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Shire Pharmaceuticals Settles False Claims Act Case

According to the Department of Justice, Shire Pharmaceuticals, LLC (“Shire”) has agreed to settle two qui tam lawsuits brought by whistleblowers alleging violations of the False Claims Act for allegedly making false and unsupported claims related to Adderall XR, Vyvanse, Daytrana, and promoting off-label uses of its drugs Pentasa, and Lialda.  According to the Department of Justice, Shire will pay $56 million to resolve the civil allegations that it violated the False Claims Act.

According to its corporate website, Shire develops and markets products for use in the fields of neuroscience, rare diseases, gastrointestinal, and internal medicine.  It has locations in 29 countries and markets its products in over 50 countries.

“Off-label” means the medication is being used in a manner not specified in the U.S. Food and Drug Administration (“FDA”) approved packaging label or insert.  In the United States, no law prohibits physicians from prescribing medications for off-label uses.  However, pharmaceutical companies are not allowed to promote a drug for off-label uses without formal FDA approval.

According to the Justice Department, former Shire employees Gerardo Torres, Anita Hsieh, Kara Harris and Ian Clark brought whistleblower lawsuits under the qui tam provisions of the False Claims Act alleging that Shire was making false and misleading claims regarding certain drugs and promoting others for off-label uses. Specifically, it was alleged that Spire promoted Adderall XR for uses unsupported by clinical data and overstated the efficacy of Adderall XR relative to other drugs used to treated attention deficit hyperactivity disorder (“ADHD”.)  In addition, the whistleblowers claimed that Shire made false and misleading statements that Vyvanse and Daytrana, other drugs used to treat ADHD, were less abuseable than other ADHD medications.

The qui tam complains also alleged that between January 2006 and June 2010, Shire’s sales representatives promoted Lialda for off-label uses. The FDA approved Lialda for the treatment of ulcerative colitis.  Allegedly, Shire promoted the use of Lialda to prevention of colorectal cancer.

Of the settlement proceeds, the federal government will receive $35,713,965 and state Medicaid programs will receive $20,786,034.  As his reward under the qui tam provisions, the initial whistleblower, Dr. Gerardo Torres, will receive approximately $5.9 million of the total settlement proceeds.

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