Report: Medical imaging giants thrive on bribery in China

Employees of G.E., Philips and Siemens have testified in court in China to bribing low-paid hospital officials to buy their companies’ medical devices, according to a report by the New York Times.

Western medtech makers also agreed to deals involving third-party contractors who bribed hospital workers and sought kickbacks from hospitals, even after the contractors admitted to bribery in court, the newspaper reported.

Times reporters reviewed dozens of Chinese court cases and internal corporate documents and interviewed company employees in their investigation. Bribes to China’s public hospitals and healthcare sector included a golf club membership, luxury watches and cash, the newspaper reported.

In one case, a pair of G.E. salespeople offered a $1 million bribe to a hospital administrator in so he would agree to purchase a $4 million CT scanner, according to the Times. The same administrator accepted $220,000 in cash from a G.E. sales contractor and was sentenced to 15 years in prison.

Chinese government officials usually only charge Chinese citizens with crimes in these cases, the newspaper said.

Siemens, G.E., Philips and other medtech companies told the Times that hospitals often force them to sell through a series of middlemen, where much of the bribery takes place. The companies claim to comply with Chinese and international laws and terminate employees and contractors who they learn are directly involved in wrongdoing.

“We are committed to integrity, compliance and the rule of law in every country in which we do business,” G.E. spokeswoman Tara DiJulio told the newspaper.

China imported more than $22 billion worth of medical devices in 2018, the newspaper said.