What’s new: Chinese graft busters are investigating Zhou Bin, former deputy general manager of state-owned drugmaker China National Pharmaceutical Group Co. Ltd. (Sinopharm), as Beijing continues its crackdown on health care corruption launched last year.
Zhou is suspected of “serious violations of (Communist Party) discipline and law,” a common euphemism for corruption, according to a brief statement published Wednesday by the Central Commission for Discipline Inspection, the party’s top graft watchdog.
Zhou most recently served as chairman and party chief of Shanghai Shyndec Pharmaceutical Co. Ltd. (600420.SH), a subsidiary of Sinopharm.
The background: The graft probe comes six months after Zhou resigned from all positions at Shanghai Shyndec, citing “personal reasons” in a June stock exchange filing.
The resignation sparked investor speculation, as he had not reached the usual retirement age and had been re-elected as chairman only months earlier.
Shanghai Shyndec’s sales expenses were high during Zhou’s tenure, peaking at 3.61 billion yuan ($508.6 million) in 2019, accounting for nearly 60% of operating costs that year, according to the company’s past earnings reports.
Sales costs of Chinese drugmakers have become a key target in the latest year-long crackdown on corruption in the health care sector, which was launched in July and has so far ensnared more than 200 hospital chiefs nationwide, according to China Fund News.
Contact reporter Wang Xintong (xintongwang@caixin.com) and editor Jonathan Breen (jonathanbreen@caixin.com)
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