GlaxoSmithKline to stop paying doctors to promote products

Move could be a first for a major drug company and could have major ramifications for the pharmaceutical industry

The headquarters of pharmaceutical company GlaxoSmithKline is pictured in west London on July 29, 2013.

GlaxoSmithKline will stop paying doctors to promote its products, the pharmaceutical giant's chief executive said Monday, in a move that could be a first for a major drug company.

In an interview with the New York Times, Andrew Witty framed the change as an effort to "try and make sure we stay in step with how the world is changing” rather than a reaction to any criticism of the industry's perceived aggressive marketing.

As part of  the change in policy, Glaxo will also stop tying compensation of sales representatives to the number of prescriptions doctors write, the Times said.

U.K.-based Glaxo is one of the world’s largest pharmaceutical companies, with sales in the last quarter topping $10 billion.

According to a database of disclosures of pharmaceutical companies by ProPublica, the U.S. investigative journalism non-profit, Glaxo paid out nearly $240 million dollars to doctors to promote their products between April 2009 and Sept. 2012. According to the firm’s own disclosure for 2013, it paid approximately $8.5 million to physicians for the promotional services between Jan. 1 2013 and Sept. 30 2013.

Glaxo could not be reached for comment by Al Jazeera regarding its new policy.

But the company's decision comes as it faces allegations of illegal payments to Chinese doctors and officials. Chinese police have accused the company of funneling up to $494 million to travel agencies to facilitate bribes – all in an effort to boost its drug sales. The accusations are the most serious against a multinational in China in years.

However, in the New York Times interview Witty said that the proposed changes were unrelated to the investigation in China.

“We keep asking ourselves, are there different ways, more effective ways of operating than perhaps the ways we as an industry have been operating over the last 30, 40 years?” he was quoted as saying.

Witty declined to comment to the newspaper on the Chinese investigation because he said it was still underway.

In 2012, Glaxo faced a significant legal setback in the United States, paying $3 billion in the largest healthcare fraud settlement in U.S. history.

Glaxo’s payment, the largest ever by a drug company, was due to its “unlawful promotion of certain prescription drugs, its failure to report certain safety data, and its civil liability for alleged false price reporting practices,” according to the U.S. Department of Justice.

Al Jazeera and Reuters.Tom Kutsch contributed to this report

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