Medtronic Pays $23.5M To Settle Kickback Charges

Medtronic Pays $23.5M To Settle Kickback Charges

December 14th, 2011 // 1:08 pm @

In the latest instance in which a medical products company has bellied up to the bar to resolve kickback charges, Medtronic has agreed to pay $23.5 million to settle whistleblower claims that doctors were paid off through post-marketing studies and device registries to implant pacemakers and defibrillators. The kickbacks led to fraudulent Medicare and Medicaid billings, according to the feds.

The device maker collected data and info from participating docs, but each of two studies and two registries required a new or previous implant of a Medtronic device in each patient, according to the US Department of Justice, which notes that Medtronic paid participating docs fees that ranged from about $1,000 to $2,000 per patient. The goal, the feds charged, was to take business from rivals.

The theme is largely similar to kickback allegations raised against various drug and device makers over the years. Recently, for instance, the Genentech unit at Roche and Pfizer resolved such charges ( see this and this, and Amgen set aside nearly $800 million to settle such claims (read here). Over the past three years, the feds also reached settlements with Boston Scientific and St. Jude Medical.

The Medtronic settlement resolves allegations contained in two whistleblower lawsuits filed under the qui tam provisions of the False Claims Act that are pending in Minnesota and California. As part of the settlement, the whistleblowers will receive payments totaling more than $3.96 million from the federal share of the recovery (here is a statement from the Justice Department. We will provide links to documents when they become available).

Medtronic, you may recall, has been enmeshed in controversy over Infuse, a genetically engineered protein that has been widely used in spinal surgeries. Various investigations began after reports detailed that doctors with financial ties to the device maker were aware of serious problems with Infuse, but never disclosed potential health complications in published studies.

In a highly unusual move, a medical journal earlier this year devoted an entire issue to dissecting the frenzy surrounding Infuse. The Spine Journal reviewed 13 studies previously published elsewhere and discovered that side effects – such as cancer, sterility, infections and dissolving bones – were downplayed or omitted (read this).

“Medtronic is happy to have this investigation behind us, so we can continue designing and executing clinical trials that generate evidence to improve patient care, outcomes, and cost effectiveness,” Marshall Stanton, vp of clinical research and reimbursement for the Medtronic cardiac and vascular group, said in a statement.


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