GlaxoSmithKline agrees $3bn US settlement
Settles US government investigations into sales and marketing practices
GlaxoSmithKline (GSK) has agreed to pay US$3bn (£1.9bn) to settle all US government investigations into the UK drugmaker’s sales and marketing practices.
The settlement, over both civil and criminal claims, is expected to be finalised next year and will be paid through the firm’s cash resources, said GSK. It includes a Department of Justice investigation of the development and marketing of the firm’s diabetes drug Avandia, as well as a marketing investigation in Colorado and Massachusetts, and a probe into refunds offered under the federal Medicaid programme.
‘This is a significant step toward resolving difficult, long-standing matters which do not reflect the company that we are today,’ said GSK’s chief executive Andrew Witty.
‘In recent years, we have fundamentally changed our procedures for compliance, marketing and selling in the US to ensure that we operate with high standards of integrity and that we conduct our business openly and transparently.’
Among the steps taken is the implementation of a new incentive compensation system for its sales representatives who work directly with healthcare professionals. The firm no longer bases bonuses on individual sales targets, but on the ‘quality of the service these representatives deliver to customers’.
