GlaxoSmithKline to Pay $3 Billion in Largest Health Care Fraud Settlement

Over charges it marketed drugs for unauthorized uses, held back safety data, and cheated the government's Medicaid program, GlaxoSmithKline (IW 1000/88) was socked with $3 billion in fines by U.S. authorities on July 2.

The Justice Department said GSK was fined over misbranding its drugs Paxil and Wellbutrin, and for holding back data while making unbacked claims for its diabetes drug Avandia.

GSK pleaded guilty and agreed to the fines in what the department called the largest health care fraud settlement in U.S. history.

GSK, one of the world's largest health care and pharmaceuticals companies, admitted to charges that it had promoted antidepressants Paxil and Wellbutrin for uses not approved for by U.S. regulators, including treatment of children and adolescents.

The British drugmaker also conceded charges that it held back data and made unsupported safety claims over its diabetes drug Avandia.

Altogether it will pay $1 billion in criminal fines and forfeitures over charges relating to the three drugs.

In addition, the company will pay $1.7 billion in civil fines for illegal promotion of those drugs as well as others; paying kickbacks in their marketing; and making unsubstantiated claims about Avandia's safety and efficacy.

And separately, GSK is being fined $300 million to settle charges it underpaid rebates it owed to the U.S .Medicaid program.