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GlaxoSmithKline confirms China sex tape exists GlaxoSmithKline confirms existence of sex tape of former China boss
(about 3 hours later)
GlaxoSmithKline has confirmed the existence of an intimate video recording of its former China head, Mark Reilly, the Sunday Times says prompted a bribery investigation that has damaged the drugmaker's business in the country. GlaxoSmithKline has confirmed the existence of a covert sex tape of its former China boss, the latest chapter in a lurid bribery saga in China that continues to rock the pharmaceutical giant.
The newspaper said the recording was shot without Reilly's knowledge or consent at his Shanghai flat and showed the Briton, who is separated from his wife, with his Chinese girlfriend. The secretly filmed video of Mark Reilly and his girlfriend at his Shanghai apartment was emailed to 13 GSK executives in March 2013, including the chief executive, Andrew Witty.
It was not clear who shot the video, or the motivation behind it. The video was emailed to top GSK executives in March 2013, the newspaper said. Accompanying the footage were detailed allegations of sales and marketing practices described as "pervasive corruption" by an anonymous writer, "gskwhistleblower", according to a report in the Sunday Times, which first revealed the existence of the video at the weekend.
A GSK spokesman confirmed the tape existed but did not comment on how it related to the bribery allegations. Reilly is accused by Chinese authorities of running "a massive bribery network" and faces a possible jail sentence. He remains a GSK employee, although he stood down as head of China operations last July when the scandal first emerged. His current whereabouts is not known and his lawyer has declined to comment.
In July 2013, Chinese police accused Britain's biggest drugmaker of transferring as much as 3bn yuan (£283m) through travel agencies to bribe doctors and officials. When the sex video arrived, GSK hired a British corporate investigator, Peter Humphrey, to find out who broke into Reilly's apartment, according to the Sunday Times. But Humphrey was not told about the bribery allegations made by the self-styled whistleblower until two months after he began his investigations.
Reuters was not independently able to verify the link between the tape and the bribery case. In July last year Humphrey and his wife and business partner, American citizen Yu Yingzeng, were arrested by Chinese police over charges that they had illegally bought and sold personal data of Chinese citizens.
Chinese police filed corruption charges against Reilly last month. The Briton, who has been barred from leaving China, could face decades in prison. The pair were later paraded on Chinese television in orange prison vests and handcuffs when Humphrey said he had obtained illegal information and regretted it. Speaking in Mandarin, Humphrey made no mention of GSK in the "confession" aired on state channel CCTV.
Reilly has not been reachable for comment while his lawyer has declined to talk to the media. Reilly's whereabouts are unknown. A spokesman for GSK confirmed that its China division had engaged Chinawhys, Humphrey's firm, but declined to comment further on his role.
China's investigation into GSK and its scrutiny of numerous other foreign and local drugs firms has led to some foreign pharmaceutical executives fearing they could be jailed and asking their lawyers if they should temporarily leave the country. The company said it was continuing to cooperate with the Chinese authorities: "The issues relating to our China business are very difficult and complicated," it said. "As we have said previously, the allegations that have been raised are deeply concerning to us. We have committed significant resources to find out what happened in China, including an independent legal review.
GSK, which described the bribery allegations as "shameful" when they came to light last year, said on Sunday that it was continuing to cooperate fully with Chinese authorities on the ongoing investigation. "We also continue to make fundamental changes to our business in China. We are learning lessons from this situation and we are determined to take all actions necessary as a result."
"The issues relating to our China business are very difficult and complicated," it added in a statement. The emergence of the video is yet another setback for GSK, already reeling from allegations that its sales executives had paid 3bn yuan (£285m) in bribes to encourage doctors to use its medicines. The company has described the reports as "shameful", but has always insisted there were no systemic problems. Along with Reilly, two Chinese executives, Zhang Guowei and Zhao Hongyan, also face charges of bribing doctors and hospital officials.
The bribery case has hit its sales in China, as buyers have shied away from doing business with the company and GSK itself has revamped its sales and marketing model. Since the China scandal broke, GSK has been accused of bribery in Poland, Iraq, Jordan and Lebanon, while in May the Serious Fraud Office opened a criminal investigation into GSK's China business.
Bribery allegations involving GSK have come to light since then in other countries. The drug firm is now investigating claims that bribes have been also paid to doctors in Poland, Iraq, Jordan and Lebanon.
Last month, Britain's Serious Fraud Office launched a formal criminal investigation into GSK.