Document summary
Using Transparency International methodology, European large pharma shows the widest discrepancy between good anti-corruption reporting and poor practice. The variation of final risk exposure scores between companies remains in a comparatively poor-scoring and narrow range, and the entire sector remains exposed.
Regulators take a special interest in bribery in their domestic countries when their own budget deficits are at stake. Following the US, we now see China at the start of a systematic enforcement of anti-corruption rules to control pricing. Whether through price fixing concerns, large product recalls or corruption, foreign companies are increasingly affected.
Knock-on impacts under US, UK and other geographical legislation from probes carried out in China are possible. The risk may be increased for companies like GSK and Novartis currently under a 'corporate integrity agreement' contract as a result of prior settlements with US authorities for similar offences. Lobbying, in particular, is a growing long-term shareholder risk due to greater government, media and civil society focus.