GlaxoSmithKline PLC said it will pay the U.S. $3 billion to settle federal criminal and civil investigations into whether the London-based company marketed some drugs illegally and defrauded the Medicaid program.
As The Wall Street Journal reports, the settlement will also resolve a Justice Department probe into Glaxo’s development and marketing of the diabetes drug Avandia, which has been linked to heart attack risks.
Glaxo said the final settlement still is being negotiated, but that it expected to pay the government in 2012.
The tentative deal is the latest in a string of large settlements the government has extracted from drug companies in recent years over illegal marketing practices. As the Journal pointed out, critics of the industry say the sums, while large, are dwarfed by the profits companies earned from improper marketing practices.
In a news release, Glaxo Chief Executive Officer Andrew Witty called the agreement in principle “a significant step toward resolving difficult, long-standing matters which do not reflect the company that we are today. In recent years, we have fundamentally changed our procedures for compliance, marketing and selling in the U.S.”
Glaxo said the settlement ends an eight-year-old probe into its marketing of top-selling drugs, including the antidepressants Paxil and Wellbutrin, between 1997 and 2004. The probe focused on allegations that Glaxo promoted Wellbutrin for uses not approved by the Food and Drug Administration, an illegal practice known as off-label marketing.
The Journal said investigators have also examined Glaxo’s statements about the risk of suicidal behavior for patients taking Paxil, according to lawyers interviewed by the investigators.
The investigation has also examined Glaxo-funded medical education and clinical trials, and the company’s hiring of doctors for various services, according to Glaxo disclosures.
Justice Department officials couldn’t be reached for comment early today.
Glaxo said the $3 billion settlement will also cover an investigation into the development and marketing of Avandia, a diabetes drug that was once one of Glaxo’s top sellers. Evidence linking Avandia to increased risks of heart attacks prompted the FDA to put tight restrictions on the drug’s use last year, and European regulators pulled Avandia from the market.
STUART SILVERSTEIN
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Eli Lilly Zyprexa Olanzapine issues linger.
PTSD treatment for Veterans found ineffective.
The use of powerful antipsychotic drugs has increased in children as young as three years old. Weight gain, increases in triglyceride levels and associated risks for diabetes and cardiovascular disease. The average weight gain (adults) over the 12 week study period was the highest for Zyprexa—17 pounds. You’d be hard pressed to gain that kind of weight sport-eating your way through the holidays.One in 145 adults died in clinical trials of those taking the antipsychotic drug Zyprexa.
This was Lilly’s # 1 product over $ 4 billion per year sales,moreover Lilly also make billions on drugs that treat the diabetes often that has been caused by the zyprexa!
— Daniel Haszard Zyprexa victim activist and patient.
zyprexa-victims(dot)com