GlaxoSmithKline Investigator Caught Up in China Bribery Scandal Released From Prison Early

GlaxoSmithKline Investigator Caught Up in China Bribery Scandal Released From Prison Early
June 10, 2015
By Mark Terry, Breaking News Staff

One of the key players in last year’s convoluted GlaxoSmithKline bribery scandal has been released from prison early.

A British investigator, Peter Humphrey, and his American wife, Yu Yingzeng, were sentenced in August 2014 for illegally acquiring private records of Chinese citizens and selling the information to GSK and other clients.

On Sept. 19, 2014, the Changsha Intermediate People’s Court fined almost $500 million on bribery. It also sentenced Mark Reilly, formerly GSK’s China general manager, and four other company managers, to prison terms that could last up to four years. Those sentences were suspended. Reilly was immediately deported.

A sex tape of Reilly and his girlfriend was sent to GSK. Reilly then hired Peter Humphrey to find out who planted the camera in his apartment. Reilly was subsequently arrested and confessed on Chinese TV. There have been allegations that both Reilly and Humphrey might have been set up by rogue officers in China’s law enforcement and security programs.

Humphrey was released on the basis of health issues after serving about two-and-a-half years in prison. Chinese authorities also accused GSK of bribing Chinese doctors to buy their products to the tune of £312 million.

Humphrey is currently in a hospital in Shanghai undergoing tests related to cancer. Once discharged, he will be deported. His wife, Yu Yingzeng, is still incarcerated, but is expected to be released on July 11, and will be allowed to remain in China.

The couple’s trial was conducted in secrecy, except for a state television appearance in handcuffs and orange prison vests. The trial lasted one day and did not allow any foreign media. No connection was made between the GSK investigation and the charges against Humphrey and Yu.

Humphrey was formerly a journalist for Reuters and a longtime resident of China. In 2003 he and his wife set up ChinaWhys, a consultancy to investigate fraud and due diligence for international companies. The British consulate is processing an emergency passport.

ChinaWhys describes itself as an international risk assessment advisory firm. Its services include prevention investigations, troubleshooting investigations, financial consulting and internal auditing. The firm is well known among executives\ in China and the case was being watched closely by the industry and media.

In a statement made from prison to China Central Television, Humphrey said that had he known the sex video investigation was connected to GSK’s bribery allegations, he would not have taken the case.

The identity of the whistleblower who sent the sex take to GSK is still unknown. Humphrey’s investigation into the sex tape was ending when Chinese officials accused GSK officials of bribery, and within days, Humphrey and his wife were arrested.

When Will Pfizer's Breakup Happen?
Speculation that the revamping of Pfizer Inc. ’s internal business structure could happen as soon as this year has biotech wondering just when this Big Pharma company could see changes.

Last week an analyst with J.P. Morgan said he thinks there will be a much faster timeline than most of Wall Street had predicted for Pfizer’s stated mission to refocus its efforts on new medicines.

Pfizer initially announced in 2012 that it would be shedding units that were non-essential to that goal. It then promptly sold its nutrition silo to Nestle for $11.85 billion, which was rapidly accompanied by a public spin-off of its animal health business for $2.2 billion.

“While a Pfizer break-up would likely be a 2017 event, we see potential catalysts in 2015-2016," said Chris Schott, an analyst at J.P. Morgan. "Three years of audited financial statements (2014-2016) are required before any part of Pfizer can be spun off, and we also see 2017 as an attractive time for action as investors see Pfizer’s innovative pipeline clearly contributing to growth and the established business having transitioned to a more stable profile."

BioSpace wants to know what you think: Will Pfizer be a changed company by the end of 2015?

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