By Phil Serafino and Makiko Kitamura
Bloomberg News
Negotiations over the terms will be completed next year, the London-based company said in a statement today. The cost is covered by existing legal provisions and will be paid from the company’s cash resources, Glaxo said.
The potential settlement brings Glaxo closer to putting years of legal probes behind it. The company set aside 2.2 billion pounds ($3.5 billion) in the fourth quarter last year in anticipation of reaching an agreement on the cases. Glaxo said it will have about 1 billion pounds of its 2.9 billion pounds in total legal provisions remaining after today’s settlement is completed, and it hasn’t decided what to do with the money.
“This news essentially draws a line under a 10-year legal saga,” Gbola Amusa, an analyst at UBS AG in London who recommends buying Glaxo shares, said in an e-mail. “This removes significant uncertainty on ongoing legal issues.”
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