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GlaxoSmithKline Settles Paxil Lawsuit

March 29, 2006

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GlaxoSmithKline has agreed to pay $14 million to resolve a multistate legal action that claims it wrongfully delayed generic competition for Paxil, its blockbuster drug used to treat depressive, anxiety, and obsessive-compulsive disorders.

The settlement resolves claims by 49 states that charged their Medicaid programs had been gouged. In August 2004, New York Attorney General Eliot Spitzer reached a separate agreement with GSK under which the company became the first major drug manufacturer to publicly disclose information on clinical studies of its drugs.

Spitzer's settlement followed a lawsuit alleging that the company withheld negative information suggesting a possible increased risk of suicidal thinking and acts in certain individuals taking Paxil.

In April 2005, Spitzer reached a second unrelated national settlement with GSK for $10 million. It was designed to resolve state claims that GSK delayed generic competition by fraudulently listing and prosecuting litigation concerning the drug nabumetone, an anti-inflammatory drug that GSK sells under the trademark Relafen.

Proceeds from the settlement will be distributed among the states.

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