Paxil Class Action Settlement Approved for $40 Million

GlaxoSmithKline has agreed to pay $40 million to settle a Paxil class action lawsuit, which claims that the drug maker promoted the antidepressant for use in children without disclosing information about Paxil side effects and evidence that the drug is not effective in kids. The Paxil settlement will refund insurers for benefits paid for use of the drug by children and teenagers.

Paxil, known generically as paroxetine, is a selective serotonin reuptake inhibitor prescribed to treat depresion. It was originally approved in 1992, and has become one of the most commonly prescribed drugs in the United States.

The FDA has never approved Paxil for use by children, but it has been widely prescribed “off-label” to treat depression in people under 18.

Although they have denied wrongdoing, Glaxo has faced government investigations about their promotion of the drug and claims that they withheld information about the safety and efficacy of Paxil for children.

Research has suggested that Paxil is not effective for kids, and it could increase the risk of suicidal behavior.

The Paxil class action lawsuit was filed on behalf of over 40,000 health insurers that made payments for prescriptions of the antibiotic to children between January 1998 and December 2004. Under the terms of the Paxil settlement, insurers are entitled to reimbursement of 40% of their payments for prescriptions to children and teenagers diagnosed with a major depression, or 15% of the cost if the diagnosis was unknown.

In 2007, Glaxo agreed to settle a similar consumer Paxil lawsuit for $63.9 million. Under that settlement, parents who purchased Paxil or Paxil CR for their child were entitled to recover money spent on the drug. Without a receipt, parents were entitled to receive up to $100, and with documentation on how much was spent, they were able to receive up to the entire amount.

Although these settlements end the lengthy Paxil litigation surrounding the use of the drug by kids, the drug maker continues to face a number of lawsuits filed on behalf of infants who were born with birth defects after their mothers took the drug during pregnancy.

Paxil birth defect lawsuits have been filed that allege Glaxo failed to properly warn about side effects which could cause women to give birth to children with certain heart defects, abnormal skull development, gastrointestinal abnormality and brain defects.