GSK rehires suspected China whistleblower


A GlaxoSmithKline Plc logo sits on glass windows at the company's headquarters in London, U.K., on Thursday, July 11, 2013. Glaxo is suspected of trying to increase sales channels and prices by using avenues such as travel agencies to bribe or sponsor projects of government officials, medical associations, hospitals and doctors, and faking tax receipts, China's Ministry of Public Security said on its website today. Photographer: Simon Dawson/Bloomberg©Bloomberg

GlaxoSmithKline has rehired a former senior Chinese employee who was suspected of being the whistleblower behind bribery allegations that led to a £297m fine for the UK drugmaker in China.

GSK said on Monday that Vivian Shi had rejoined the company almost three years after she was removed as the group’s head of government affairs in China.

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Ms Shi was the focus of an internal GSK investigation in 2013 that identified her as the suspected “orchestrator of a smear campaign against GSK” including a covertly filmed video of the group’s then-head of Chinese operations in bed with his girlfriend.

She was never proven to be responsible for either the video or a series of whistleblower emails detailing the bribery of doctors for which GSK was eventually found guilty by a Chinese court last year. One report in 2013 said she “flatly denied” involvement in any campaign against the company.

GSK would not say whether Ms Shi had returned to her previous job or a different role. “We can confirm we have rehired Vivian. We are not going to comment further on an individual employee.”

Her reinstatement marks another twist in a saga that has badly damaged GSK’s reputation and sales in China and prompted investigations by the UK Serious Fraud Office and the US justice department.

GSK is slowly trying to rebuild its credibility in China — one of the world’s biggest and fastest-growing pharmaceuticals markets — after issuing a public apology for its corruption.

Ms Shi was fired by GSK in December 2012 “on the grounds of alleged irregularities in her travel expenses”, according to the subsequent internal investigation into her potential role in the whistleblower emails and video.

“GSK believes Vivian orchestrated the attack but the company has no direct evidence of this,” said the report by a private investigations company, seen by the Financial Times.

The inquiry — dubbed “Project Scorpion” — was carried out by ChinaWhys, whose British founder, Peter Humphrey, and his US wife and business partner, Yu Yingzeng, were later jailed for illegally obtaining private information about Chinese citizens. They were released in June after nearly two years in prison.

GSK has always stressed the investigation into Ms Shi was commissioned by Mark Reilly, former head of its Chinese business and the subject of the covert video, rather than by its London headquarters. He left the company last year after he was found guilty of bribery and deported from China.

ChinaWhys was paid about $18,000 by GSK in 2013 to conduct “a discreet and confidential investigation into Vivian’s background, track record and political influence, as well as an assessment of the planting of the hidden camera in Dr Reilly’s apartment”. The video was assumed to have been intended to cause “irreparable damage” to Dr Reilly’s reputation.

Ms Shi was found by ChinaWhys to have “many senior government contacts” in China’s medical and pharmaceutical sectors but she did not have “any privileged access to public security organs”. The report said she was probably “capable of and responsible for the smear campaign against GSK and Dr Reilly” but acknowledged there was no hard evidence to support this conclusion. GSK said Ms Shi was not available for comment.

The group has repeatedly insisted it welcomes information from whistleblowers about corporate malpractice and has no interest in finding out their identity. It has said ChinaWhys was hired by its Chinese unit to investigate a “serious breach of privacy and security”.

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