Covington leads as GlaxoSmithKline receives record $3bn fine
US firm Covington & Burling has taken the lead role for pharma giant GlaxoSmithKline (GSK) on its record $3bn (£1.9bn) criminal and civil settlement over drug misbranding, reports The Blog of Legal Times. The settlement saw GSK agree to plead guilty to criminal charges and to pay $1bn (£638m) in criminal fines and forfeitures for the illegal marketing and promotion of the drugs Paxil and Wellbutrin.
July 03, 2012 at 08:40 AM
2 minute read
US firm Covington & Burling has taken the lead role for pharma giant GlaxoSmithKline (GSK) on its record $3bn (£1.9bn) criminal and civil settlement over drug misbranding, reports The Blog of Legal Times.
The settlement saw GSK agree to plead guilty to criminal charges and to pay $1bn (£638m) in criminal fines and forfeitures for the illegal marketing and promotion of the drugs Paxil and Wellbutrin.
Officials said the company between 1998 and 2003 unlawfully promoted Paxil for treating depression in patients under the age of 18. The officials said GSK also illegally promoted Wellbutrin for uses that included weight loss, substance abuse and sexual dysfunction.
US Justice Department (DoJ) officials said the company will pay an additional $2bn (£1.28bn) to resolve civil allegations under the False Claims Act. The claims include allegations that company officials paid kickbacks to doctors to prescribe certain drugs, including Paxil, Wellbutrin and Advair.
Deputy attorney general James Cole called the deal "unprecedented in both size and scope," adding: "this historic action is a clear warning to any company that chooses to break the law."
Covington fielded a Washington-based team advising GSK which included partners Geoffrey Hobart and Matthew O'Connor. Hobart, who specialises in the defense of pharmaceutical companies, and O'Connor, a white-collar defence and investigations lawyer, were not immediately available for comment.
GSK also agreed to a five-year corporate integrity agreement, which will see the company required to change its executive compensation program to allow it to recoup bonuses and long-term incentives if certain executives, or subordinates, engage in significant misconduct.
Other law firms to take associated roles on the settlement included Delaware's Grant & Eisenhofer Washington's Phillips & Cohen, both of which represented whistleblowers.
"Today brings to resolution difficult, long-standing matters," GSK chief executive officer Andrew Witty said in a statement. "Whilst these originate in a different era for the company, they cannot and will not be ignored. On behalf of GSK, I want to express our regret and reiterate that we have learned from the mistakes that were made."
The Blog of Legal Times is a US affiliate title of Legal Week.
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