GlaxoSmithKline paid for American psychiatrists to enjoy luxury weekends in Hawaii as it illegally sought to persuade them to prescribe an anti-depressant drug for children, US authorities alleged, as they handed the UK drugs company fines totalling a record 3 billion dollars (1.9 billion pounds). The historic penalty came as Britain’s biggest drugmaker admitted to mis-promoting two medicines, Paxil and Wellbutrin, in the US between 1998 and 2003. The settlement also saw Glaxo admit that it failed properly to report all the necessary safety data to US regulators concerning Avandia, a diabetes drug, between 2001 and 2007. The settlement ends a seven-year investigation into Glaxo’s mis-promotion of medicines in the US, which is the company’s largest research centre after Britain and home to almost a fifth of its 100,000 employees. Glaxo warned shareholders last November that it had put aside more than 2 billion pounds to pay for the settlement, The Telegraph reports.
Finland, one of the Eurozone’s few remaining AAA-rated economies, has pledged to block Brussels’ celebrated plans to allow its new bail-out fund to buy sovereign bonds in the market. A Finnish government report on last week’s milestone European Summit showed that prime minister Jyrki Katainen opposed plans to give the European Stability Mechanism (ESM) the option to buy government bonds in the secondary market. On Monday a spokesman said Finland’s stance was supported by the Netherlands too. Under the current rules, Finland is ultimately too small to prevent Brussels from deploying the bail-out funds single-handedly but its opposition is a blow to leaders who are desperate to present a united crisis-fighting front, The Telegraph explains.
Europe’s biggest aircraft manufacturer is about to park in Boeing’s back yard after announcing that it will build its first assembly factory in the United States. Airbus will spend $600m on a new facility in Mobile, Alabama, that will create more than 1,000 jobs. The assembly line will remove one of Boeing’s key competitive advantages in bidding for aircraft orders in the United States because now both companies will be able to claim that they are supporting American jobs. Airbus estimates that the US aircraft market will be worth about $600bn over the next two decades and it wants to break Boeing’s stranglehold over the country’s domestic airlines, The Telegraph reports.
An index of US manufacturing activity unexpectedly fell to 49.7 in June from 53.5 in May, the Institute for Supply Management said yesterday. A reading below 50 signals contraction and last month’s figure was lower than the most pessimistic forecast. The Dow Jones and the S&P 500 both fell as investors took the report as further confirmation that the world’s largest economy is losing the momentum it enjoyed at the start of the year. “It’s a really terrible number,” said David Semmens, an economist at Standard Chartered, according to The Telegraph.
Gordon Brown and his senior lieutenants face questioning about their roles supervising the City after George Osborne announced a parliamentary inquiry into the future of banking. Ed Balls and Baroness Vadera emerged as likely witnesses along with the former Prime Minister as political divisions deepened over the banking scandal. Andrew Tyrie, the Conservative chairman of the Commons Treasury Select Committee, will lead a cross-party commission of MPs and peers examining the culture and professional standards of banking. It will make recommendations by Christmas about how to repair the reputation of Britain’s banks; Mr Osborne said that he would be ready to speed these into law next spring, writes The Times.
François Hollande was told yesterday that he must cut up to €43bn from French government spending in order to meet deficit targets in a wake-up call that signalled the end of the presidential honeymoon only eight weeks after his election. The warning from the Cour des Comptes, the French audit office, came as figures showed that unemployment had exceeded 10% in France and reached its highest levels on record in the Eurozone, with 17.56 million out of work in the 17 nations, The Times reports.
Up to 100,000 customers of Ulster Bank are still unable to access their money, as the IT crisis that crippled the RBS network stretched into its 14th day. The problems, initially dismissed as a glitch, have almost completely been cleared up at the main RBS and NatWest banks after a 10-day struggle. But there appears little end in sight for the crisis at the sister bank, Ulster. Businesses and individuals in Northern Ireland have complained about the difficulties of running out of cash and being treated like “second-class citizens”. The Belfast-based bank, which also has branches in Ireland, has 1.9m customers, with an estimated 100,000 unable to access their money. The chairman of RBS, Sir Philip Hampton, flew to Belfast in an attempt to mollify angry customers, The Telegraph reports.
