Friday, September 13, 2013

GlaxoChinaGate contd. - German drug giant Bayer latest target of graft probe | South China Morning Post

The German pharmaceutical firm Bayer is the latest target of the mainland's ongoing investigation into malpractice in the pharmaceutical industry.

The All-China Federation of Industry and Commerce contacted a Bayer office on the mainland in relation to an investigation into anti-trust offences, Bayer's spokesman Guenter Forneck told theSouth China Morning Post in an e-mailed statement.

"We assume that this contact is related to a wider investigation into the pharmaceutical industry in China," he wrote.

The German company is the latest pharmaceutical giant to be drawn into an investigation that first came to light two months ago when police in Changsha, Hunan province, began an investigation into alleged "economic crimes" by employees of the British drug firm GlaxoSmithKline.

US firm Eli Lilly, the French firm Sanofi, the Danish firms Novo Nordisk and H. Lundbeck, the British firm AstraZeneca and the Belgian firm UCB have also said that they were contacted by investigators.

In July, the National Development and Reform Commission said it was extending its investigation to cover 60 international and domestic drugmakers.

Mainland health officials say rampant corruption in the health sector is driving up costs for patients. The investigation is aimed at cracking down on illegal practices among suppliers of pharmaceutical products on the mainland as part of a wider series of measures aimed at reforming the struggling public health care system.

Bayer said it was co-operating with the mainland authorities in the investigation. The company had strict compliance regulations in place and encouraged its employees to report violations, it said, adding that it would look into allegations of misconduct.

China is increasingly important to the firm, making up 19.5 per cent of its total global revenue in the last fiscal year.

Last week the European Union Chamber of Commerce in China's pharmaceutical working group called the industry-wide probe "unfair".

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