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Vermont To Receive $136,000 From Settlement Of Claims Against Glaxosmithkline For Selling Defective Drugs

CONTACT: Edward A. Baker, Assistant Attorney General, (802) 828-5511

January 13, 2011

Attorney General William H. Sorrell announced today that Vermont will receive approximately $136,000 as part of a settlement with pharmaceutical manufacturer GlaxoSmithKline (GSK) of allegations that the company manufactured and sold defective drugs. According to the terms of the settlement, GSK will pay the states and federal government $600 million in civil damages and penalties, and a GSK subsidiary, SB Pharmaco of Puerto Rico, where the adulterated drugs were produced, will plead guilty to a felony violation of misbranding, and pay $150 million in criminal fines and forfeitures. The settlement resolves allegations that arose out of a whistleblower complaint that, at different times between 2001 and 2005, GSK knowingly manufactured, distributed, and sold four products whose strength, purity and/or quality fell below standards required by the FDA:

  • Paxil CR: A controlled-release antidepressant that included split tablets, causing recipients to receive either product with no active ingredient and/or product with only the active ingredient layer and no controlled release mechanism;
  • Avandamet: A diabetes medication with tablets containing higher or lower amounts of the active ingredient than specified;
  • Kytril: An anti-nausea drug used with chemotherapy treatments that was labeled as sterile but included vials containing impurities;
  • Bactroban: Antibiotic ointments and creams used to treat skin infections in children that, in some packages, were contaminated with microorganisms.
  • Vermont’s recovery as part of the settlement represents damages equal to two times the amount the Vermont Medicaid program paid for the products. GSK has also agreed to enter into a Corporate Integrity Agreement with the federal government to closely monitor the company’s future manufacturing practices.

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