UPDATE 1-Medtronic settles states' probe into Infuse marketing for $12 mln

(Adds further details on settlement)

BOSTON, Dec 13 (Reuters) - Medtronic Plc has agreed to pay $12 million to resolve claims that the company engaged in a deceptive marketing strategy to promote its Infuse bone graft product used in spinal surgery, the Massachusetts attorney general said on Wednesday.

Massachusetts Attorney General Maura Healey said the settlement will resolve an investigation by her office and those in four other states related to Medtronic's promotion of Infuse, which is used to stimulate bone growth.

In court papers, Healey alleged that Medtronic sought to expand the device's market by using deceptive company-sponsored scientific literature to make false and misleading claims about its safety and superiority.

According to the lawsuit, Medtronic collaborated with doctors to publish studies that the company then disseminated downplaying side-effects and omitting discussion of adverse results.

Medtronic paid many of those doctors millions of dollars in consulting frees, Healey alleged.

"Companies cannot use deceptive practices to increase their profits, while compromising the safety and well-being of patients," Healey said in a statement.

Medtronic had no immediate comment.

Under the settlement with two Medtronic units, the company will pay $12 million to resolve an investigation by attorneys general in Massachusetts, Oregon, California, Illinois and Washington.

The accord also imposes requirements on how Medtronic promoted clinical trial information and disseminated medical journal articles related to Infuse. The company must also make Infuse trial data public on a government website. (Reporting by Nate Raymond in Boston; Editing by Chizu Nomiyama and Diane Craft)