Financial News

  • 1 July 2014, 10:03

GSK Sex Tape 'Complicates' China Bribe Claims

GlaxoSmithKline's (GSK) has confirmed its top boss in China was filmed in a covert sex tape prior to a bribery investigation being launched by officials.

Secret footage of Mark Reilly in his Shanghai apartment with his Chinese girlfriend, believed to have been taken early last year, was then emailed to board members of the UK drug giant.

In July, the FTSE 100 pharma firm saw four China staff arrested over corruption claims involving doctors and hospitals enticed to prescribe the firms' drugs.

Allegations centre on around 280m being funnelled to doctors through travel agencies.

A GSK spokesman confirmed the tape's existence, first revealed by the Sunday Times, but did not comment on how it related to the alleged bribery scandal.

The west London-based firm said in a statement: "The issues relating to our China business are very difficult and complicated."

Other reports indicate that GSK commissioned a China-based British private investigator, Peter Humphrey, to find out who planted the hidden camera in Mr Reilly's bedroom.

Mr Humphrey was unable to uncover the perpetrator or who subsequently emailed footage to the UK directors.

But Mr Humphrey and his American wife, Yu Yingzeng, were arrested by Chinese authorities in August.

GSK later apologised for staff operating outside of formal company guidelines.

In April, the company came under scrutiny in Poland over bribery allegations dating from 2011.

Those claims were raised just days after GSK said it was investigating alleged improper sales practices in Iraq.

GSK said it looked at all corruption cases seriously but denied a pattern of wrongdoing.

In its most recent annual report, the company revealed that 161 violations of marketing and sales practices were documented last year, with a total of 48 people subsequently leaving the firm.

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