GlaxoSmithKline said it will take a fourth-quarter legal charge of about $3.5 billion to cover the cost of a government investigation into its sales and marketing practices, as well as future product-liability cases related to diabetes drug Avandia. The lion's share of the $3.5 billion charge, which knocks out GSK profit for the quarter, will go toward settling a US
investigation into GSK sales and marketing practices between 1997 and 2004 that includes nine products. Although the original subpoena was
issued from the US Attorney's office in Colorado, the scope of that
inquiry is nationwide. GSK said the charge is also being set aside for likely future Avandia legal claims, plus those received since last July, when the firm said it recorded a $2.4-billion charge in last year's second quarter to settle litigation related to Avandia and antidepressant Paxil, and to settle a US government inquiry of its now-closed factory in Cidra, Puerto Rico.