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Sanjing Pharma chief leaps to his death amid corruption probe

Liu Zhanbin was chairman and chief executive of the Harbin Pharmaceutical Group subsidiary
China

The head of a Chinese company under investigation for corruption has leaped to his death from a hospital window.

Liu Zhanbin - the chairman and chief executive of Harbin Pharmaceutical Group 's 75 per cent-owned Sanjing Pharmaceutical Co subsidiary - was admitted to hospital in the city of Heihe near the Russian border on Sunday (May 18) complaining of gastric discomfort.

Later that day he evaded guards and jumped from a third-floor bathroom window, according to a statement issued by Sanjing to the Shanghai Stock Exchange.

Liu had been placed under investigation by the procurator of Heihe last Friday on suspicion of corruption, according to the state-owned Xinhua news agency, which indicated that he had addressed investors at the company's general meeting a day earlier.

He was attending hospital under direct supervision of court-appointed guards, according to the news wire. Additional details of the investigation have not yet emerged.

Sanjing's president Liu Chunfeng will take over interim chairman of the pharma company, which insisted its business would not be materially affected by the tragedy.

Last week, China's Ministry of Public Security (MPS) made its first public statement on the long-running investigation into corrupt practices and medicine pricing in the pharmaceutical industry, which has entangled a number of multinational and domestic drugmakers including most notably GlaxoSmithKline.

Other Chinese companies that have been linked to the investigation in the past include Sinopharm and Shanghai Pharmaceutical, as the government tries to put a lid on healthcare expenditure that grew more than 13 per cent to $516bn last year and is threatening to bubble over at the same time as the country's economic growth is cooling down.

China's clampdown on corruption is not just focusing on the country's $87bn pharmaceutical market but appears to be gaining pace in that sector, with the dossier against GSK now in the hands of public prosecutors.

The country has been pushing through a raft of healthcare reforms since 2009 which along with a move towards universal public healthcare provision include improved regulation of the pharmaceutical supply chain and a crackdown on illegal activities to prevent drug price increases.

20th May 2014

From: Regulatory

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