Now Sanofi is tangled up in trouble in China. The last few days have brought news of a wide-ranging investigation into payments to hospitals and medical workers, similar to what GlaxoSmithKline has been accused of.
And I don't have much reason to doubt either story, because (as this BBC story details) payments of this sort are rife. I would also note that, according to the AP, the Chinese government "is investigating production costs at 60 Chinese and foreign pharmaceutical manufacturers, according to state media, possible as a prelude to revising state-imposed price caps on key medications."
A system where everyone is in violation of the law has a lot of advantages - if you're the government. Retribution, when it's needed, is always at hand, because all you have to do is threaten to enforce what's already on the books. And lest someone think that I'm just beating away at the Chinese situation, the same applies to the US (on what I hope is a lower level). Here's economist Tyler Cowen, from the Marginal Revolution blog, on that very subject:
Faced with the evidence of an non-intentional crime, most prosecutors, of course, would use their discretion and not threaten imprisonment. Evidence and discretion, however, are precisely the point. Today, no one is innocent and thus our freedom is maintained only by the high cost of evidence and the prosecutor’s discretion.
The GSK and Sanofi allegations are, of course, all about intentional acts. But prosecuting them is very much up to the discretion of the Chinese authorities. If they're trying to root out corruption in their health care system, more power to them, because that's a worthy cause. But if they're just putting the squeeze on people long enough to bargain with them, only to let things return to the status quo ante after concessions have been extracted, then I have another opinion. Cynically, that's just what I expect to happen. After all, one might need to charge these companies with bribery again at some point. The Chinese authorities - authorities in general, all over the world - are not in the habit of putting down useful weapons and walking away from them.