Missouri Gets $32 Million in Largest U.S. Health Care Fraud Settlement

JEFFERSON CITY, Mo. -- A drug maker is forking over some big bucks to the Show-Me State.

As part of a national settlement, GlaxoSmithKline is paying almost $32 million to the state and about $3 billion nationwide.

The payment -- with $1 billion going to settle criminal wrongdoing, and $2 billion to cover civil liabilities -- is the largest fraud settlement in U.S. history, and the largest payment ever by a drug company.

GlaxoSmithKline pleaded guilty this week to two counts of introducing misbranded drugs, Paxil and Wellbutrin, into interstate commerce.

Specifically, the government alleged that the drugs were marketed as a treatment for conditions for which they had not been approved. It said Paxil, which treats depressive and anxiety disorders in adults, was marketed to children and adolescents, and Wellbutrin, an antidepressant, was marketed as a weight-loss aid.

A third count involves a failure to report safety data about the drug Avandia, a diabetes drug, to the Food and Drug Administration between 2001and 2007.

In addition to the criminal and civil resolutions, GlaxoSmithKline reached a 5-year compliance agreement with the Department of Health and Human Services. Under terms of the deal, according to department Inspector General Daniel R. Levinson, company executives could forfeit annual bonuses if they or their subordinates engage in significant misconduct, and sales agents are now being paid based on quality of service rather than sales targets.

GlaxoSmithKline said in a statement that the settlement would be funded through existing cash resources.

"On behalf of GSK, I want to express our regret and reiterate that we have learnt from the mistakes that were made," CEO Andrew Witty said in a statement, adding that the company has changed its procedures for compliance, marketing and selling since the incidents.

Missouri Attorney General Chris Koster says the money Missouri receives will help pay for health care services for low-income residents.

Read More: GlaxoSmithKline Agrees to $3 Billion Settlement with Justice Department

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