GlaxoSmithKline whistleblower awarded $96m payout

Whistleblower who exposed contamination problems at Glaxo plant in Puerto Rico receives $96m
Wednesday 27 October 2010 12.15 BST

http://www.guardian.co.uk/business/2010/oct/27/glaxosmithkline-whistleblower-awarded-96m-payout

GlaxoSmithKline has ended an eight-year legal fight by agreeing to pay US authorities $750m. Glaxo whistleblower Cheryl Eckard has been awarded $96m. Photograph: Martin Godwin

A whistleblower who exposed serious contamination problems at GlaxoSmithKline‘s (GSK) pharmaceutical manufacturing operations has been awarded $96m (£60m).

Cheryl Eckard’s payment is thought to be the biggest ever handed to a US whistleblower. It was awarded after an eight-year fight, which ended yesterday, when GSK agreed to pay the US government $750m to settle civil and criminal charges that it manufactured and sold adulterated drug products.

Speaking outside the federal courthouse in Boston after the award was agreed, Eckard admitted she was “a little emotional”.

“It’s difficult to survive this financially, emotionally, you lose all your friends, because all your friends are people you have at work,” she said. “You really do have to understand that it’s a very difficult process but very well worth it.”

The case centred on a factory in Cidra, Puerto Rico, where GSK made a range of products including an antibiotic ointment for babies, and drugs to treat nausea, depression and diabetes. In August 2002, Eckard, a global quality assurance manager, led a team sent to the plant to investigate manufacturing violations that had been identified by the US Federal Drugs Administration (FDA). Eckard lost her job nine months later after warning that the problems ran deeper than the FDA realised.

Eckard’s lawyers, Getnick & Getnick, said she was made redundant against her will in May 2003 after repeatedly complaining to GSK’s management that some drugs made at Cidra were being produced in a non-sterile environment, that the factory’s water system was contaminated with micro-organisms, and that other medicines were being made in the wrong doses.

“Cheryl Eckard is a role model for whistleblowers,” said Lesley Ann Skillen, a partner at Getnick.

Carmen Ortiz, US attorney for Massachusetts, said the case should serve as a warning to other pharmaceutical companies. “We will not tolerate corporate attempts to profit at the expense of the ill and needy in our society,” Ortiz told a press conference last night.

Eckard tried to alert GSK’s management to the situation in Cidra even after she left the company. According to the lawsuit brought by Eckard, she tried to call GSK’s chief executive JP Garnier in July 2003, but he declined to speak to her. She took her concerns to the FDA in August 2003 after concluding that GSK’s compliance department lacked the authority to address her concerns.

Getnick & Getnick said the case was particularly significant because it was so difficult for patients to spot deficiencies with medicines.

“Once the pill is swallowed, it’s gone and there may be no way of telling whether someone got sick because the product was bad. As a result of this settlement and guilty plea, drugmakers will now have more reason to live up to their motto that patient safety is their first priority,” Skillen said.

The Cidra factory had been GSK’s largest manufacturing operation but was closed last year. Drugs made at the plant include Bactroban ointment, a topical antibiotic used to treat skin infections in babies, Kytril, an anti-nausea drug used by cancer patients, anti-depressant treatment Paxil CR and Avandamet, a derivative of the diabetes drug Avandia.

GSK announced in July that it would pay $750m to settle the charges, and the details were finally agreed on Tuesday in Boston. It will pay fines totalling $150m, plus related claims of $600m.

GSK said that it had worked hard to resolve the problems at Cidra, adding that it has not received any warnings from the FDA since 2002.

“We regret that we operated the Cidra facility in a manner that was inconsistent with current good manufacturing practice requirements and with GSK’s commitment to manufacturing quality,” said PD Villarreal, GSK’s senior vice-president and head of global litigation.

Eckard’s lawsuit was filed under the False Claims Act, legislation that dates back to the days of Abraham Lincoln. It is designed to allow private citizens with knowledge of fraud on the government to sue and share in the proceeds of the recovery.