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China state media detail GSK bribery allegations

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(GlobalPost/GlobalPost)

Sales agents of pharmaceutical giant GlaxoSmithKline were trained to build relationships with doctors by offering money and "catering to their pleasures", Chinese state media said Friday as the British firm faces a bribery probe.

Company representatives offered bribes of 10 to 20 yuan ($1.6-$3.2) each time doctors prescribed some GSK products in China, the official Xinhua news agency reported, giving new details of the case.

The agents "established good personal relations with doctors by catering to their pleasures or offering them money, in order to make them prescribe more drugs", Xinhua said.

Authorities have detained four Chinese GSK executives on allegations that employees used nearly $500 million in bribes to boost sales.

Police say GSK staff offered government officials and doctors bribes, and took kickbacks from travel agencies to organise conferences, some of which were fake.

Chinese authorities have not announced formal charges against GSK employees, but state media reported executives had confessed and showed the former operations manager on state television.

"Some executives gave clear directives to the sales department to offer bribes to doctors or opportunities to attend academic conferences," Xinhua quoted a GSK regional sales manager as saying.

Doctors earned a seven to 10 percent cut from sales of GSK drugs they prescribed, the report said.

GSK's chief executive Andrew Witty on Wednesday said the allegations were "shameful" and pledged to cooperate with Chinese authorities.

The company on Thursday announced the appointment of a new boss at its Chinese division, Herve Gisserot, who was previously co-head of its pharmaceutical business in Europe.

The previous head of China operations, Mark Reilly, was able to leave the country freely in early July shortly after the allegations surfaced.

In a separate report, Xinhua quoted police as saying Reilly would return to China in the "near future" to cooperate in the investigation.

GSK could not be immediately reached to comment on the reports.

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http://www.globalpost.com/dispatch/news/afp/130726/china-state-media-detail-gsk-bribery-allegations