Recently, Medtronic paid the government over $23.5 million to quiet allegations that it violated the False Claims Act by using physician payments related to post-market studies and registries to induce physicians to implant the company’s pacemakers and defibrillators. These allegations mirrored a prior False Claims Act recovery, in which St. Jude Medical paid the government $16 million, in a case that alleged that St. Jude attempted to induce selection of its devices, by paying healthcare providers for the collection of data in connection with post-market clinical studies of the company’s products.
There are legitimate reasons for conducting post-market studies. However, when a pharmaceutical or medical device manufacturer uses these studies to pay healthcare providers for the purpose of influencing their medical judgment, the payments likely run afoul of the Anti-kickback Statute and the False Claims Act. Pharmaceutical companies have also utilized this tactic. Just a few years ago, our Firm successfully closed out a case with allegations which included, among others, payments to physicians under the guise of a registry for the prescription drug Natrecor. As a result, Johnson & Johnson and one of its subsidiaries, paid $184 million in settlement of that case.
More information for whistleblowers is located at the Nolan Auerbach & White website.