Shire has agreed to pay a total $56.5 million to the U.S. federal government and the governments of all 50 states and District of Columbia to settle civil claims arising from whistleblower lawsuits that the company engaged in false and misleading claims about five of its drugs mismarketed between 2004 and 2010.

The federal government alleged that between January 2004 and December 2007, Shire promoted one of its ADHD drugs, Adderall XR, for uses beyond its indication despite lacking clinical data to support such uses, and overstated Adderall XR’s efficacy compared with other ADHD drugs. The government cited claims that Adderall XR would “normalize” its recipients, rendering them indistinguishable from their non-ADHD peers—results the company is alleged to have said could not be achieved with competitors’ products and was not shown in Shire clinical data. 

The federal claims also accused Shire of marketing Adderall XR based on unsupported assertions that Adderall XR would prevent poor academic performance, loss of employment, criminal behavior, traffic accidents, and sexually transmitted disease.  Shire was also accused of promoting Adderall XR for the treatment of conduct disorder without FDA approval.

Between February 2007 and September 2010, the federal government alleged, Shire sales representatives and other agents made false and misleading statements about the efficacy and “abuseability” of another ADHD drug, Vyvanse, to state Medicaid formulary committees and to individual physicians. 

U.S. attorneys cited an unnamed Shire medical science liaison who is alleged to have told a state formulary board that Vyvanse “provides less abuse liability” than “every other long-acting release mechanism” on the market—despite the absence of studies establishing that claim, and despite an FDA-mandated black box warning for its potential for misuse and abuse since it is an amphetamine product. Shire was also alleged to have claimed that treatment with Vyvanse would prevent car accidents, divorce, arrests, and unemployment, without supporting clinical data.

According to the Justice Department, the settlement also resolves allegations that Shire representatives between April 2006 and September 2010 improperly marketed a third ADHD drug, Daytrana, as less abuseable than traditional, pill-based medications because it is administered through a patch. For part of the period, the Department of Justice claims, Shire reps wrongly induced physicians to prescribe Daytrana and Vyvanse by assisting them with the process of seeking prior-authorization through improper phone calls and letters to state Medicaid authorities. 

Finally, the settlement resolves allegations that, Shire sales representatives promoted the mild- to moderate- active ulcerative colitis drugs Lialda and Pentasa for off-label uses not approved by FDA and not covered by federal healthcare programs between January 2006 and June 2010. Lialda, for example, was promoted by Shire off-label for the prevention of colorectal cancer, the federal government contended.

“Our agency will continue to hold drug companies responsible for seeking to boost profits using false and misleading claims about products, such as the powerful medications prescribed to children and other drugs at issue in this settlement,” Gregory E. Demske, chief counsel to the U.S. Department of Health and Human Services Inspector General Daniel R. Levinson, said in a Department of Justice statement.

The claims first surfaced in a lawsuit by former Shire executive Gerardo Torres, M.D., and a separate suit filed by three former Shire sales representatives, Anita Hsieh, Kara Harris and Ian Clark.  The lawsuits were filed under the False Claims Act’s whistleblower provisions, which permit private parties to sue for false claims on behalf of the government and to share in any recovery. 

Dr. Torres, former vp and scientific lead of Shire's ADHD Business Unit, will receive $5.9 million, the Department of Justice said.

The lawsuits are captioned United States ex rel. Torres v. Shire Specialty Pharmaceuticals, et al., No. 08-4795, filed in U.S. District Court for the Eastern District of Pennsylvania; and United States ex rel. Hsieh, Harris, and Clark v. Shire PLC, et al., No. 09-6994, filed in U.S. District Court for the Northern District of Illinois.

Of the settlement’s $56.5 million, Washington will receive $35,713,965, while the remaining $20,786,034 will be divided among state Medicaid programs, since Medicaid is jointly funded by the federal and state governments. The fine is not large enough to be among the Top 10 Biggest Biopharma Marketing Fines as tallied by GEN in its annual list.

Additionally, Shire will pay $2.9 million to the State of Louisiana to resolve a previously disclosed civil complaint alleging that the Company’s sales, marketing, and promotion of Adderall, Adderall XR, Daytrana, Vyvanse, and another ADHD treatment, Intuniv, violated state law.

As part of the federal settlement, disclosed yesterday, Shire has entered into a corporate integrity agreement with the Department of Health and Human Services-Office of the Inspector General designed to address the company’s future marketing efforts over five years. Well before then, Shire hopes to have been acquired by AbbVie for about £32 billion (about $52.2 billion), in a tax-slicing “inversion” deal that would move the company’s headquarters out of the U.S.

The agreement requires “comprehensive” compliance safeguards, oversight of Shire promotional activities, and compliance certifications from Shire’s board of directors and management, Demske added.

“The company has had, and will continue to have, a comprehensive compliance program and internal controls to ensure we comply with applicable laws and regulations,” Shire CEO Flemming Ornskov, M.D., said in a statement. “We are pleased to have reached a resolution and to put this matter behind us.”

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