GSK settles Avandia cases for $60m

GlaxoSmithKline (GSK) has agreed to pay around $60m to settle the first lawsuits alleging its Avandia (rosiglitazone) causes heart attacks and strokes in some patients.

According to people familiar with the case, the settlement would resolve more than 700 lawsuits related to the diabetes drug. Around 4,000 cases are yet to follow and GSK will face its first trial in a state court in Philadelphia, US, in July.

The US Food and Drug Administration (FDA) approved Avandia for sale in the US in 1999 and the drug amassed sales of $3bn by 2006, including sales of a combination of Avandia and another drug.

But in May 2007, the drug was linked to a 43 per cent increased risk of heart attacks and sales plummeted. Avandia was the world's best-selling diabetes pill before safety concerns emerged.

Analysts have predicted that GSK may face as much as $6bn in liability related to Avandia and there's a risk that US regulators may force the drug to be removed from the the market. The $60m settlement has been viewed positively by the market as it minimises risk.

The FDA is currently reviewing new and existing cardiovascular safety data of Avandia and expects to present an updated assessment of the risk and benefits of the drug at an advisory meeting scheduled for July.