GlaxoSmithKline, the largest pharmaceutical company in the UK, saw its China business drop by 61% after the outbreak of a bribery scandal four months ago.
GSK's China business dropped by 61% after the outbreak of a bribery scandal at the company four months ago. [File photo]
GSK released its third quarter report on October 23, revealing a 1% increase in its revenue and a 12% net loss. But the drug giant's China business -- notably its prescription medicines and vaccines -- plummeted by a dramatic 61%.
In an email sent in response to China Business News' questions, GSK CEO Sir Andrew Witty admitted for the first time that the bribery scandal has impacted the company's China business.
But the more significant impact is yet to be felt.
A medical sales representative told a China Business News reporter that many Chinese doctors now refrain from prescribing GSK drugs. The company's business centers on prescription medicines and vaccines, especially those that deal with asthma, viruses, infections, mental health, diabetes, the digestive system and cancer.
"Much of GSK's promotion in hospitals came to a halt after the public security looked into the case back in July. Its rival companies have since taken advantage and have taken the right to prescribe from GSK." the anonymous medical salesperson told China Business News.
Sales of GSK's respiratory drug Seretide have dropped by 56% and the sales of the liver medicine Hepsera have plunged by 76% in recent months, according to industry data released on Oct 24. Worse still, it is not likely to rein in the downward tendency in a short term.