GlaxoSmithKline to pay out $90M more for Avandia claims

Company settles with 38 states on claims of fudging health risks of blockbuster drug
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GlaxoSmithKline ($GSK) has shaken off more litigation tied to the safety of its Avandia diabetes drug by agreeing to pay $90 million in a settlement with 38 states. It did so without contrition.

A representative for the states said the settlement holds the company accountable for misrepresenting the drug's health risks, The Wall Street Journal reports. The company, for its part, denied culpability but said it was settling to avoid further costly litigation.  

"With regards to Avandia, we firmly believe we acted responsibly in conducting the clinical trial program, in marketing the medicine, in monitoring its safety once it was approved for use and in updating information in the medicine's labeling as new information became available," the company said in a statement.

The settlement is separate from the whopping $3 billion settlement GSK signed off on in July to wrap up a variety of long-standing Justice Department probes. That was the largest healthcare fraud settlement in history and involved a variety of off-label marketing claims for other GSK drugs as well as the allegation the company downplayed the risks of the once-multibillion-dollar blockbuster Avandia. In the federal case, it also pleaded guilty to three counts.  

As The Wall Street Journal points out, Avandia sales peaked at about $2 billion a year before the FDA in 2010 put tight restrictions on its use. Authorities in Europe ordered it removed from the market because of elevated risks of heart attack. The company took a $2.4 billion charge that year to cover litigation. Earlier this year, it settled through mediation 25,000 cases tied to the drug.

- read the Wall Street Journal story (sub. req.)

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