US INVESTIGATIONS have resulted in huge payouts by two major firms – drugmaker Elan, and the bank Goldman Sachs. The companies were fined a whopping $750 million combined after separate investigations by US officials.
Irish pharmaceutical company Elan will pay a $200 million fine to settle claims arising from a US investigation into how the company marketed its Zonegran medicine. The anti-epileptic drug was sold off by Elan in 2004, and the company had set aside $206 million to cope with costs expected to arise from the probe.
The company is also expected to plead guilty to violating the US Federal Food, Drug and Cosmetic Act, but specific details on the infraction were not released.
US bank Goldman Sachs has agreed to pay $550 million in compensation to settle a fraud action by US regulators against the company. Regulators accused the bank of misleading investors in subprime mortgage products just as the housing market began to collapse.
They said Goldman Sachs had allowed a hedge fund to package subprime mortgages for their clients while simultaneously betting against those packages. The fine is unlikely to have much financial impact on the company, which earned $13.3 billion last year.