DRUGMAKER GlaxoSmithKline is understood to have paid out around $1bn (£698m) to resolve lawsuits over the antidepressant Paxil after it introduced the drug in 1993.
Around $390m is thought to have been paid out on cases related to suicides and attempted suicides, $200m to settle addiction claims and birth defects resulting from the drug, and a further $400m to close off antitrust, fraud and design claims.
Glaxo, the biggest drug maker in the UK, hasn’t disclosed the amount it has paid out to settle in company filings, but at the end of 2008 its provision for legal and non-tax disputes was £1.9bn, with £112m to be “reimbursed by third-party issuers”.
But analysts were sceptical at the disclosed amount, saying $1bn would be much more than people expected, and it was outside of their expectations.
The company has also cut down its insurance coverage to contain costs, “accepting a greater degree of uninsured exposure,” according to its latest annual report.
“Recent insurance loss experience has increased the cost of insurance for pharmaceutical companies generally,” it said.