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Beijing teams investigate Sanofi for alleged bribery

BEIJING city corruption and health officials have launched an investigation into allegations that staff at French pharmaceutical giant Sanofi paid bribes totaling some US$280,000 to 500 Chinese doctors.

The joint investigation will probe claims reported in China’s 21st Century Business Herald newspaper that company staff paid 503 doctors in 79 hospitals bribes totaling 1.69 million yuan in a bid to increase sales.

The paper, citing documents provided by an anonymous whistleblower, said Thursday that in 2007 Sanofi paid doctors 80 yuan every time a patient bought its products, with the largest payment being 11,200 yuan.

The products named in the report are two drugs for high blood pressure.

Most payments were made to medical staff in hospitals in Beijing, Shanghai, Guangzhou, capital of southern Guangdong Province, and Hangzhou, capital of eastern Zhejiang Province, said the newspaper

The report claimed these were listed as “research expenses.”

The Beijing municipal health bureau will coordinate with the disciplinary authorities to investigate, a spokesman told Xinhua News Agency yesterday.

Define the boundary

How to define the boundary between a “research expense” and bribery is key to the case, industry insiders said.

Investigators will seek to find out whether clinical research programs had lists of patient names and medical reports, said a Beijing health bureau official.

On Friday, Guangdong Province health bureau summoned the heads of 16 hospitals named in the report, vowing to carry out a thorough investigation.

Sanofi said that it took the allegations “very seriously” and has begun relevant procedures to investigate the allegations.

“We have zero tolerance to any unethical practice,” it said.

Sanofi added that it has “processes for reviewing and addressing such issues in a manner that is consistent with our legal and ethical obligations.”

The allegations come after four executives from British drug firm GlaxoSmithKline were arrested last month for alleged bribery and other offences.

China’s top economic planner is investigating 60 foreign and domestic pharmaceutical companies over their prices.

UN official sees Chinese economic growth ‘stable’

President of the United Nations General Assembly Vuk Jeremic said Friday that the Chinese economy is one of the strongest performers worldwide and offers optimism to the world economy.

Jeremic, president of the 67th session of the UN General Assembly, made the comments in a joint interview with Chinese media in Beijing.

He said one of the most significant reference points to the world economy is China’s economic situation. If China is going in the right direction, the rest of the world will be going in a good direction economically. If China is having difficulties, everybody is going to have difficulties.

In the first half of the year, China’s economic growth slowed to 7.6 percent.

“The growth, which some people question that whether this is good enough or strong enough… I don’t really think that there are too many countries in the world that can have 7.6-percent growth, a very stable one,” he said.

“I understand that of the 7.6-percent growth rate, 7.5 percent can be attributed to domestic demand, so we are talking about really ‘solid’ growth, perhaps not 10 percent like China used to have,” he added.

Jeremic praised China for showing the strength and resilience in the face of international challenges.

As to the global political and economic landscape, he believed the UN remained key to resolve the challenges in the 21st century by engaging everyone equally in the General Assembly. Although important organizations like the G20 are emerging, without the UN and UN General Assembly, there is no chance to resolve challenges in a satisfactory manner, he said.

The role of the emerging markets and developing countries will become stronger and the most significant element in this new geopolitical puzzle and the new landscape, as part of the wider global development, he noted.

The Millennium Development Goals will expire in 2015 and they need to be replaced by a new vision for world development for the next 20 to 30 years, he said.

World leaders at the Rio+20 conference in June 2012, agreed for the General Assembly to draft a development agenda for the 21st century. Over the next 24 months, the assembly will need to complete negotiations, achieve a consensus so the world will develop in a sustainable way, not exacerbate social differences and tensions in a country and between countries, and make the gap between the rich and poor smaller.

Jeremic said China plays a critical role in this process and looks forward to working with the country, hoping it will continue to play a constructive role in the UN.

Jeremic will be replaced by John William Ashe, ambassador to the UN for Antigua and Barbuda, for the 68th session in September.

Pharm giant says it takes bribery claims ‘seriously’

Allegations by a whistle-blower that French pharmaceutical giant Sanofi-Aventis bribed more than 500 doctors in China in late 2007 to boost its sales are being taken “very seriously” by the company.

An anonymous whistle-blower on Thursday told the 21st Century Business Herald newspaper that Sanofi staff paid about 1.69 million yuan ($276,000) in bribes to 503 doctors at 79 hospitals in Beijing, Shanghai, Hangzhou and Guangzhou in November 2007. The company also allegedly bribed 43 doctors at five hospitals in Beijing in the form of cash payments and gifts each month from May to October in 2007.

The allegations come after four Chinese executives from British drug firm GlaxoSmithKline were detained last month for suspected bribery and tax-related violations. China’s top economic planner is currently investigating 60 foreign and domestic pharmaceutical companies over their prices.

British drugmaker AstraZeneca and Belgian drugmaker UCB recently admitted they are being investigated by Chinese authorities.

The 21st Century Business Herald, based in Guangzhou, Guangdong province, surmised that the whistle-blower worked in Sanofi-Aventi’s upper management in China based on the nature of the content provided to the publication.

The whistle-blower said the bribes were given in the name of research spending and would only give the name “Pei Gen” to the newspaper.

“Sanofi is confident in our business operations in China and committed to conducting its business globally with integrity. We are determined to respect the ethical principles governing our activities and are committed to abiding by the laws and regulations that apply in each country where we operate. We have zero tolerance to any unethical practice,” the company said. “At this time, it would be premature to comment on events that may have occurred in 2007.”

The National Health and Family Planning Commission recently passed a plan to fight what it called inappropriate behavior in selling medicine. Li Bin, head of the commission, stressed in July that medical reform is needed to combat bribery in an industry where many Chinese hospitals rely on the sale of medicine.

Currently, the central government sets a pricing standard for medical services provided by public hospitals. Many experts believe the policy keeps the price of services at an artificially low level and puts pressure on hospitals and doctors to sell more medicine and possibly accept bribes.

In 2012, Beijing introduced new regulations on public hospitals to emphasize quality medical services and discourage hospitals and doctors from relying on the number of prescriptions they dole out.

As part of the reform, some hospitals are required to sell medicine at cost, but they are allowed to charge 42 yuan to 100 yuan in consultation fees (health insurance companies are required to reimburse the 40 yuan to the patient). Before the reforms, a consultation would cost between 5 yuan to 14 yuan.

But Niu Zhengqian, deputy director of the Chinese Pharmaceutical Enterprises Association, said the key to preventing doctors from excessively prescribing medicine lies in changing the way the healthcare insurance industry pays hospitals.
“Currently the public healthcare insurance sector pays hospitals based on each item of the service they provide, encouraging them to choose more expensive items, from which doctors can get more illegal kickbacks,” Niu said.

An advanced payment system is also effective, said Wang Hongzhi, a healthcare industry consultant. With this plan, a local government healthcare agency pays a hospital a specified amount of money to cover healthcare fees. If there is a surplus, the hospital pockets it; if there is a deficit, it must share the costs with the local agency.

“If the market is more competitive and there are more private healthcare providers, that will also help solve problems in the industry,” Niu said.

Tough job market for over three million college students: official

A dismal job prospect is expected to unfold itself for China’s numerous college graduates, as over three million college students could fail to land a job this year, some official estimated in a press conference yesterday.

The figure was revealed by Wang Yujun, a senior official of the Ministry of Human Resources and Social Security, in the media briefing for the annual report of the reform and development of China’s social security.

Against the backdrop of a record high number of graduates nearing seven million this year, more than three million college students could probably not find a job before graduation, said Wang.

She claimed that the estimation is made by taking into account of the initial employment rate which exceeds 70 percent in previous years.

The initial employment rate refers to the percentage of graduates who have secured a job before leaving the campus, which also encompasses those who have enrolled as post-graduates or by a foreign university.

The employment difficulty is caused not only by the nation’s education mode and students’ career vision, but also the quantity and quality of the job vacancies at present, Wang added. She predicted that the situation can hardly get better in a few years to come.

Sanofi cuts 2013 goal, authorities visit China office

* Sees FY earnings down 7-10 pct at constant currencies
* Says one office visited by authorities in China
* Says not aware of visit purpose
* Q2 business net income down 23.4 pct to 1.48 bln eur
* Shares down 6.2 percent (Adds details, CEO comments, background)

By Elena Berton

PARIS, Aug 1 (Reuters) – Sanofi SA cut its 2013 earnings forecast as it reported a steeper-than-expected drop in second-quarter profit, hit by the effect of patent losses, currency fluctuations and an inventory setback in Brazil.

The French company also said one of its 11 regional offices in China had been visited by the State Administration for Industry and Commerce (SAIC (NYSE: SAI – news) ) in Shenyang, but added it was not aware of the purpose of the visit from the agency.

A probe by Chinese authorities into the activities of GlaxoSmithKline (Other OTC: GLAXF – news) led to allegations of a wide-reaching bribery scandal last month and prompted speculation that other international companies could be drawn into the investigation.

“We are not really aware of the purpose of the visit, we are working with,” Chief Executive Chris Viehbacher told reporters on Thursday. SAIC is one of China’s anti-trust regulators in charge of market supervision, which also looks into low-level bribery cases.

Viehbacher added that the French group’s local head office in Shanghai had not been contacted by Chinese authorities.
China’s 21st Century Business Herald earlier reported Sanofi (NasdaqGM: GCVRZ – news) and U.S. drugmaker Eli Lilly & Co had confirmed visits to their offices by the Shenyang bureau of the SAIC.

Sanofi said in an emailed statement to Reuters that the agency visited its offices on July 29, but said the purpose of the visit was unclear.

Eli Lilly said in a statement to the newspaper that the visit was a routine inspection by the relevant government departments that occurred in early 2013, and was completely different to previous industry investigations led by the public security bureau.

“Regarding this inspection, we have fully cooperated,” the U.S. group told the paper. Lilly representatives in China did not respond immediately to a request for comment from Reuters.

China remains a priority market for Western drug makers, which can command hefty price premiums for their medicines even though they are no longer protected by patents.

TOO EARLY

A promise this week by GlaxoSmithKline to make its drugs more affordable in China in the wake of the bribery scandal could be a lever for Chinese authorities to start redressing the balance.

Viehbacher said it was premature to say what repercussions the scandal would have on Sanofi’s business in China.

“We are examining the issue closely and we are examining our business in China, but I think it’s too early to draw any conclusions,” he said.

Sanofi also predicted earnings this year would be between 7 and 10 percent lower than in 2012 at constant exchange rates, but said it continued to expect to return to growth in the second half of 2013.

Sanofi had previously forecast that annual profit would be flat to 5 percent lower at constant currencies.

Its shares were down 6.2 percent at 75.13 euros by 0758 GMT, the biggest losers in the CAC 40 (Paris: ^FCHI – news) index in Paris which was up 0.3 percent.

“Whilst this is disappointing, the one-time nature of most of the areas of weakness now creates even easier comparatives for the growth rebound expected in the second half of 2013 and beyond,” analysts at brokerage Jefferies said in a note to clients.

The group’s closely watched business net income, which excludes items such as amortisation and legal costs, declined 23.4 percent to 1.48 billion euros ($1.96 billion), below an average of 1.79 billion in a Thomson Reuters I/B/E/S poll of nine analysts.

Sales shrunk 9.8 percent to 8 billion as last year’s patent expiry on anti-clotting drug Plavix, once the world’s second-best selling prescription drug, sliced 481 million euros off revenue in the quarter.

The group’s generics business in Brazil was hit by much higher-than-planned inventory levels during the second quarter, Sanofi said.

As a result, Sanofi had to adjust sales by 122 million euros and book an additional provision of 79 million to write off the inventory and other related costs. ($1 = 0.7531 euros) ($1 = 6.1289 Chinese yuan) (Additional reporting by Michael Martina in Beijing; Editing by Christian Plumb and David Holmes)

Job opportunities in China at lowest level since 2010

Employers in China are decreasing their expected hiring, shows a recent report by the recruitment firm Hudson. They estimate an index, measured through interviews with employers, that tracks the expected hiring for the next quarter.

The figures for the third quarter of 2013 are reported as the lowest since the beginning of 2010.

Fewer jobs and more applicants

Bi Lin, joint general manager for Hudson in Shanghai explains the reasons he sees for such a reduction. In an interview with China Daily he says, “The government’s support of quality growth has resulted in a slower rate of growth, as many organizations are focusing on achieving internal efficiency and productivity gains in the first instance rather than adding headcount.” Of the 816 companies interviewed by Hudson, 13.2% said they would reduce their headcount in the next quarter. This is a 6.2% rise over the previous quarter.

The problem for job applicants is twofold. Along with the predictions from Hudson of declining recruitment, there are also a rising number of applicants for positions. This is blamed on several factors, including the closing of a number of export-focused companies amidst economic difficulties globally, and also an increase in the number of Chinese currently overseas returning to China due to the same economic difficulties.

Differences across the sectors

The hiring and job situation is quite mixed amongst the different sectors of the market. The Hudson report identifies stronger hiring intentions for highly qualified and specialized workers, in particular those in research and development, chemicals, healthcare, laboratory roles, and digital marketing.

The property and construction sector is seen as the industry with the most opportunity, with strong growth in hiring. This is due to the continued strength of commercial and retail property, with a strong domestic demand unaffected by overseas economic difficulties or tightening regulations for overseas capital in China.

Healthcare, too, has strong potential. 71.2% of respondents in this sector indicated increased hiring intentions for the next quarter. Bi explained that this is due to the upcoming plans of a number of global pharmaceutical companies currently establishing research and development centers in China increasing their demand for employees.

6 Job-Hunting Tips for the Employed

People aren’t waiting until they are unemployed to start looking for their next opportunities. New research has found that 73% of employees say they are comfortable searching for a job while they still have one.

However, those respondents are not only looking for a new job while employed: they’re searching while they’re working. Respondents say they would be comfortable looking for jobs online, exchanging emails, taking calls and submitting applications while they are at their current places of employment.

While the majority of respondents say they would job-hunt while at their place of work, 26% of respondents say they are uncomfortable looking for another job while they are still employed.

SEE ALSO: 50+ Job Skills You Should List on Your Resume

The researchers found a distinct breakdown by age when it comes to comfort in looking for a new job. Workers between the ages of 18 and 34 were most likely to conduct job search-related tasks at their current job. Overall, 48% of workers in that age range say they are comfortable looking for a job at work. Just more than one-quarter of workers between ages 35 and 44 say they are comfortable looking for a new job at their office. Of workers 55 and older, 21% say they would be comfortable looking for a new job while at the office. The research was based on the responses of 427 workers.

“The grass isn’t always greener on the other side, so professionals should first consider how they might improve their current situation before looking for a new job,” said Max Messmer, chairman of Accountemps and author of Human Resources Kit For Dummies (John Wiley & Sons Inc. 2012). “When it is time to move on, conducting the job hunt using company resources is not only unethical, it places the employee at a high risk of being caught in the act.”

SEE ALSO: 11 Resume Myths Busted: Realities Revealed

To help workers who may be looking for a new job while employed, Accountemps offers the following tips.

1. Look at internal openings first. If you’ve outgrown your current role but are happy with your work environment, see if there are relevant openings within your company before looking elsewhere. When it comes to filling vacancies, many employers prefer internal candidates.

2. Keep it to yourself. If you want to keep your job search a secret, don’t mention it to anyone at work. Even the most trustworthy co-worker could inadvertently spill the beans. It’s best to stay mum until you announce your resignation.

3. Play it safe online. Be careful when visiting job boards or using social media to conduct your search. A single status update could be enough to alert your employer. You can further minimize the risk of being caught by ensuring your privacy settings are tight and using services that mask your identity when posting your résumé online.

4. Be upfront with potential employers. Most hiring managers understand that you will need to make arrangements to communicate or meet outside of office hours. Schedule interviews before or after work or during your lunch break.

5. Focus on the details. If you work in a casual environment where jeans and sneakers are the norm, showing up in a suit following a job interview could reveal your intentions. Bring a change of clothes so nothing seems amiss.

6. Partner with a recruiter. A professional recruitment agency is often your best bet when it comes to conducting a discreet job search. A recruiter can confidentially distribute your résumé and identify relevant employment opportunities on your behalf.

Specialized newsrooms abuzz on WeChat

Social media cater to public demand for concise, customized information

Lu Jiuping starts working at 4 am every day, but the retired 50-year-old businessman has never made a cent from his current occupation.

He starts his day by reading several financial websites, picking out valuable bits of business or IT news.

Not satisfied to digest the information alone, he posts these news items on “Tearoom 90”, an official account he registered on WeChat, a popular mobile social networking platform developed by Chinese IT giant Tencent.

Since it was set up in February, Lu’s free subscriber service has attracted a readership of more than 14,000, quickly turning it from a “tearoom” to a “newsroom”, much to the delight of the amateur media strategist.

“I am working as the chief editor of an e-magazine,” Lu said.

The Official Account is one built-in WeChat function that offers broadcast messaging. Operators of each account can share anything in any format with their subscribers and receive instant feedback.

According to Tencent’s website, the platform was originally created for big brands, such as airlines, banks and celebrities, but it has unexpectedly struck a chord with the public and citizen reporters, like Lu, who are taking advantage of the platform to develop specialized storytelling styles.

In the past few years, Sina Weibo, China’s most popular Twitter-like service, has exploded in popularity. Millions of Weibo users use the service to speak their mind.

Platforms such as Sina Weibo and WeChat are changing the way media work, with netizens now discovering and discussing social events online.

However, spam and misinformation have grabbed onto the coattails of the service, and people are getting tired of irrelevant or boring micro blogs that pop up on their screens all day.

Lyu Xin, dean of the New Media Department of Animation and Digital Arts School at Communication University of China, described this as the “parabola” of social media development.

He said that the rise of micro-blogging inspired people from all walks of life to voice their opinions on social issues, breaking down traditional media’s long-held domination over the spread of information and speeding up information transmission.

As they become increasingly immersed in social media, however, users find that it gets “boring” to sift through massive amounts of irrelevant information to find news that interests them. Instead, they prefer to spend their time perusing concise and well-organized information delivered to them directly.

“The parabola has reached its peak, and it will go down,” said Lyu, “but people’s demand for social media will go up.”

The professor attributed the popularity of WeChat to the platform’s ability to push content that meets public demand.

“In the social media age, no dish suits all tastes. People need more information to serve their personal interests. The Official Account on WeChat provides a venue for both institutions and individuals to publish their personal information,” one blogger wrote.

Lu’s case helps to illustrate that point.

He describes his “Tearoom 90” as a professional business magazine. “My target customers are industry insiders, and those gossip girls or boys have little interest in following.”

The customized information helps to attract people with shared interests to subscribe, but subscriber-only content, which only subscribers can read or comment on, could be used to broadcast false information.

Many national newspapers, magazines and websites have also landed in the platform.

In April, China Central Television, a State-owned broadcaster, launched its official WeChat account “CCTV News” to spread news reports and photos, as well as receive reader comments.

Government departments have also opened accounts for hearing opinions from the public. According to a report released in May by Tsinghua University, the number of government accounts on WeChat has reached 1,000 across China.

Spending linked to social security

Many people were surprised to find that China’s average individual savings had reached 77,623 yuan ($12,645). But no matter how high or low the figure is, Chinese people are not likely to exchange happiness for consumption, says an article in Beijing Morning Post. Excerpts:

The announcement of the national average individual savings data could be demoralizing for people who don’t have that sort of savings. In fact, many netizens have made fun of the latest savings data by saying that they will try to catch up with the national average by surviving without food and drinks.

The average savings rate may not mean much in times of wide differences in consumption, financing, investment and earnings, especially when depositing money in banks has become the least lucrative means of wealth management.

As a country that tops the global savings rate, China has a huge number of people who are reluctant to spend more and thus boost domestic consumption to help the country’s economic growth. If savings is only about mere accumulation of money in banks, wealth management will not help national economic development.

Chinese people will really feel happy when they have enough in bank deposits even after spending more than usual, which means they should have enough cash in hand or bank to deal with emergencies, such as paying for housing, medical care and their children’s education.

Therefore, only if the government increases its input in social security will Chinese people spend more instead of depositing their money in banks.

Jobless graduates may exceed 3 million

Over 3 million graduates in China are struggling to find jobs this year, according to a report on China’s social security, released on Sunday.

With nearly 7 million graduates this year, and adding on the unemployed students from previous years, the number of graduates struggling to find jobs before leaving school is estimated to have reached over 3 million, said Wang Yujun, from the Ministry of Human Resources and Social Security, at a press conference for the “2012 China Social Security Reform and Development Report”.

The report also said that delayed retirement is not a viable option at present, as the current conditions are insufficient.

The job market is unable to fulfill the demands of job hunters, with 30 percent of new job vacancies coming from the retired, according to Professor Deng Dasong of Wuhan University.

In China, calls are being made to delay the retirement age from 60 to 65, as the aging population continues to grow rapidly.