SmithKline Beecham Agrees on Settlement

Pharmaceutical giant SmithKline Beecham has tentatively agreed to pay $325 million to settle allegations that its clinical laboratory business defrauded the U.S. government. If the agreement is approved, it would be one of the largest settlements in the government’s ongoing investigation of health-care fraud and the largest from a clinical lab. The British company, which is headquartered in Philadelphia, reported last year that it had set aside $395 million for potential settlements in two large cases, including the civil fraud case involving Medicare and Medicaid. The case is believed to involve the way the laboratory “bundles” separate blood-chemistry tests together, selling them as a package even though doctors have not ordered all the tests. SmithKline said it believed that “substantially all” of its payment claims were justified but that it was working to resolve the issue.