GlaxoSmithKline Plc has confirmed yesterday that the company is currently investigated by the UK Serious Fraud Office. The announcement came at the heels of the investigation launched in China over the drugmaker's bribery to boost its regional sales there, Bloomberg noted.
The statement read, "(The Serious Fraud Office) has opened a formal criminal investigation into the group's commercial practices. GSK is committed to operating its business to the highest ethical standards and will continue to cooperate fully with the SFO."
The bribery charges were not only happening in the mainland. Allegations had also surfaced, saying that GSK employees were also involved in wrongdoing in the pharmaceutical company's units in Iraq, Poland, Jordan and Lebanon. Aside from China and UK, the US Justice Department has also started looking into bribery allegations by Glaxo and other drugmakers since 2010.
When Bloomberg reached GSK via email for comment, spokesman David Madwsley said that the company will not be making additional comments other than the statement released yesterday. Mawdsley also refused to confirm whether the UK probe would also involve China.
In a report to investors, analyst Stephen McGarry at Societe Generale in London said that the UK probe launched on GSK might be procedural. He added that any allegation of wrongdoing lodged against a company warrants an investigation. McGarry also said that GSK will be able to emerge unscathed from the UK probe if the company could prove it has strong anti-bribery policies in place and that the alleged bribes were done solely by rogue workers.
He wrote, "(Although) GSK may not have a major financial liability from any U.K. and/or U.S. investigation, the headline alone, especially if the U.S. launches an investigation, may restrain GSK's share price performance."
Bloomberg said GSK had been the one who informed the UK regulator, as well as the US Department of Justice and Securities and Exchange Commission about the Chinese probe, if to take its word in the company's quarterly report.
