The GlaxoSmithKline (NYSE:GSK) corruption investigation in China could lead to charges for executives but not the drug company itself.
Legal and industry sources told Reuters that while it is difficult to predict what Chinese authorities would do, the most likely scenario would be charges for the Chinese GSK executives. The sources declined to be named due to the sensitivity of the case.
Chinese authorities in July launched an inquiry into alleged bribery of doctors and other officials as part of an effort to boost sales of GSK drugs. GSK has said that the allegations involve individuals who work at the company and that bribery is not supported by the company.
Charges against individual executives rather than the company would be GSK’s preferred outcome. Charges against the company could result in large fines and possibly the disruption of GSK’s operations in China. The sources told Reuters that Mark Reilly, the former GSK head of China operations, is unlikely to face charges.
The Chinese inquiry into GSK’s drug is expected to conclude by the end of the month or early December.
Britain-based GSK operates its U.S. headquarters in Research Triangle Park.