Medical Device Manufacturer Biotronik Inc. Agrees To Pay $12.95 Million To Settle Allegations of Improper Kickback Payments to Physicians
Seattle Whistleblower Attorneys report that Oregon based Biotronik Inc. (Biotronik), a medical device manufacturer agreed to pay $12.95 million to resolve allegations that it violated the False Claims Act by causing the submission of false claims to Medicare and Medicaid by paying kickbacks to physicians to induce their use of Biotronik’s implantable cardiac devices, such as pacemakers and defibrillators.
The Federal Anti-Kickback Statute prohibits offering or paying anything of value to induce referrals of items or services covered by Medicare and other federally funded programs. The statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives.
The settlement announced today resolves allegations that Biotronik engaged in a kickback scheme to pay certain favored physicians to induce and reward their use of Biotronik’s pacemakers, defibrillators and other cardiac devices. In particular, Biotronik allegedly abused a new employee training program by paying physicians for an excessive number of trainings and, in some cases, for training events that either never occurred or were of little or no value to trainees. Biotronik allegedly made these payments despite concerns raised by its own compliance department, which warned that salespeople had too much influence in selecting physicians to conduct new employee training and that the training payments were being over-utilized. The settlement also resolves allegations that Biotronik violated the Anti-Kickback Statute when it paid for physicians’ holiday parties, winery tours, lavish meals with no legitimate business purpose and international business class airfare and honoraria in exchange for making brief appearances at international conferences.
The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Jeffrey Bell and Andrew Schmid, both of whom were previously employed as independent sales representatives for Biotronik. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. Mr. Bell and Mr. Schmid will receive approximately $2.1 million as their share of the recovery in this case. The qui tam case is captioned United States ex rel. Bell, et al. v. Biotronik, Inc. et al., No. 2:18-cv-1895 (C.D. Cal.).
The claims asserted in the United States’ complaint are allegations only, and there has been no determination of liability.
Source: Dept. of Justice
The Federal Anti-Kickback Statute prohibits offering or paying anything of value to induce referrals of items or services covered by Medicare and other federally funded programs. The statute is intended to ensure that medical providers’ judgments are not compromised by improper financial incentives.
The settlement announced today resolves allegations that Biotronik engaged in a kickback scheme to pay certain favored physicians to induce and reward their use of Biotronik’s pacemakers, defibrillators and other cardiac devices. In particular, Biotronik allegedly abused a new employee training program by paying physicians for an excessive number of trainings and, in some cases, for training events that either never occurred or were of little or no value to trainees. Biotronik allegedly made these payments despite concerns raised by its own compliance department, which warned that salespeople had too much influence in selecting physicians to conduct new employee training and that the training payments were being over-utilized. The settlement also resolves allegations that Biotronik violated the Anti-Kickback Statute when it paid for physicians’ holiday parties, winery tours, lavish meals with no legitimate business purpose and international business class airfare and honoraria in exchange for making brief appearances at international conferences.
The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Jeffrey Bell and Andrew Schmid, both of whom were previously employed as independent sales representatives for Biotronik. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. Mr. Bell and Mr. Schmid will receive approximately $2.1 million as their share of the recovery in this case. The qui tam case is captioned United States ex rel. Bell, et al. v. Biotronik, Inc. et al., No. 2:18-cv-1895 (C.D. Cal.).
The claims asserted in the United States’ complaint are allegations only, and there has been no determination of liability.
Source: Dept. of Justice