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18 March 2015

GlaxoSmithKline’s $3 Billion Settlement: What The Department Of Justice Claimed About Zofran

Global healthcare giant GlaxoSmithKline manufactures and markets many of the world’s most widely-used drugs, including Advair, Ventolin and Avandia.

In 2013 alone, the company made around $39 billion in total revenue.

One year earlier, in 2012, the US Department of Justice brought an array of civil and criminal charges against the company. The government’s allegations included multiple claims that the drug manufacturer had “unlawfully promoted” certain prescription medications for unapproved uses and “fail[ed] to report” safety data to the US Food & Drug Administration (FDA).

The DOJ also made claims about the company’s hugely successful anti-nausea drug Zofran. Along with generic versions of its active ingredient ondansetron, Zofran has quickly become America’s leading treatment for morning sickness, the nausea and vomiting that accompanies early pregnancy. Zofran has never been approved for use in pregnant women, or as a treatment for nausea and vomiting of pregnancy. Blue white and yellow pills

Did GlaxoSmithKline Plead Guilty To Claims Of Health Care Fraud?

Many sources have incorrectly reported that the manufacturer pled guilty to the government’s allegations surrounding Zofran.

That’s just not true.

In this article, our attorneys will discuss the specific claims that the Department of Justice made in regards to Zofran, as well as the company’s response to these allegations.

Zofran’s Manufacturer Admitted Liability To Certain Charges

According to the DOJ’s own press release, GlaxoSmithKline “agreed to plead guilty” on several of the criminal counts:

  1. “introducing misbranded drugs, Paxil and Wellbutrin, into interstate commerce” and
  2. “failing to report safety data about the drug Avandia to the Food and Drug Administration.”

In order to settle this criminal liability, the company agreed to pay a total of $1 billion to the Department of Justice.

Those, in short, are the charges to which the company actually pled guilty.

What About Zofran?

In the case of Zofran, the Department of Justice made three interrelated civil allegations. Here they are, as set out in GlaxoSmithKline’s Settlement Agreement with the Department of Justice:

Between January 1, 2002 and December 31, 2004, GlaxoSmithKline:

  • “knowingly promoted the sale and use of Zofran for a variety of conditions other than those for which its use was approved as safe and effective by the FDA[.]”

The Department of Justice’s allegations include only one specific example: “hyperemesis or pregnancy-related nausea.”

  • “made and / or disseminated unsubstantiated and / or false representations or statements about the safety and efficacy of Zofran concerning” the drug’s use as a treatment for pregnancy-related nausea
  • “offered and paid illegal remuneration to health care professionals to induce them to promote and prescribe Zofran.”

In short, the DOJ claimed that GlaxoSmithKline:

  1. marketed Zofran as a safe and effective treatment for morning sickness, despite the fact that it had not been approved for use in pregnant women
  2. produced marketing materials that contained unsubstantiated or false claims of Zofran’s safety as a treatment for morning sickness
  3. paid physicians kickbacks to prescribe Zofran to pregnant women suffering from morning sickness.

GlaxoSmithKline continues to deny these allegations.

While the company agreed to pay a total of $1,042,612,800 to resolve the government’s civil claims, court documents clearly state that the settlement “is neither an admission of facts or liability by GSK.”

In other words, the company maintains that it was not guilty of any wrongdoing in regard to Zofran. For its part, the Department of Justice continues to say that the settlement “is not a concession by the United States […] that [its] claims are not well-founded.”

How Much Of The Settlement Resolved Zofran-Related Claims?

Of that more than $1 billion settlement agreement:

  • $2,320,640 were paid specifically to resolve claims of wrongdoing in relation to Zofran, and
  • $54,637,287 were paid to resolve claims of paying kickbacks to physicians for prescribing drugs, including Zofran, off-label.

Did The Settlement Have Anything To Do With Birth Defects?

No.

Several recent studies have begun to establish an association between ondansetron, Zofran’s active ingredient, and birth defects including cleft palate and congenital heart defects.

The Department of Justice’s claims made no mention of Zofran’s potential effects on fetal development, nor has the FDA released a statement on this matter.