The Paxil Legal Bill: Glaxo Spends $1B, So Far
6 CommentsBy Ed Silverman // December 14th, 2009 // 8:37 am
The big drugmaker has paid almost $1 billion to resolve lawsuits since launching its antidepressant in 1993, including about $390 million for suicides or attempted suicides said to be linked to the pill, Bloomberg News reports.
The total including $200 paid million to settle Paxil addiction and birth-defect cases and $400 million to end antitrust, fraud and design claims. About 450 suicide-related Paxil cases were settled and about a dozen remain unresolved. The $1 billion total doesn’t include more than 600 claims that Paxil caused birth defects, Bloomberg writes.
The $1 billion “would be worse than many people are expecting,” Navid Malik, an analyst at Matrix Corporate Capital, tells the news service. “I don’t think this is within the boundaries of current assumptions for analysts.”
Glaxo hasn’t disclosed the settlement total in company filings, but has made some public. Glaxo’s provision for legal and other non-tax disputes as of the end of 2008 was $3.09 billion, which includes all legal matters, according to its latest annual report. This included all legal matters, not just Paxil.
By comparison, Wyeth, which sold the fen-phen diet pill combo and is now owned by Pfizer, set aside about $21 billion to resolve about 200,000 personal-injury claims, and Merck. agreed to pay $4.85 billion to resolve more than 48,000 claims over the withdrawn Vioxx painkiller.
About 150 cases over suicides by Paxil users were settled for an average of about $2 million, and about 300 over suicide attempts settled for an average of $300,000, Bloomberg writes, citing sources, and adds Glaxo settled about 10 birth-defect cases, with settlements averaging about $4 million.
Peter
I wonder if any of this was not covered by insurance?
Lisa Van Syckel
A prison sentence would have been more appropriate….. YES?
patrons99
Covered by insurance? You bet. The injury to the federal fisc has to be enormous. We should hope that DOJ is all over this one using, among other legal tools, the False Claims Act Correction Act of 2009. Condor might wish to weigh in on this one. Is the burden of proof met for a criminal conviction?
Condor
Honestly, I really haven’t followed Paxil very closely.
I’ll go do some poking around, but (as ever) proving specific intent to injure — or calluous, knowing indifference to safety of human lives — all of which must be proved to a standard of “beyond a reasonable doubt“, in order to win a conviction, on the putative-felony counts. . .
. . .is often a very tall order, especially if the conviction is sought from the executive “C” suite-dwellers — with all those “insulating” layers of lower management.
Namaste
Condor
I think Peter means that Glaxo may have been covered by insurance for some of this — if it was still able to obtain products liability insurance, at the time of the injuries.
Namaste
Lisa Van Syckel
Condor,.. Google Paxil Money Bag, a picture can paint a thousand words. While you are at it check out how GSK portrays women in their sales pitch.