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GSK's diabetes drug Avandia was one of the drugs being mislabelled in the Puerto Rican plant. Paul Sakuma/AP

GSK agrees €542m settlement over 'defective' drugs

Action over mislabelled diabetes and antidepressant drugs results in a massive settlement in the US.

ONE OF THE WORLD’S biggest drug manufacturers has agreed a $750m (€542m) settlement with the US Justice Department to end a false-claims lawsuit which had been filed by one of its own staff.

Cheryl Eckard was GlaxoSmithKline’s global quality assurance manager in 2004 when she turned whistleblower and revealed that many drugs being manufactured by a now-closed GSK plant in Puerto Rico were being sold on the mass market, despite having been misidentified as a result of a number of production mishaps.

The Boston Globe reports that affected drugs included the company’s widely-used antidepressant drug Paxil CR, its diabetes drug Avandamet, its Bactroban skin ointment, and an anti-nausea drug Kytril. There were more than 20 drugs affected in total.

In the settlement, GSK admitted operating its Puerto Rico unit “in a manner that was inconsistent with current good manufacturing practice requirements.” The settlement includes a criminal fine of $150m and a $600m civil settlement under the False Claims Act.

US Attorney Carmen Ortiz said that “as this investigation demonstrates, we will not tolerate corporate attempts to profit at the expense of the ill and needy in our society – or those who cut corners that result in potentially dangerous consequences to consumers.”

Eckard told reports after the settlement was announced that ratting out her company was not “something I wanted to do”, but an act that was necessary in order to safeguard pateint safety.

Shares in GSK on the New York stock exchange remained broadly flat on foot of the news – broadly because the fine had been budgeted for in the company’s Q2 results.

GSK has three facilities in Ireland – in Dublin, Cork and Dungarvan – employing a total of about 1,500 staff.