The police in China announced on Monday that British pharmaceutical giant GlaxoSmithKline had channeled millions of dollars worth of bribes through travel agents in China to doctors and government officials.
The bribes helped GSK to increase its prices and sales of their medications in China, said authorities.
Law enforcement authorities detained four top executives at GSK. All four executives are from China.
An economic crimes unit chief said that the government of China discovered that since 2008 the British drug maker had funneled over $489 million through some 700 travel agencies. No details as to how much of that money was used for bribing doctors and officials.
Last week members of the Chinese government said that the GSK executives in China had confessed to violations of tax and bribery. However, until Monday authorities did not release any additional details of their probe.
This is one of many ongoing investigations by the government into foreign businesses and the practices they carry out regarding pricing in the second largest world economy.
No comment was given by GSK officials, but the company did state previously that they found no evidence of bribery or corruption practices amongst their staff in China.
However, the company did say it had been fully cooperating with Chinese authorities and officials from the company had only been aware of the bribery investigation since the beginning of July.
More and more China is becoming an important place for sales for pharmaceutical companies as drug makers are turning to the rapid growing emerging markets as alternatives to other countries where patent protection has been lost by some of their bestselling medications.