GSK legal charge includes $750M DOJ deal on Cidra

It's legal wrap-up week for GlaxoSmithKline. First, the company agreed to settle the bulk of its Avandia litigation. Now, the company is announcing a $2.36 billion charge to second-quarter earnings, to cover the cost of resolving several legal problems including the Avandia settlement, but also a $750 million deal to dispose of a U.S. manufacturing investigation.

That government probe involved manufacturing problems at GSK's former plant in Cidra, Puerto Rico. That plant made several drugs, mostly for the U.S. market, but it was closed in 2007 after two years under an FDA consent decree. Now GSK has made a $750 million deal with the U.S. Attorney's Office in Massachusetts and the U.S. Justice Department, and the details are still subject to negotiation, GSK said in a release.

The company says it's resolved most of its Paxil liability suits and worked out antitrust litigation with Apotex, a generics maker that jumped into the Paxil market with a copycat version. And then there's the Avandia litigation; this charge covers not only the $460 million settlement of 10,000 cases earlier this week, but an estimate for cases that are still outstanding.

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