but they must tread carefully.

“You remove the incentive to do anything inappropriate, but you also remove the incentive to do what is appropriate, which is to promote the on-label use of your product,” he said.

Mr. Witty said the experience in the United States had been positive and had improved relationships with doctors and medical institutions.

Dr. Raed Dweik, the new chairman of the innovation management and conflict of interest committee at the Cleveland Clinic, said he hoped other companies would follow suit.

“As a physician, I periodically meet with these sales reps and they usually come in armed with information about me that I don’t even know,” he said, like the number of prescriptions he writes for the drug company’s product. “I feel that’s not really a comfortable interaction to have.”

“GSK is ensnared in one of the biggest criminal investigations into bribery ever conducted in China”…

GSK half-year results: What Witty wanted to say

Amid the clamour over GlaxoSmithKline’s mounting crisis in China, the group has issued an upbeat set of half year results. Denise Roland reports.

Andrew Witty, CEO of GlaxoSmithKline
Sir Andrew refused to accept personal responsibility for the mounting scandal in China. He highlighted his “unrelenting focus” on getting controls right and “building a culture and values that protects us” from corruption. Photo: PA

By Denise Roland

8:10PM BST 24 Jul 2013

Comments2 Comments

Sir Andrew Witty may have been looking forward to unveiling GlaxoSmithKline’s first half results until just a few weeks ago.

There were many successes to report: better than expected sales, a robust pipeline of new drugs, and progress with lucrative asset disposals.

Instead, in a press conference following the results announcement, he faced ferocious interrogation over the company’s mounting crisis in China.

Sir Andrew fielded twenty questions in total. Nineteen of them centred on China.

The responses varied in delivery, but they drummed home the same carefully choreographed message. On five occasions Sir Andrew said he was “disappointed” by the scandal.

He stressed no fewer than 16 times that the four Chinese sales executives on whom the allegations centre worked “outside” the company’s control systems.

The message was clear: GSK’s top brass had no idea corruption was occurring and any guilt lies firmly with the sales executives who orchestrated the alleged fraud.

Glaxo is ensnared in one of the biggest criminal investigations into bribery ever conducted in China. The government’s powerful Public Security Bureau is investigating Rmb3bn (£320m) in potential bribes paid to individuals at every level of the Chinese medical system.

The allegations centre on four Chinese sales executives who have been under arrest for some weeks. One appeared to admit the charges on state television, while Chinese police claim the other three have made confessions off-screen. The quad is accused of using a complex network of “travel agents”, middlemen who arrange medical conferences and events, to funnel payments to doctors and other officials in exchange for higher prices and market share.

Sir Andrew may have refused to accept personal responsibility for the scandal, but he did make an important admission. If it emerges the four Chinese executives did manage to circumvent Glaxo’s controls, then this will “clearly raise some questions”.

And, as revealed in the Daily Telegraph on Saturday, GSK’s own probe into the matter has already uncovered evidence that appears to support some of the charges.

But had events not erupted in China, the press conference would have been a very different affair.

Sir Andrew would have produced a long list of signs that Glaxo’s growth strategy, which he set out as he took up the helm of the company five years ago, is starting to deliver.

Second quarter revenues grew 2pc year-on-year to hit £6.618bn. While the top line beat analysts’ expectations, it is the palpable prospect of future winnings that keeps investors betting on GSK.

GSK, Sir Andrew might have said, has well and truly cleared the dreaded patent cliff – the looming expiry of a drug company’s exclusive rights to produce its branded medicines.

The six “sizeable” drugs on which Glaxo has pinned its near-term growth hopes have made important strides this year. Breo, GSK’s new treatment for respiratory disease COPD, and skin cancer drugs Tafinlar and Mekinist, all won regulatory approval in the US in recent weeks. GSK expects the remaining three to get the green light by the end of the year.

Thirteen more products are in late stage clinical trials, with results expected in the next 18 months. Such a pipeline, Sir Andrew might have said, is unprecedented for Glaxo and a substantial achievement for any pharmaceutical company.

Glaxo is also a much more diversified business than it was five years ago. It has broadened its portfolio to include vaccines and consumer healthcare products such as toothpaste and over-the-counter medicines.

These areas are important for shielding Glaxo from the risks associated with drug research, but they are also key to GSK’s expansion into emerging markets, another major plank of the company’s growth plans.

Sir Andrew may also have drawn attention to two imminent asset sales which could net the company nearly £2bn. He said the sale of the company’s iconic Lucozade and Ribena brands, thought to be worth as much as £1bn, will complete by the end of the year. Glaxo has also been offered £700m for two drugs for reducing blood clots and the associated manufacturing plant.

And while the press conference may not have gone as Sir Andrew had hoped, the markets have given GSK the benefit of the doubt. The share price has remained resilient even as the crisis in China escalated in the past two weeks.

Investors may be concerned about the allegations in China, which GSK has described as “serious” and “shameful”, but they are considering the bigger picture, too. Although China is one of Glaxo’s fastest growing markets, it only accounts for around 3.5pc of total global turnover. GSK has also been keen to stress that the scandal will not see it retreat from this promising market.

Sir Andrew joined that chorus today, too. Of all the noises he made on China today, that, at least, was music to investors’ ears.

GSK’s China crisis: chief executive Andrew Witty speaks – as it happened

GSK’s China crisis: chief executive Andrew Witty speaks – as it happened

Sir Andrew Witty, chief executive of GlaxoSmithKline, speaks publicly for the first time about the cash and sexual bribery scandal that has led to the arrest of four senior executives

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Sir Andrew Witty, Chief executive of GlaxoSmithKline.
Sir Andrew Witty, chief executive of GlaxoSmithKline. Photograph: Linda Nylind

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11.36am BST

Questions Witty must answer

Britain’s biggest drug company has admitted some of its executives have broken the law, but has failed to explain who did it, what they did, when they did it or how long the company has known about it.

Follow our live coverage of his statement (midday) and conference call with the media (from 12:15pm).

Here are eight questions I think Witty – who was paid £3.9m last year – should answer.

11.46am BST

Eight questions for Witty

What have GSK staff actually done?

The Chinese authorities have accused GSK of acting like a criminal “godfather”, using a network of 700 middlemen and travel agencies to bribe doctors with £320m cash and sexual favours in return for prescribing GSK drugs.

How long have GSK China executives been allegedly breaking the law?

Gao said the police have evidence that bribery has been a “core part” of GSK China’s business model since 2007.

How much did GSK pay out in bribes? Did this inflate the price of GSK’s drugs to patients?

Gao claims GSK spent 3bn yuan (£320m) on bribes. GSK has refused to comment.

When did GSK first become aware of these allegations and why did Witty not address accusations of wrongdoing in China earlier?

The Chinese authorities announced the charges and arrested the four GSK executives on 15 July – this was just a week after the company said a four-month internal investigation found “no evidence of corruption or bribery in our China business”.

How far up the corporate food chain did the corruption reach?

GSK has refused to say how many of its executives appear to have breached Chinese laws, or name any individuals it suspects.

What will Witty do to clean up GSK’s Chinese operations?

GSK said it is taking the charges “extremely seriously” and will take “all necessary actions to … root out corruption wherever it exists”, but the company has not so far given any details of specific measures it will take.

What information has GSK passed to the Serious Fraud Office?

GSK said it is regularly briefing the SFO, but has not said what information it has passed on.

Can Witty assure shareholders that staff in other countries are not bribing doctors?

Last year GSK paid a $3bn (£1.9bn) fine in the US to settle claims that it tricked and bribed doctors into prescribing dangerous antidepressants to children. After the settlement Witty vowed that a company-wide overhaul would prevent a repeat of the scandal.

Updated at 11.57am BST

11.55am BST

China says probe to widen to other drug companies

In the latest development China’s official news agency has today hinted that more foreign and local drug companies could soon be implicated in the “rampant” bribery scandal. More on Reuters.

It will not be surprising if more pharmaceutical companies and hospitals, domestic or international, are to be involved in probes in the days to come. Big international firms should shoulder (their) due responsibilities to bid farewell to malpractice, setting a good example and serving as a wake-up call for domestic pharmaceutical companies.

Updated at 11.55am BST

12.12pm BST

Witty: China scandal will impact GSK’s performance

Witty’s only comment on the China scandal in the company’s half-year results is:

Clearly, we are likely to see some impact to our performance in China as a result of the current investigation, but it is too early to quantify the extent of this. We are co-operating fully with the Chinese authorities in this matter.

12.20pm BST

GSK sales up 2%

GSK’s sales in second quarter are up 2% to £6.6bn. Earnings per share were up 1%. the company expects to sell Lucozade and Ribena before the end of the year.

Updated at 12.36pm BST

12.22pm BST

Witty: allegations are “shameful” and “deeply disappointing”

Witty said the allegations in China are “shameful” and “deeply disappointing”.

To be crystal clear we have zero tolerance to this sort of behaviour.

12.25pm BST

Witty: GSK is “cooperating fully with the authorities”

Witty said the allegations are “totally contrary to our values”, and says the company is “cooperating fully with the authorities”.

12.27pm BST

Witty: Investigation focuses on Chinese managers, not British executives

It [the Chinese investigation] appears to be focused on a number of senior managers, potentially defrauding GSK and doing something inappropriate and illegal

Witty says there is nothing to indicate that the British management of GSK China had any role in the scandal or any knowledge of the activities of other individuals.

12.29pm BST

Witty says this investigation is “quite different” to the whistleblower claims the company recently investigated and found no evidence of wrongdoing.

12.32pm BST

Witty: UK headquarters “knew nothing” of China fraud

I am personally very disappointed. They are shameful allegations.

I remain strongly of the view that the 99.9% of individuals in this organisation are operating in the right way.

12.39pm BST

Witty: I’m “absolutely willing and ready” to go to China

Witty says he’s “absolutely willing and ready” to go to China, but says there are a lot of other issues in GSK that require his attention.

He declined to say if he would hand back some of his bonus this year if the company is found guilty of fraud in China.

12.51pm BST

Witty: GSK is cooperating with regulators in the UK and US

Witty says GSK has “opened up channels” to regulators on both sides of the Atlantic. He says the company has also “consulted with the UK government”.

12.53pm BST

Witty repeats his “absolute” commitment to “rooting out” corruption

Despite a number of journalists still requesting to ask questions, Witty said he had “run out of time” after 30 minutes of questions and closed the conference call by repeating his “absolute” commitment to “rooting out corruption”.

1.58pm BST

Witty’s answers to the Guardian’s questions

Witty ended the conference call before allowing me to put the Guardian’s eight questions to him. I have collated the best we learned from his other answers.

What have GSK staff actually done?

“It [the Chinese investigation] appears to be focused on a number of senior managers, potentially defrauding GSK and doing something inappropriate and illegal.”

He said the allegations were “shameful” and “deeply disappointing”. “To be crystal clear we have zero tolerance to this sort of behaviour,” he said.

But he refused to explain what exactly the executives have been doing. He said the investigation was in the early stages, and he was unable to provide any further details.

How long have GSK China executives been allegedly breaking the law?

Witty did not answer this question.

How much did GSK pay out in bribes? Did this inflate the price of GSK’s drugs to patients?

He did not answer this question. But he raised the possibility of discounting the price of drugs in China.

When did GSK first become aware of these allegations and why did Witty not address accusations of wrongdoing in China earlier?

Witty said GSK’s head office in London “knew nothing” of the fraud allegations until they were announced by the Chinese police last week.

He stressed that the current investigation is “quite different” to a whistleblower’s claims of corruption GSK investigated recently and said it found “no evidence of corruption or bribery in our China business”.

He did not explain why the previous four-month internal investigation did not discover the current allegations.

How far up the corporate food chain did the corruption reach?

Witty said the Chinese police’s investigation appeared to focus on the four Chinese GSK executives already detained, and he said there was nothing to indicate that GSK China’s British management – Mark Reilly and Steve Nechelput – had any knowledge of the wrongdoings. 

What will Witty do to clean up GSK’s Chinese operations?

Witty said GSK is “cooperating fully with the authorities” and was absolutely committed to rooting out corruption. He said GSK would carry out a full review of its Chinese operations and processes.

He said he was “absolutely willing and ready” to go to China, but said he has no plans to go yet.

What information has GSK passed to the Serious Fraud Office?

He did not state what information has been exchanged. But said GSK has “opened up channels” to regulators on both sides of the Atlantic. And the company has also “consulted with the UK government”.

Can Witty assure shareholders that staff in other countries are not bribing doctors?

He said he was “personally very disappointed” by the “shameful allegations”, but said he remains “strongly of the view that the 99.9% of individuals in this organisation are operating in the right way”.