BUSINESS BRIEFS
Merck settling fraud charges for $671 million
Associated Press
TRENTON, N.J. — In one of the biggest U.S. health care fraud settlements ever, Merck & Co. will pay $671 million to settle claims it overcharged the government for four popular drugs and bribed doctors to prescribe its drugs, federal prosecutors said yesterday.
The alleged overcharges, dating to the mid-1990s, involved Medicaid programs in the District of Columbia and every state but Arizona, as well as federal health-insurance programs at agencies.
A nationwide investigation by federal prosecutors was triggered in 2000 by a former Merck salesman-turned-whistleblower and broadened by a Louisiana doctor who also exposed overcharging.
BRITISH GET RATE CUT, EU DOESN'T
LONDON — The Bank of England lowered rates by a quarter of a percentage point to 5.25 percent.
The European Central Bank, however, held steady at 4 percent for the euro zone — a bloc of more than 318 million people that accounts for more than 15 percent of the world's gross domestic product.
FOUR U.S. AIRLINES IN MERGER TALKS
CHICAGO — Four major U.S. carriers, including United Airlines, appear closer to consummating deals that would radically remake the airline industry, say people close to the airlines.
Chicago-based United is in merger talks with Continental Airlines and is poised to seal its deal if Delta Air Lines and Northwest Airlines combine first, sources say.
The deals could be announced in rapid succession as early as this month, provided carriers are able to resolve a host of issues, ranging from fights over how to share the executive suite to offering concessions to labor.
PEPSICO'S PROFIT PLUNGES 31%
NEW YORK — PepsiCo Inc., the world's second-largest soft drink maker, said yesterday its fourth-quarter profit fell 31 percent from a year earlier, when results were boosted by a tax benefit. Without the benefit, earnings rose 8 percent.
The $602 million tax benefit — which added $128 million, or 36 cents per share, to the 2006 bottom line — was the result of a settlement with the Internal Revenue Service over a review of 1998-2002 returns.
The company, which also owns the Frito-Lay snacks business, said it expects earnings and revenue growth in 2008.
CONSUMERS LESS LIKELY TO BORROW
WASHINGTON — Consumers increased their borrowing in December at the slowest pace in eight months, additional evidence that economic activity was slowing significantly at the end of last year. For all of 2007, consumer credit rose at the fastest clip in three years.
The Federal Reserve reported yesterday that consumer borrowing rose at an annual rate of 2.1 percent in December, a sharp slowdown from an 8.2 percent jump in November. It was the weakest showing since credit had increased just 1.6 percent in April.
