GlaxoSmithKline’s $490 million fine to spark pharma strategy shift in emerging markets, says analyst

UK pharma giant GlaxoSmithKline’s (LSE: GSK) involvement in a large-scale bribery scandal in China came to an expected conclusion last week, with Chinese authorities issuing a  sizeable fine of $490 million, says Aparna Krishnan, GlobalData’s analyst covering health care industry dynamics.

The scandal and its repercussions will be felt deep into Big Pharma’s operations in emerging markets, causing a fundamental shift in product marketing approaches involving physicians, she noted.

Ms Krishnan continued: “In the immediate aftermath, the fine is expected to be reflected in GSK’s third quarter financial results as a one-time cost component draining its net income. Associated costs to improve marketing and sales standards in countries such as India, China and Brazil will also add to the company’s selling, general and administrative costs for the quarter.”