Pharmaceutical giant GlaxoSmithKline plc agreed to a $3 billion settlement with the federal government, 43 states and the District of Columbia on July 2, marking the largest health care fraud settlement in U.S. history.
The settlement resolves charges that GSK engaged in various illegal schemes related to the marketing and pricing of drugs it manufactures, including antidepressants Paxil and Wellbutrin and the diabetes drug Avandia.
GSK, which is based in London and has U.S. corporate offices in Philadelphia and North Carolina”™s “Research Triangle,” agreed to pay a total of $2 billion in damages and civil penalties and $1 billion in criminal fines and to plead guilty to federal criminal charges for misconduct related to drug labeling and U.S. Food and Drug Administration reporting.
As part of the settlement, New York state will receive $146 million and Connecticut will receive $11.1 million.
The U.S. Justice Department and state attorneys general charged that GSK unlawfully marketed several of its drugs for uses not approved by the FDA, made false representations regarding the safety and efficacy of certain drugs, offered kickbacks to medical professionals and underpaid rebates owed to government programs for various drugs paid for by Medicaid and other federally-funded health care programs.
The final settlement was reached in principle last November, GSK said in a statement. The investigation was initiated in 2004 by the U.S. Attorney”™s office in Colorado.
“Today brings to resolution difficult, long-standing matters for GSK,” GSK CEO Sir Andrew Witty said in a prepared statement. “Whilst these originate in a different era for the company, they cannot and will not be ignored. On behalf of GSK, I want to express our regret and reiterate that we have learnt from the mistakes that were made.”
New York State Attorney General Eric Schneiderman in a statement called GSK”™s actions “breathtaking in (their) scale and scope.” He applauded the settlement, saying that GSK “will now be held accountable for putting corporate profits ahead of the safety of the public.”
