GlaxoSmithKline is conducting an internal investigation into allegations that its subsidiary in Yemen hired government employees to influence purchasing decisions and boost sales of its medicines.
Specifically, more than a half-dozen Glaxo employees allegedly have also held various paid positions — such as pharmacists — at the government health ministry. The allegations are similar to those made two years ago concerning its operations in Iraq.
“GSK has received allegations about staff conduct in Yemen and is investigating them thoroughly,” a company spokesman wrote us. He declined further comment.
Last month, Glaxo distributed a notice to its employees in Yemen — who only number about three dozen — that requires them to preserve documents in connection with United States and United Kingdom inquiries into its business practices in various markets. Pharmalot has reviewed a copy of the notice.
The drug maker is currently being investigated by the US Department of Justice and the US Securities and Exchange Commission for potential violations of the Foreign Corrupt Practices Act. The UK’s Serious Fraud Office is also investigating Glaxo for possible criminal violations of the Bribery Act.
In connection with the US and UK probes, the Glaxo notice mentions that employees must retain documents concerning payments to health care providers and government entities, as well as any “concurrent” employment involving Glaxo personnel.
The notice also required employees in the Yemen subsidiary to preserve documents concerning the Tykerb breast cancer medication, which Glaxo transferred last year to Novartis (NVS) as part of an asset swap that sent much of the Glaxo oncology business to Novartis in exchange for a vaccines unit.
This is only the latest instance in which Glaxo has conducted an internal probe into business practices in various countries. Over the past two years, the company has also confronted allegations of bribery in Poland, Jordan, Lebanon, and Syria.
The most sensational episode, however, occurred three years ago in China, where GlaxoSmithKline (GSK) was eventually found guilty by a Chinese court of bribing doctors, hospitals, and other nongovernment personnel and fined more than $490 million.
Glaxo is not the only drug maker encountering scrutiny over its business practices in far-flung markets.
In recent weeks, Novartis began an internal probe into allegations of bribery in Turkey and its South Korea offices were raided by authorities there. The company also agreed to pay $25 million to settle charges of violating the Foreign Corrupt Practices Act by making illegal payments to doctors in China.
And recently, Bristol-Myers Squibb ended payments to doctors in China shortly after agreeing to pay more than $14 million to resolve charges that it violated the Foreign Corrupt Practices Act by making illegal payments to health care providers in the country.