GlaxoSmithKline to plead guilty and pay record $3 billion to resolve US fraud allegations

UK pharma giant GlaxoSmithKline (LSE: GSK) has agreed to plead guilty and to pay $3 billion - the largest health care fraud settlement in US history - to resolve its criminal and civil liability arising from the company’s unlawful promotion of certain prescription drugs, its failure to report certain safety data, and its civil liability for alleged false price reporting practices, the Justice Department announced yesterday.

The final settlement of the $3 billion - which exceeds the $2.3 billion in fines paid by Pfizer on similar charges in 2009 - is covered by existing legal provisions announced last year, said GSK (The Pharma Letter November 4, 2011).

GSK agreed to plead guilty to a three-count criminal information, including two counts of introducing misbranded drugs, Paxil and Wellbutrin, into interstate commerce and one count of failing to report safety data about the drug Avandia to the Food and Drug Administration. Under the terms of the plea agreement, GSK will pay a total of $1 billion, including a criminal fine of $956,814,400 and forfeiture in the amount of $43,185,600.