Updated on 5 July 2012
Mr Bill Corr, deputy secretary of the Department of Health and Human Services (HHS), commented that this "historic settlement is a major milestone in efforts to stamp out healthcare fraud". "For a long time, our healthcare system had been a target for cheaters who thought they could make an easy profit at the expense of public safety, taxpayers, and the millions of Americans who depend on programs like Medicare and Medicaid. But thanks to strong enforcement actions, such as those we have announced today, that equation is rapidly changing," he said.
This resolution marks the culmination of an extensive investigation by special agents of the HHS-OIG, FDA and FBI, along with law enforcement partners from the federal government. Moving forward, GSK will be subject to stringent requirements under its corporate integrity agreement with the HHS-OIG. The agreement is designed to increase accountability and transparency and prevent future fraud and abuse. Effective law enforcement partnerships and fraud prevention are hallmarks of the Healthcare Fraud Prevention and Enforcement Action Team (HEAT) initiative, which fosters government collaboration to fight fraud.
Mr Witty further said action has been taken at all levels in the company in the US. "We have fundamentally changed our procedures for compliance, marketing and selling. When necessary, we have removed employees who have engaged in misconduct. In the last two years, we have reformed the basis on which we pay our sales representatives and we have enhanced our ability to ‘claw back' remuneration of our senior management. We have a vital role to play in bringing innovative medicines to patients and we understand how important it is that our medicines are appropriately promoted to healthcare professionals and that we adhere to the standards rightly expected by the US Government," he said.
Trouble began for GSK in 2004
In 2004, GSK became aware that the US Department of Justice was investigating sales and promotional practices of the company between January 1997 and 2004 for nine products (Advair, Flovent, Imitrex, Lamictal, Lotronex, Paxil, Valtrex, Wellbutrin, and Zofran). The investigation of Advair was later extended to June 2010. GSK was also informed in 2004 that the US Department of Justice was investigating certain nominal pricing and alleged bundled sale arrangements under the nominal price exception to the best price reporting requirements of the Medicaid Drug Rebate Program.