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FCPA Blog Daily News

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Tuesday
Jul242018

Report: China pharma in vaccine scandal involved in multiple bribery cases

The Chinese pharmaceutical company under investigation for producing and selling ineffective children's vaccines has been involved in several recent cases of bribery, according to reports from Asia.

"Changchun Changsheng Biotechnology Co and its parent company, Changsheng Biotech, have been mentioned in at least 10 bribery-related cases in the past decade," China Daily said Monday.

The news outlet said the information came from China Judgment Online, a web-accessible database that discloses court rulings.

"The judgments in the criminal cases say the company's employees or distributors paid money to people responsible for buying vaccines, including those working in hospitals or disease control departments at the county or city level, to be given priority in vaccine purchases," China Daily said.

The pharma supplied more than 250,000 doses of ineffective DPT (diphtheria, whooping cough and tetanus) vaccines for infants and young children, Beijing-based CGTN said.

Changsheng Biotech is also China's second biggest rabies vaccine maker.

China regulators have accused the company of forging test data. Its vaccines have been pulled from the market.

The South China Morning Post said Tuesday,

According to court papers available online, company employees have been involved in a number of bribery cases in the last couple of years. In the most recent one, last week, Changsheng Bio-tech sales representative Wu Yuhai was found to have paid 164,000 yuan ($24,200) in bribes to the head of the Changling disease control center, Wang Feng, between 2010 and 2015, according to a court ruling in Shangqiu, Henan province. Wang was jailed for eight years for taking bribes and other offenses, but the document did not give a verdict on Wu.

Another report said a court in Henan province convicted a man in September, surnamed Song, who worked for a disease prevention and control center of accepting bribes of about $150,000 from several vaccine makers, including Changchun Changsheng Biotechnology.

"Song was sentenced to 18 months in prison for bribery and fined [about $30,000], the court information said."

In November, the Xiashan District People's Court in Zhanjiang (Guangdong province) sentenced a woman in charge of vaccinations at a hospital to 18 months with an 18-month reprieve for bribery after she received "illicit profits from the company's chickenpox vaccine agency," the report said.

In China, compulsory vaccines for DPT and other diseases are given to children at state-run hospitals and disease control centers.

Changsheng Biotech trades on the Shenzhen Stock Exchange. The company's 2017 annual report said it earned profits of about $83 million and spent $65 million "on promotion," China Daily said.

Chinese police reportedly detained Changsheng Biotech's chairwoman and at least three other company executives.

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Richard L. Cassin is the publisher and editor of the FCPA Blog.