BRITAIN’S largest pharmaceuticals firm has suffered a 61 per cent collapse in its sales in China, following allegations of up to 3bn yuan (£305m) in bribes paid to medical staff in the country.
Glaxosmithkline, announcing its third quarter results yesterday, said that sales in its emerging markets and Asia-Pacific region would have been up five per cent if the hit to China had not happened.
Instead, revenue in this region was down nine per cent.
Chief executive Sir Andrew Witty said that the scandal – prompted by Chinese authorities alleging that Glaxo funneled money to travel agents which then went to bribing doctors and officials – had resulted in “an anxiety which has led to some disruption in the business”.
“We have a number of products where we compete in the marketplace, I suspect it’s as simple as this,” added Witty, saying that the scandal has seen buyers switch to rival brands.
Yet other firms to have been implicated in the scandal could also see sales hit, Witty said. Sanofi, Eli Lilly and Novartis have faced allegations of bribery.
Glaxo’s global sales were broadly flat at £6.51bn in the quarter, below expectations. Yet core operating profit of £2.06bn beat expectations thanks to the company’s ongoing cost-cuts. Shares closed down 1.9 per cent at 1,570.5p.