GlaxoSmithKline Will Pay $750M to Settle Medicaid Fraud Lawsuit

Pharmaceutical giant GlaxoSmithKline, based in Research Triangle Park, N.C., has agreed to pay $750 million to settle allegations that it manufactured and sold contaminated drugs to Medicaid and other government health programs, according to a Department of Justice news release.

The drugs in questions were manufactured at a plant located in Puerto Rico between 2001 and 2005. The Food, Drug and Cosmetic Act prohibits the introduction of any contaminated or adulterated drugs into the market. This means all pharmaceutical drugs that are not manufactured, processed, packaged or held according to safe practices and that do not meet quality and purity measurements are deemed adulterated.

Many of GSK's drugs — including Kytril, Bactroban, Paxil CR and Avandamet — were deemed adulterated in many ways. For example, GSK is accused of manufacturing Paxil CR in a way that caused the tablets to split, causing the drugs to not have any therapeutic effect. GSK also allegedly caused tablets of one drug type and strength to be commingled with tablets of another drug type and strength in the same bottle, leading to product mix-ups.

Read the DOJ news release about GlaxoSmithKline's settlement.

Read other coverage about pharmaceutical fraud:

- Advocacy Group: Pharmaceutical Companies Top List of DOJ Settlements

- News Database Reveals Financial Relationships Between Physicians and Pharmaceutical Companies

- Connecticut Wins $15M From Pharmaceutical Company McKesson in Drug Pricing Lawsuit

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