### Major Share Drop for AstraZeneca Amid China Investigation

AstraZeneca shares experienced a significant decline on Tuesday, erasing £14 billion from the market value of the UK's largest pharmaceutical company. The plummet followed reports that numerous senior officials at its China branch might be implicated in an ongoing insurance fraud investigation within the country's pharmaceutical industry.

Contributing to the pressure on AstraZeneca's stock, early data on their new experimental weight loss pill was released on Monday. Analysts from Deutsche Bank described the findings as "somewhat underwhelming" and maintained a "sell" rating on the company's stock. Consequently, AstraZeneca's shares dropped over 8%, reducing its market capitalization to roughly £156 billion.

Last Wednesday, AstraZeneca disclosed that Leon Wang, its president for China and executive vice-president for international markets, was stepping aside amid an investigation by Chinese authorities. Wang is currently cooperating with these authorities, and the firm's China operations are now overseen by Michael Lai, the general manager.

Chinese media outlet Yicai reported on Tuesday that the probe had expanded to include dozens of AstraZeneca executives, involving the public security bureau, the supervisory commission, and other agencies. In response, AstraZeneca stated that it does not comment on speculative reports surrounding ongoing investigations but assured full cooperation with Chinese authorities.

The issues first surfaced in September when it was revealed that five current and former AstraZeneca staff members had been detained by Chinese police due to potential violations concerning data privacy and the import of unlicensed medications. The number of detained individuals has now increased to eight or nine, according to recent developments.

The main focus of the investigation is whether these employees were involved in importing an unapproved drug intended for liver cancer treatment and if the company had violated China's stringent patient data privacy laws. This investigation is spearheaded by police in Shenzhen, a key region in southern China.

China represents a vital market for AstraZeneca, where it has made substantial investments, including plans announced last year to build a $450 million (£350 million) factory and securing licensing agreements with local firms. Earlier this year, the company acquired Shanghai-based Gracell Biotechnologies for $1.2 billion, bolstering its portfolio in cell therapies for cancer and autoimmune diseases.

This situation mirrors events from a decade ago when AstraZeneca's competitor, GlaxoSmithKline (GSK), was fined 3 billion yuan (£297 million) for bribery by a Chinese court, underscoring the challenges foreign pharmaceutical companies face in China's tightly regulated market.