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Drugs firm to pay US pounds 1.88bn fine.

GLAXOSMITHKLINE has agreed to one of the largest fines ever levied on a pharmaceuticals firm to settle a trio of long-running disputes with the US government.

The UK drugs giant will pay pounds 1.88bn to end three separate legal cases that stretch back to 1997 and relate to the sales and marketing of nine drugs.

The actions related to the sales and marketing of anti-depressants Paxil and Wellbutrin, the Medicaid Rebate Program, and the Department of Justice's investigation into the development and marketing of diabetes drug Avandia.

GlaxoSmithKline said it had already made provisions for the fine in its accounts, but would now have to pay the cash costs.

The Brentford-based firm set aside pounds 2.5bn in its last financial year to cover long-standing legal claims, including many relating to its controversial diabetes drug Avandia, which was taken off the market in Europe following allegations it increased risks of heart attack.

Chief executive Andrew Witty said: "This is a significant step toward resolving difficult, long-standing matters which do not reflect the company that we are today. We have fundamentally changed our procedures for compliance, marketing and selling in the US to ensure we operate with high standards of integrity and conduct our business openly."

Glaxo added that since 2008, its US sales team was paid on an assessment of how effective treatments were rather than the number of prescriptions written.
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Title Annotation:Business
Publication:The Journal (Newcastle, England)
Date:Nov 4, 2011
Words:232
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