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Attorney General's News Release

November 16, 2010

Attorney General Koster obtains settlement with GlaxoSmithKline over adulterated drugs--state to receive $3.5 million--

Jefferson City, Mo.- Attorney General Chris Koster today said an agreement was reached in principle with the pharmaceutical manufacturer GlaxoSmithKline (GSK) to settle allegations the company sold adulterated drugs in Missouri. As a result, GSK will pay the state and the federal government $9 million in civil damages for Missouri Medicaid Program, of which Missouri will receive $3.5 million. Additionally, GSK subsidiary, SB Pharmaco of Puerto Rico, where the drugs were manufactured, has agreed to plead guilty to a felony violation of the U.S. Food, Drug, and Cosmetic Act, and has agreed to pay $150 million in criminal fines and forfeitures.

Koster is participating in the national federal and state civil settlement totaling $600 million dollars. The settlement resolves allegations of poor manufacturing practices in the GSK facility located in Cidra, Puerto Rico. The investigation grew out of a false claims action filed in 2004 in U.S. District Court in Massachusetts. The whistleblower's complaint alleged that GSK knowingly manufactured, distributed, and sold four products - Paxil CR, Avandamet, Kytril and Bactroban - whose strength, purity and/or quality fell below the 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 labeled as sterile but with some vials containing impurities;

Bactroban: Antibiotic ointments and creams that, in some packages, were contaminated with microorganisms.

This settlement agreement, which was first announced in late October, reimburses the federal government and the participating states for the amounts paid by the Medicaid program as a result of GSK's conduct. Additionally, GSK has agreed to the terms of a Corporate Integrity Agreement (CIA) with the Department of Health and Human Services, Office of the Inspector General, which will require scrutiny of GSK's future manufacturing practices.


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