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Glaxo Pays $11.8 Million to N.C. in Settlement

From Herald-Sun (Durham, NC) (February 23, 2011)

Feb. 23--RALEIGH -- Five pharmaceutical companies -- including Durham-based GlaxoSmithKline -- have paid more than $25 million to North Carolina in the wake of investigations by the state's Medicaid Investigations Unit and as part of federal and state settlements.

GSK paid nearly $12 million here, well more than any of the other four companies.

Here is a summary of the cases:

GlaxoSmithKline (GSK) paid $11,846,289.32 to North Carolina as part of a $600 million settlement with state and federal governments. The settlement resolves allegations that GSK knowingly manufactured and sold four products whose strength, purity and quality did not meet FDA standards. The products identified in the investigation as not meeting standards were controlled-release antidepressant Paxil CR , diabetes medication Avandamet, anti-nausea drug Kytril and antibiotic ointment Bactroban.

Allergan, Inc. and Allergan USA, Inc. paid $1,388,079.10 to North Carolina to resolve allegations that the company improperly marketing its drug Botox for uses not approved by the U.S. Food and Drug Administration (FDA).

Kos Pharmaceuticals, Inc. has paid $415,425,92 to North Carolina to settle charges that the company marketed cholesterol drugs Advicor and Niaspan for unapproved uses and paid doctors kickbacks to encourage use of the drugs.

Forest Laboratories, Inc. and Forest Pharmaceuticals, Inc. paid $5,362,477.63 to North Carolina. It was alleged that Forest marketed anti-depressants Celexa and Lexapro for use in children even though the FDA approved the drugs to treat adults only. In addition, the investigation uncovered evidence that Forest continued to distribute the drug Levothroid to treat thyroid problems even after the FDA removed it from the list of covered outpatient drugs.

Novartis Pharmaceuticals Corporation paid $6,248,818.25 to North Carolina to resolve allegations that it made illegal payments to health care professionals to encourage them promote and prescribe six Novartis drugs -- Trileptal, Diovan, Zelnorm, Sandostatin, Exforge and Tekturna -- for uses not approved by the FDA.

Of the total amount recovered by North Carolina through these cases, nearly $4.5 million will go to the public schools The remaining funds will go to support Medicaid efforts in the state. Medicaid is a joint federal-state program that provides health insurance for the poor.

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Posted: February 2011