Glaxo whistleblowers to share $250m windfall
Published 04/07/2012 | 08:49
FOUR former GlaxoSmithKline employees will share up to $250m (€198m) after their evidence helped US authorities secure a record settlement with the UK drug company for mispromoting drugs.
Greg Thorpe, Blair Hamrick, Thomas Gerahty and Matthew Burke are in line to receive the payout under the Federal False Claims Act, a US law dating back to the Civil War that allows whistleblowers to receive a portion of money the government recovers when prosecuting fraud.
Glaxo, Britain's biggest drug maker, this week agreed to pay a $3bn fine after admitting to mis-promoting its Paxil and Wellbutrin medicines to US consumers between 1998 and 2003. The company also pleaded guilty to failing to properly submit required safety data to regulators on diabetes drug Avandia between 2001 and 2007. It was alleged Glaxo paid for luxury weekends for doctors at destinations including Bermuda and Hawaii to persuade them to prescribe the mispromoted drugs.
The historic settlement caps an almost decade-long fight for the four men, who had sales and marketing jobs with Glaxo in the US.
Mr Thorpe, 61, who was with Glaxo for more than 20 years before he left in 2002, said: "I cannot be certain, if I knew beforehand what was coming after filing this case, that I could do it again." The father of four has been unemployed since the legal action began and says he now has about $700,000 of debt.
Mr Hamrick, who worked as a salesman for Glaxo in Colorado, says he has since lost his house and that the legal battle has been "a dark cloud hanging over our heads".
Mr Hamrick and Mr Thorpe began the legal action in 2003 after, they claim, their concerns over mispromotion of drugs were ignored by Glaxo.
The whistleblowers' payout will come from a portion of the civil settlement that relates to Glaxo's alleged mispromotion of a series of medicines, including Advair, an asthma drug. Although $686m of the fine Glaxo is paying stems from losses the US government says it incurred because of the alleged mispromotion of Advair, Glaxo did not admit liability on that drug.
"It was an historic settlement for the US taxpayers and it's important to note that this settlement would not have happened without these men," said Erika Kelton, a lawyer for Mr Gerahty and Mr Burke.
US prosecutors judged that the evidence provided by the four helped secure just over $1bn of the total fine the government levied on Glaxo. Officials from the Department of Justice will now determine what percentage of that fine will go to the whistleblowers. Under the False Claims Act, the four men will receive a minimum of about $150m.
A Glaxo spokesman said: "In the last four years we have fundamentally changed procedures. We now encourage employees to seek help and discuss their concerns about ethical issues or suspected cases of misconduct."
The Department of Justice declined to comment.