GSK To Settle Fraud Charges for $3 Billion

GlaxoSmithKline agreed to plead guilty to misdemeanor criminal charges and pay $3 billion to settle a healthcare fraud case involving the illegal promotion of the antidepressant Paxil to patients under 18, and Wellbutrin for unapproved indications, according to an investigation led by the U.S. Justice Department. The settlement also included charges that GSK failed to provide the FDA with safety data about its diabetes drug Avandia. The agreement, pending court approval, would resolve allegations that GSK broke U.S. laws in the marketing and development of pharmaceuticals.
 
The misconduct began in the late 1990s and continued, in the case of Avandia’s safety data, through 2007. GSK agreed to plead guilty to three misdemeanor criminal counts, one each related to the three drugs. The settlement includes $1 billion in criminal fines and $2 billion in civil fines.
 
Andrew Witty, GSK’s chief executive officer, said, “The misconduct originated in a different era for the company and will not be tolerated. “I want to express our regret and reiterate that we have learned from the mistakes that were made.”
 
As part of the settlement, the company agreed to new restrictions by the U.S. government to prevent the use of kickbacks or other prohibited practices. The inspector general of the U.S. Department of Health and Human Services will oversee the “Corporate Integrity Agreement” for five years.