Danone unit investigates fresh China bribery claims

The popularity of foreign brands has grown in China after a series of milk-related scandals

A unit of the French food group Danone has started an internal investigation into bribery claims in China.

A report in Chinese newspaper 21st Century Business Herald has alleged that Nutricia, maker of Karicare milk formula, bribed doctors to boost sales.

The report, which cited an unidentified person, claimed that the unit gave gifts and travel subsidies to more than 100 doctors in 14 hospitals in Beijing.

This is the second such allegation made against a Danone unit in recent weeks.

"At the moment we still don't know the details," Zhao Qinghua, a spokeswoman for Nutricia in China, was quoted as saying by the Reuters news agency.

"We need to wait to see the outcome of the investigation before we can make our next plans."

Under scrutiny

Earlier this month a report on China Central Television alleged that Dumex, a baby food brand owned by Danone, bribed doctors to boost sales.

It was accused of giving "sponsorship fees" or payments of up to 10,000 yuan ($1,632) to hospital staff.

Dumex said it was "shocked" by the allegations and was investigating the claims.

The French food giant has also faced other problems in China this year.

Danone cut prices for its infant milk formula products by as much as 20% after China's top economic planning body fined it in August for price-fixing.

The firm also had to issue a precautionary recall of its milk formula products last month after one of its suppliers, Fonterra, said some items may have been contaminated.

Demand for foreign brands has surged in China, after tainted milk scandals in recent years led to a distrust of local producers.

According to some estimates, foreign brands now account for about half of all infant milk sales in the country.

However, foreign firms have come under scrutiny recently amid a government-led crackdown on corruption in the healthcare sector.