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GSK Settles Whistleblower False Claims Act Drug Lawsuit

Cheryl Eckard, a GlaxoSmithKline ("GSK") quality-assurance manager, headed a group of scientists that inspected a pharmaceutical plant in Puerto Rico in 2002. The group was responding to a number of FDA complaints citing manufacturing violations at GSK's Cidra facility.

Eckard reported back with bad news, stating that the plant needed to be closed: Her team found problems at Cidra to be so widespread that contamination-free drugs could not be assured or made consistently according to the registered formula.

GSK rejected that advice, regarding Eckard's report as unsubstantiated complaints. In response, she reported the company to the FDA and became a qui tam whistleblower.

Six-plus years later, the government's 2004 lawsuit brought under the False Claim Acts on behalf of Eckard and alleging GSK Medicaid fraud for its manufacturing and sales of adulterated drugs has resulted in a settlement. The agreement reached with GSK will cost it $750 million in fines and other penalties.

A number of drugs were targeted in the investigation. Most centrally, they included:

  • Bactroban ointment - contained harmful microorganisms
  • Paxil CR tablets - anti-depressant drug lacked the stated active ingredient
  • Kytril injection - anti-nausea drug found to be not sterile
  • Avandamet - diabetes drug with doses that ranged from overly potent to subpotent

The Cidra plant was closed last year. At the height of its operations, it was manufacturing more than $5 billion of drugs yearly, with Avandamet and Paxil CR being mainstays of its production line. The FDA has seized the entire stock of those drugs, with GSK losing their estimated market value of approximately $2 billion.

Related Resource: www.lawyersandsettlements.com "Qui Tam Whistleblower - $750 Million Medicaid Fraud Settlement" October 28, 2010

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