Healthcare Matters

In the largest fraud settlement in U.S. history, GlaxoSmithKline (GSK) pleaded guilty today to criminal charges related to its branding, safety disclosures and price reporting of several drugs.

The Justice Department today announced a “global settlement” that resolves three investigations related to the pharmaceutical giant. GSK has agreed to pay $3 billion in settlements and plead guilty to criminal charges including charges related to the False Claims Act, safety disclosures, price reporting, kickbacks, off-label marketing and the mis-branding of Paxil and Wellbutrin. Add-in a little Medicaid fraud (failure to report best prices) and that pretty much sums it up. Who knows, maybe they passed a few bad checks too?

I’m not sure how it all rolls up into three investigations, but the $3 billion is the largest fine of its kind in US history.

In a written statement, the company said the settlements will be paid with existing cash reserves, now that negotiations with various government agencies had concluded. The company will also enter a corporate integrity agreement. That means GSK’s executives have agreed to hold themselves up to a higher standard of behavior –in the future– or suffer real consequences.

“Today brings to resolution difficult, long-standing matters for GSK,” said  CEO Sir Andrew Witty.  “On behalf of GSK, I want to express our regret and reiterate that we have learnt from the mistakes that were made.”

$3 billion will do that for you.

—Tom Finn