N.J. getting $22.1 million from GSK settlement
New Jersey will get $22.1 million under a multibillion-dollar settlement announced yesterday between the U.S. Department of Justice and drug maker GlaxoSmithKline.
GSK agreed Monday to pay $3 billion to resolve civil and criminal charges that it marketed drugs including Paxil, Wellbutrin and Advair for unapproved uses. The government also alleged the firm misrepresented several drugs' safety and efficacy, paid kickbacks to doctors that promoted or prescribed the drugs, and misreported pricing for the drugs, so as to limit the rebates it owed to Medicaid and other federal programs.
Two thirds of the total settlement amount will go to pay damages to the federal government and participating states. The other billion is a criminal fine.
The $3 billion total makes it the largest health care fraud settlement in U.S. history. However, the billion-dollar scope is becoming more common.
In 2009, Pfizer Inc. agreed to pay $2.3 billion in fines related to its marketing of the pain medication Bextra.
The Wall Street Journal, citing unnamed sources, has reported New Brunswick-based Johnson & Johnson is nearing a deal to pay more than $1 billion to settle off-label marketing charges over the antipsychotic medication Risperdal. That deal has yet to be formally announced.
In a press release, GSK CEO Andrew Witty said the misdeeds occurred during "a different era" in the company's history, and said the firm has made changes at every level of the company to eradicate such problems.
Still, the Justice Department said it will continue to hold drug companies accountable for illegal marketing practices. In a statement yesterday announcing the deal, Deputy U.S. Attorney General James M. Cole gave drug makers a warning.
"Today's multibillion-dollar settlement is unprecedented in both size and scope," Cole said. "It underscores the administration's firm commitment to protecting the American people and holding accountable those who commit health care fraud."