Glaxo to record a charge over marketing probe

GlaxoSmithKline P.L.C. will record a $400 million charge in the fourth quarter of 2008 related to an investigation into its sales and marketing practices, the latest in a string of drug companies to do so.

The charge created uncertainty about the company's earnings report next week and pushed its shares down 3.82 percent to close today at $34.75.

The Colorado U.S. Attorney's Office is investigating Glaxo's marketing of drugs for uses not approved by the U.S. Food and Drug Administration, the company said. The federal government is also looking into payments to doctors for speaking fees, medical education and other services, the company has said.

Glaxo is based in London, but it employs several thousand people in the Philadelphia area.

Glaxo said the investigation was related to sales and marketing practices for nine of its best-selling drugs from 1997 through 2004, but it did not name all of them. In its annual report, the company said federal investigators had asked for information about the company's alleged promotion of Wellbutrin SR, a drug approved for depression, but often prescribed for bipolar disorder, an unapproved use.

Companies are not allowed to promote drugs for unapproved uses, although doctors can prescribe as they see fit.

In the last two weeks, Pfizer Inc. agreed to pay $2.3 billion to settle charges by the federal government that it had illegally marketed its pain reliever Bextra, and Eli Lilly & Co. said it would pay $1.4 billion over allegations that it illegally marketed its antipsychotic drug Zyprexa to the elderly.