GlaxoSmithKline brings in new China bosses to shore up reputation

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GlaxoSmithKline has brought in two new executives to oversee sales and marketing in China, as Britain's biggest drugmaker tries to ensure there is no repetition of a damaging corruption scandal in that country.

A new general manager for China, Herve Gisserot, was appointed last summer and has now brought in German national Thomas Willemsen to look after sales while US-educated Wang Yizhe will take charge of marketing.

The shakeup comes amid continued investigations by Chinese regulators, as well as an inquiry by a GSK-appointed law firm, following allegations last year that about £320m of favours were given to doctors who used the company's treatments.

The London head office confirmed the new hires but declined to provide more details. "As we have made consistently clear we are committed to China and to serving the needs of patients. The new management team in the country are shaping our business to best meet that purpose," said a spokesman.

Industry analysts said it was significant that GSK had brought in managers with foreign experience as some have blamed the problems on the lack of control over local staff. "This is another challenge for MNCs (multinational corporations) because for decades they have relied on these local teams. Suddenly these companies are having to examine how they have achieved their rapid growth," Leon Liu, a partner at law firm MWE China, told Reuters.

Bribery between sales staff and doctors is said to be rife in China, with tough sales targets and low doctor salaries creating a breeding ground for backhanders. But GSK finds it difficult to blame local conditions in east Asia entirely for its troubles as it has also been forced to start investigating further claims that bungs were given to doctors in Poland, Iraq, Jordan and Lebanon.

Less than two years ago, GSK was fined almost £2bn in the US after it admitted bribing medics and encouraging the prescription of unsuitable antidepressants to children. The latest scandals have led to speculation there could be a probe into the company's activities by the Serious Fraud Office in Britain but the company has insisted there is nothing systemic about these problems.

Meanwhile, the wider pharmaceutical sector is in the middle of its own restructuring with GSK and Swiss rival Novartis agreeing a multibillion-dollar swap of assets in consumer healthcare to combine brands including Aquafresh and Beechams, while exchanging their oncology and vaccine businesses.

The deal comes amid speculation that US drugs group Pfizer is considering a $100bn (£60bn) bid for Britain's AstraZeneca, while Canada's Valeant Pharmaceuticals confirmed a $46.5bn move for Allergan, the California-based maker of Botox, on Tuesday.

Powered by Guardian.co.ukThis article was written by Terry Macalister, for theguardian.com on Friday 25th April 2014 16.35 Europe/London

guardian.co.uk © Guardian News and Media Limited 2010

 

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