GSK and SB Pharmco at Cidra: The Plant’s Own Records Told a Different Story

The GSK Cidra settlement required $600 million to resolve civil allegations that defective drugs from its Puerto Rico plant reached government health care programs. The whistleblower’s complaint described a plant that recorded drug mix-ups internally while telling the Food and Drug Administration those same kinds of mix-ups were unlikely to have happened there. For someone working in quality assurance, manufacturing or laboratory testing, the case turns on a familiar question: what happened when the company’s own records contradicted the product it kept shipping?

SB Pharmco Puerto Rico operated the plant as a GlaxoSmithKline subsidiary. The Department of Justice announced the civil settlement on October 26, 2010, resolving a pharmaceutical fraud case brought by a former global quality assurance manager. GSK’s later settlement involving off-label promotion, drug-safety representations and price reporting came in 2012. The Cidra case concerned what came out of the factory.

The Drug Defects in the Civil Settlement

The government’s civil allegations concerned defects in Kytril, Bactroban, Paxil CR and Avandamet. Patients depended on those medicines, and taxpayers allegedly paid for drugs that did not meet the promised quality.

Kytril was an anti-nausea medicine. The government alleged that some vials labeled sterile were nonsterile. The complaint connects that product failure to the facility: a June 2003 quality audit called for immediate suspension of Kytril injection manufacturing because of high contamination levels. According to the complaint, the auditors called for investment to improve sterile operations or closure of the sterile facility.

Bactroban treated skin infections. The government alleged that some packages of its ointments and creams contained microorganisms. The complaint described a particularly telling recurrence: a lot released on March 4, 2003 contained the same microorganism that had prompted an FDA-mandated recall the previous year. It also alleged that the plant lacked formal validation supporting microbial cleaning of the ointment holding tank.

Paxil CR was the controlled-release version of the antidepressant. Its two-layer tablets allegedly split, leaving some consumers with a portion containing no active ingredient and others with the active ingredient layer without the controlled-release mechanism.

Avandamet was a combination diabetes drug. The civil agreement’s product-by-product account describes tablets allegedly containing higher or lower amounts of rosiglitazone than prescribed by the product specifications.

A manufacturer sells a particular strength, dosage form and presentation. The Cidra allegations reached the medicine inside the package, from the amount of active ingredient to whether a vial labeled sterile actually was.

FDA’s Warning Letter and the Recovery Effort

The third amended complaint describes Food and Drug Administration inspections that preceded the internal review. Its account says the agency found deficiencies in laboratory controls, investigations and sterile filling in 2001, initially accepted GSK’s response, then found continuing problems the following year.

According to the complaint, a July 2002 warning letter prompted GSK to promise better investigations, calibration and quality assurance staffing. It says the company assigned a global quality assurance manager to lead the recovery effort across the plant.

There was a commercial reason to get the plant ready. The complaint says the Food and Drug Administration had tied pending approvals for Avandamet and Factive to an adequate response and reinspection of Cidra. Management needed the manufacturing problems resolved to move those products forward.

The complaint describes an internal review of what the Food and Drug Administration’s inspections had missed. It alleges that senior management received an August 2002 presentation about mix-ups and other unresolved quality problems, along with a recommendation to stop shipments, suspend manufacturing while the problems were investigated and notify the agency.

The complaint alleged that senior managers held the authority to stop production and shipments but failed to act. It also alleged that GSK disbanded the corrective teams after the Food and Drug Administration’s reinspection and Avandamet’s approval, while overstating its progress to the agency.

Field Alerts Pointed Outside a Plant That Had Recorded Mix-Ups

Cidra’s internal findings and its reports to the Food and Drug Administration allegedly told different stories. The complaint says the plant had filed at least seven Field Alert reports during 2002 after complaints about different drugs or strengths in the same bottle. It alleges that an internal presentation identified nine separate, similar mix-ups inside the plant.

The complaint’s point was what the company knew when it answered the regulator:

The complaint also explains a physical route for the mix-ups. Managers allegedly attributed them to reuse of bulk fiber board drums across different drugs or tablet strengths. In that account, uncoated tablets became mixed before coating, leaving size and shape as the ways to recognize a wrong tablet in the final batch.

According to the complaint, a later internal investigation linked most mix-ups to drum cleaning and preparation in the compression area. It alleged that Cidra still did not tell the Food and Drug Administration about those findings or initiate recalls.

In the complaint’s account, the customer saw the wrong pill. The plant knew how it handled the drums, what its investigation found and what it told the Food and Drug Administration. Putting those accounts together exposed the alleged contradiction.

What the Quality Audits Found

The complaint describes failures in both manufacturing and the systems meant to check it. Its account of the internal review records 283 overdue process investigations in August 2002, while the plant continued manufacturing and releasing product.

Those investigations concerned deviations that could affect drug quality. They were supposed to address such problems as mixed products, dirty equipment or test results outside specifications. Leaving them unresolved meant leaving the effect on released batches unresolved too.

The complaint also describes equipment urgently needing calibration. Without it, data used to assess product quality could not be trusted. It alleges that critical validation, investigation and change-control documents were unsigned, undated, lost or missing.

Contaminated Water and Contaminated Test Controls

The complaint says a June 2003 audit found that the water-system design allowed stagnant water with microbial contamination to accumulate, prompting auditors to call for assessment and redesign.

Testing had its own problems. According to the complaint, negative controls used in contamination testing were themselves contaminated, and production continued while investigations failed to identify the cause.

Audit Findings Without Audit Reports

According to the complaint, GSK’s policy required retaining internal audit reports so later reviews could track what had been found and corrected. It alleged that Cidra did the opposite:

The complaint says action plans were undocumented and the audit program omitted the sterile area and air-handling system. In that account, discussion replaced a record of whether the work was done.

A similar reporting problem appears in the Baxter manufacturing complaint. A whistleblower alleged that managers stopped technicians from replacing mold-contaminated air filters and discouraged notes on certification reports. In both accounts, the contamination and management’s response to its documentation belong in the same story.

From a Defective Lot to a Government Claim

Current good manufacturing practice standards concern a drug’s safety, identity, strength, quality and purity. The government’s civil allegation connected Cidra’s defective drugs to public payments. It contended that GSK sold batches whose strength differed materially from, or whose purity or quality fell materially below, the specifications in their Food and Drug Administration applications or related documents. Those sales allegedly caused false claims or government purchases.

The signed agreement names Medicaid, TRICARE, the Federal Employees Health Benefits Program and Department of Veterans Affairs purchases. It covers specified conduct from January 1, 2001 through April 1, 2005. The payment could reach GSK’s product through a health program’s reimbursement or through the government’s own purchase.

The complaint went beyond describing conditions on the factory floor. Its appendix included examples of alleged claims with the product and strength, payment, quantity and dispensing pharmacy. That is the connection a manufacturing insider’s knowledge can help explain: what the batch should have contained, what the company learned about it, what it released and what a public healthcare program paid for.

In this case, a quality manager brought the qui tam case and the Justice Department joined it. The government’s allegation reached GSK’s manufacturing decisions even where another participant submitted the resulting claim. Our work with an insider connects those decisions and product records to the government money.

Private Insurers Also Challenged What They Bought

Private insurers alleged a similar break between what GSK represented and what they paid for. A November 2016 federal court opinion describes claims by 41 health insurers that GSK’s quality representations led them to cover Cidra drugs they otherwise would not have included in their formularies.

The insurers tied the alleged concealment and quality problems directly to their purchases. The opinion also recounts FDA’s seizure of Avandamet and Paxil CR stocks in March 2005 and a consent decree the following month, a court agreement restricting distribution of adulterated Cidra products. It records that the plant closed in late 2009.

The public and private cases followed the same commercial question: what did the manufacturer represent about the medicine that persuaded a purchaser to pay for it?

How Much Money Do Pharmaceutical Whistleblowers Get for Exposing Fraud?

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

The Cidra civil settlement allocated $436,440,000 to the federal government. The Justice Department announced that GSK would pay up to $163,560,000 to participating states. In this case, the signed agreement set the whistleblower’s share at 22% of the federal settlement amount, which the department announced as approximately $96 million.

The former employee’s quality-system knowledge supplied the internal account: the mix-ups, the warnings, the overdue investigations and the decisions to keep releasing product. That was the expertise behind this case.

You Know What the Plant Released

If you know which batches failed, what the quality reports said or who approved continued shipments, speak with our pharmaceutical whistleblower experts. We build the case with you around the product, the decisions and the government payments, and bring in pharmaceutical manufacturing whistleblower lawyers who understand quality systems and False Claims Act cases. We stay alongside you as your inside knowledge becomes the foundation of the case.