E-DRUG: Glaxo to pay $3 bn for largest health care fraud in US
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Glaxo to pay $3 bn for largest health fraud in US
By Associated Press, Tuesday, July 3, 5:38 AM
British drug maker GlaxoSmithKline will pay $3 billion in fines. The largest
health care fraud settlement in U.S. history for criminal and civil violations
involving 10 drugs that are taken by millions of people.
The Justice Department said Monday that GlaxoSmithKline PLC will plead guilty
to promoting popular antidepressants Paxil and Wellbutrin for unapproved uses.
The company also will plead guilty to failing to report to the government for
seven years some safety problems with diabetes drug Avandia, which was
restricted in the U.S. and banned in Europe after it was found in 2007 to
sharply increase the risks of heart attacks and congestive heart failure.
In addition to the fine, Glaxo agreed to resolve civil liability for promoting
Paxil, Wellbutrin, asthma drug Advair and two lesser-known drugs for unapproved
uses. The company also resolved accusations that it overcharged the
government-funded Medicaid program for some drugs, and that it paid kickbacks
to doctors to prescribe several drugs including Flovent for asthma and Valtrex
for genital herpes.
Sir Andrew Witty, Glaxo�s CEO, expressed regret Monday and said the company
has learned from the mistakes that were made.�
This is the latest in a string of settlements related to drug companies
putting profits ahead of patients. In recent years, the government has cracked
down on drug makers� tactics, which include marketing medicines for unapproved
uses. While doctors are allowed to prescribe medicines for any use, drug makers
cannot promote them in any way that is not approved by the U.S. Food and Drug
�Let me be clear, we will not tolerate health care fraud,� Deputy Attorney
General James M. Cole said Monday during a news conference at the Justice
Department in Washington.
Glaxo is scheduled to plead guilty to the criminal charges and have the
settlement approved at a hearing Thursday in U.S. District Court in Boston. In
addition to the $3 billion penalty - which includes a $1 billion criminal fine
and forfeiture and $2 billion to resolve civil claims - Glaxo agreed to be
monitored by the government for five years to ensure that it complies with
marketing and other rules.
The case against Glaxo was originally brought in January 2003 by two
whistleblowers, former Glaxo sales representatives Greg Thorpe and Blair
Hamrick. In January 2011, the federal government joined in the case.
Prosecutors said Glaxo illegally promoted Paxil for treating depression in
children from 1998 to 2003, even though it wasn�t approved for anyone under age
18. The company also promoted Wellbutrin from 1999 through 2003 for weight
loss, sexual dysfunction, substance addictions and attention deficit
hyperactivity disorder, although it was only approved for treatment of major
Starting in 2001, Thorpe reported to his district manager, then to Glaxo�s
human resources department and finally to Glaxo�s chief of global compliance
about a number of improper marketing practices. The compliance chief began an
internal investigation, which confirmed Thorpe�s allegations through various
ways including marketing materials and interviews with Hamrick and other sales
representatives, according to lawyers for the two men.
Dr Gopal Dabade,
Dharwad 580 002