GSK Plc GSK has been reportedly sued by an independent Connecticut laboratory, Valisure, accusing the pharmaceutical giant of defrauding the U.S. government and taxpayers by concealing cancer risks associated with Zantac, once a blockbuster heartburn drug.
In a whistleblower complaint filed on Monday, Valisure claimed GSK violated the federal False Claims Act by hiding these risks for nearly four decades while Medicare, Medicaid, and other health programs covered billions of dollars in prescriptions.
Valisure's 2019 testing revealed that Zantac, also known as ranitidine, could form a cancer-causing carcinogen called NDMA, making it "unfit for human consumption."
The lab accused GSK of concealing this information from the FDA, which approved Zantac in 1983.
In a complaint filed in Philadelphia, where some of GSK's operations are based, Valisure seeks billions of dollars in damages from GSK, including civil fines of up to $11,000 per violation.
Citing GSK, Reuters noted that the company would defend against Valisure's meritless lawsuit, emphasizing that the FDA found Valisure's tests "scientifically flawed and unreliable."
The False Claims Act allows whistleblowers to sue on behalf of the federal government and share in recoveries. Valisure initially sued GSK on behalf of the United States and more than two dozen states in 2019 in a case filed under seal.
However, the federal government declined to join the lawsuit in March, leaving Valisure to pursue the case independently.
More than 70,000 private lawsuits over Zantac remain pending in U.S. courts, with most in a Delaware state court, where a judge decides if the cases can proceed.
Reuters added that the first trial over Zantac's alleged link to cancer began this month in Chicago and may conclude this week.
Earlier this month, Pfizer Inc PFE agreed to pay up to $250 million to resolve thousands of Zantac-related lawsuits.
This settlement, revealed in a Delaware court filing, aims to decrease Pfizer's potential liability substantially.
Price Action: GSK shares are up 0.05% at $44.61 at last check Tuesday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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