Irish drugmaker Shire has agreed to pay a multi-million dollar fine to the US Justice Department to settle allegations that it overstated the efficacy of five drugs, including its attention deficit disorder (ADHD) drugs Adderall XR and Vyvanse.
Shire Pharmaceuticals LLC, a unit of Dublin-based drugmaker Shire PLC, will pay $56.5m (£34.5m, €44m) to settle the case – $35.7m to the federal government and $20.8m to state Medicaid programmes. The company will make an additional payment of $2.9m to the state of Louisiana.
The company did not admit any wrongdoing from its part as part of the settlement.
The unit was earlier accused of violating the False Claims Act from 2004 to 2007, as it promoted Adderall saying ADHD patients who took the drug would be "indistinguishable" from people who do not have the condition.
The company also promoted the drug saying it would prevent poor academic performance, loss of employment, criminal behaviour, traffic accidents and sexually transmitted disease.
In addition, Shire allegedly marketed Adderall as a treatment for conduct disorder, while it does not have the approval to do so.
Shire has faced similar allegations in connection with its other products such as Vyvanse, Daytrana patch and ulcerative colitis treatment Lialda.
Vyvanse sales amounting to $359.5m in the second quarter represent about 25% of the company's total revenues during the period.
The Justice Department was of the view that the claims made by Shire representatives are not backed by clinical trials.
"Shire cooperated throughout this investigation and, in advance of this settlement, began to correct its marketing activities," said US Attorney Zane David Memeger in a statement.
"We are pleased to have reached a resolution and to put this matter behind us," CEO Flemming Ornskov said.
"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 recently announced its merger with US-based peer AbbVie in a deal valued at about $55bn. The new company will be based in Ireland in line with AbbVie's plan to benefit from tax inversion by shifting its domicile to a lower tax regime.