Paxil Antitrust Settlement Agreement Gets Court Approval

A federal judge has approved a settlement agreement under which GlaxoSmithKline (GSK) will pay $65 million to settle a class action antitrust lawsuit over its antidepressant Paxil.

U.S. District Judge John Padova of the U.S. District Court for the Eastern District of Pennsylvania recently issued a decision approving the settlement, which was originally presented to the court in February. Padova awarded the plaintiffs' attorneys 30 percent, or $19 million, of the settlement funds to cover legal costs.

The Paxil case dates back to December 2000 when a group of consumers filed suit against GSK legacy company SmithKline Beecham. The plaintiffs alleged SmithKline used a series of phony patent lawsuits to illegally delay generic competition for Paxil (paroxetine HCl). The lawsuit claimed that the company's actions led to inflated prices for Paxil, costing consumers millions of dollars.

The final settlement amount totaled between 9.3 percent and 13.9 percent of the total possible damages in the case, which, according to an expert for the plaintiffs, would have ranged from $466 million to $693 million depending on the entry dates of generic versions of Paxil.

The Feb. 1 settlement agreement calls for GSK to pay reparations to all U.S. consumers or organizations that purchased or paid for Paxil or its generic alternatives between Jan. 1, 1998, and Sept. 30, 2004.