By Maximilian Clarke
GlaxoSmithKline plc (GSK) have agreed a $3bn settlement with the US Federal Government following an ongoing investigation into the drugs giant’s marketing practices.
The final settlement, which is expected to address civil and criminal liabilities, remains subject to negotiation of specific terms and is expected to be finalised in 2012. The settlement of $3 billion is covered by existing provisions and GSK expects to make payments under the final agreement in 2012. These payments will be funded through existing cash resources.
The GSK Board and management team have been focused on resolving these long-standing legal matters and reducing financial uncertainty for the Group and believe this agreement in principle to be in the best long-term interests of shareholders.
“This is a significant step toward resolving difficult, long-standing matters which do not reflect the company that we are today,” said GSK’s CEO, Andrew Witty. “In recent years, we have fundamentally changed our procedures for compliance, marketing and selling in the US to ensure that we operate with high standards of integrity and that we conduct our business openly and transparently.
“We reiterate our full commitment to ensuring appropriate promotion of our medicines to healthcare professionals and to the standards rightly expected by the US Government.”
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