[Ip-health] Wall Street Journal: Glaxo Settles With U.S. for $3 Billion

thiru at keionline.org thiru at keionline.org
Thu Nov 3 02:44:17 PDT 2011


http://online.wsj.com/article/SB10001424052970203804204577015234100584756.html?mod=googlenews_wsj

    HEALTH INDUSTRY
    NOVEMBER 3, 2011, 4:21 A.M. ET

Glaxo Settles With U.S. for $3 Billion

By STEN STOVALL

LONDON—Britain's biggest drug maker GlaxoSmithKline PLC said Thursday that
it had agreed to settle its most significant disputes with the U.S.
government over the way it marketed and developed drugs, at a cost to the
company of $3 billion, which is being covered by existing provisions.

The final settlement, which is expected to address civil and criminal
liabilities, remains subject to negotiation of specific terms and is
expected to be finalized in 2012. Glaxo said the settlement of $3 billion
is covered by existing provisions and that it expects to make payments
under the final agreement in 2012 using existing cash resources.

The deal concerns continuing federal government investigations,
specifically the investigation into Glaxo's sales and marketing practices
begun by the U.S. Attorney's office of Colorado in 2004 and later taken
over by the U.S. Attorney's Office of Massachusetts. It also covers the
U.S. Department of Justice's investigation of possible inappropriate use
of the nominal price exception under the Medicaid Rebate Program, and the
Department of Justice's investigation of the development and marketing of
diabetes medicine Avandia.

"This is a significant step toward resolving difficult, long-standing
matters which do not reflect the company that we are today," Glaxo Chief
Executive Andrew Witty said. "In recent years, we have fundamentally
changed our procedures for compliance, marketing and selling in the U.S.
to ensure that we operate with high standards of integrity and that we
conduct our business openly and transparently."

"We reiterate our full commitment to ensuring appropriate promotion of our
medicines to health-care professionals and to the standards rightly
expected by the U.S. Government," Mr. Witty said.

Write to Sten Stovall at sten.stovall at dowjones.com





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