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Travel ban on director of GSK

Updated: 2013-07-19 00:44
By WANG HONGYI ( China Daily)

The financial director of British pharmaceutical company GlaxoSmithKline, which is involved in suspected bribery and tax-related violations, has been banned from leaving China.

"We have been aware of travel restrictions for Steve Nechelput since the end of June. His travel is unrestricted within China," a spokeswoman for GSK China told China Daily on Thursday.

"It is important to stress that at no time has he been questioned or arrested, nor is he one of the individuals in detention," she said.

Earlier this month, Chinese police accused GSK China of bribing Chinese officials and doctors so as to boost the sales of its products. So far, four senior Chinese executives at the company have been detained.

The company has also been accused of transferring up to 3 billion yuan ($489 million) to 700 middlemen over six years to facilitate the corruption.

As the investigation of GSK China widens, at least four multinational drug makers are also being investigated by Chinese authorities, according to a lawyer in Hong Kong whose firm offers advice on cross-border anti-corruption issues for companies.

"We are aware of four pharmaceutical companies who are facing investigation by local anti-corruption units," Wendy Wysong, a lawyer who is the head of anti-corruption practice in the Asia-Pacific at law firm Clifford Chance, was quoted by Bloomberg as saying.

However, she declined to identify the companies involved.

The GSK case has sparked widening concern and disputes across China's pharmaceutical sector. The sector has been subject to various reforms of late in an attempt to control the high cost of medicines for patients in China.

China is also a major market for international pharmaceutical companies, which are seeking growth areas to make up for slower sales in developed countries where patent protection is due to expire on certain drugs.

According to the international healthcare market researcher IMS Health, China will overtake Japan as the world's second-biggest drugs market behind the United States by 2016.

Shen Danyang, spokesman for the Ministry of Commerce, said the investigation by China's authorities into GSK China was part of the country's efforts to improve the business climate and create equal competition opportunities for domestic and overseas investors.

Shen made the remarks at a news conference on Wednesday, and he said China firmly opposes any form of commercial bribery, regardless of whether the company involved is local or foreign. Any company, be it Chinese- or foreign-funded, should be subject to legal sanctions and assume legal responsibility if it breaks Chinese law, Shen said.

As a well-known multinational company, GSK should also conduct investment activities in China in accordance with relevant Chinese laws, Shen added.

Xinhua contributed to this story.

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