* GSK says investigating alleged "improper conduct" in Iraq
* Allegations relate to small number of staff in country
* Iraq issue follows claims of extensive corruption in China
By Ben Hirschler
LONDON, April 6 (Reuters) - Drugmaker GlaxoSmithKine
, already facing corruption accusations in China, is now
investigating allegations of bribery in Iraq, the British
company said on Sunday.
The latest controversy centres on claims that the company
hired government-employed physicians and pharmacists in Iraq as
paid sales representatives to improperly boost use of its
"We are investigating allegations of improper conduct in our
Iraq business. We have zero tolerance for unethical or illegal
behaviour," a company spokesman said.
The investigations are ongoing.
GSK employs fewer than 60 people in its pharmaceuticals
operation in Iraq and the allegations relate to a small number
of individuals in the country, the spokesman added.
Britain's biggest drugmaker was accused by Chinese
authorities in July of funnelling up to 3 billion yuan ($483
million) to doctors and officials to encourage them to use its
medicines in a case that rocked the pharmaceuticals industry.
GSK sales in China, where the company has a staff of around
7,000, plunged in the wake of the scandal and it has recently
dismissed some employees in the country and withheld bonuses
from others as it seeks to root out wrongdoing.
While a number of major drugmakers have faced investigations
into their overseas practices under the U.S. Foreign Corrupt
Practices Act (FCPA), GSK's problems in China have been unusual
in being spearheaded by local Chinese officials.
GSK has previously described the Chinese corruption
allegations as "shameful" and the company recently took steps to
tighten procedures, including a move to stop the practice of
paying doctors to speak on its behalf.
The latest allegations concerning Iraq were first reported
by the Wall Street Journal, which said it had reviewed emails
from a person familiar with GSK's Middle East operations citing
alleged corrupt practices in Iraq, including continuing issues
and alleged misconduct dating from last year and 2012.
One of the emails said the malpractices appeared to violate
both the FCPA and the British Bribery Act, both of which
prohibit bribery of foreign officials.
GSK said that operating in emerging markets was
"challenging", given the issues that many countries face in
funding their healthcare systems, but the spokesman said the
firm remained committed to providing medicines in multiple
Building up business in developing economies is an important
plank of GSK's growth strategy and Chief Executive Andrew Witty
has described himself as an "extreme bull" on emerging market
Last week, the drugmaker announced plans to invest up to 130
million pounds ($216 million) in Africa. It has also recently
built up stakes in local operations in India and Indonesia.
($1 = 0.6028 British Pounds)
(Editing by Eric Walsh)
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