HONG KONG — In a record penalty, a court in southern China on Friday imposed a fine of nearly $500 million on GlaxoSmithKline, the British pharmaceutical giant, the Xinhua news agency reported. The court sentenced Glaxo's former head of China operations up to 3 years in prison, and said he would be deported, the report said.
The penalty was for bribery in a case that has exposed widespread corruption in China's medical sector.
The fine of 3 billion renminbi, or $487 million, was imposed on the company by a court in Changsha, the capital of Hunan Province, after a secret trial against GlaxoSmithKline's China unit and its former head, Mark Reilly, on the bribery charges, said Xinhua, the state-run news agency. "This is the biggest fine ever issued in China up until now," said the brief Xinhua report.
Mr. Reilly and four other defendants, apparently Chinese nationals, all received prison sentences of up to 3 years, said the report. The Xinhua report said that Mr. Reilly and the others had pleaded guilty and would not appeal the verdicts.
The court said that in deciding how to punish Mr. Reilly, it had taken into account that he had returned from Britain to face the investigators, and that he had "truthfully recounted the crimes of his employer," meriting a relatively lenient punishment, said the Xinhua report. The other defendants also confessed and also earned relatively light sentences, said the report.
The Xinhua report said that Mr. Reilly's sentence would be suspended for four years, and that he would be deported. But the vague wording left unclear whether deportation wuld be immediate.
Glaxo published a statement on its website that it "sincerely apologizes to the Chinese patients, doctors and hospitals, and to the Chinese government and the Chinese people."
The British Embassy in Beijing said that an appeal remained possible, but that it would have no comment on the outcome of the trial. "We note the verdict in this case," an embassy spokesman said. "We have continually called for a just conclusion in the case in accordance with Chinese law. It would be wrong to comment while the case remains open to appeal."
The spokesman said the embassy had no information on the possible deportation of Mr. Reilly.
Chinese police had accused Mr. Reilly or orchestrating a "massive bribery network" that brought the company higher drug prices and illegal revenue of more than $150 million, investigators said in May. Mr. Reilly, a Briton, and two Chinese-born executives, Zhang Guowei and Zhao Hongyan, had even bribed government officials in Beijing and Shanghai, they said.
The Chinese authorities have also alleged that people working for the drug maker bribed doctors and hospital staff, and channeled illicit kickbacks through travel agencies, pharmaceutical industry associations and other channels.
Jane Perlez contibuted reporting from Beijing.
source : http://rss.nytimes.com/c/34625/f/640316/s/3e9fb398/sc/24/l/0L0Snytimes0N0C20A140C0A90C20A0Cbusiness0Cinternational0Cchina0Efines0Eglaxo0Eglaxosmithkline0Enearly0E50A0A0Emillion0Ein0Egsk0Ebribery0Ecase0Bhtml0Dpartner0Frss0Gemc0Frss/story01.htm
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