The U.S. Attorney’s Office for the District of New Jersey said Merit Medical Systems Inc., of South Jordan, Utah, has agreed to pay $18 million to resolve allegations that it had paid kickbacks to physician and hospitals to use the company’s products. The qui tam action was brought in the case of U.S. ex rel. Wolf v. Merit Medical Systems, Inc., which alleged that Merit over a period of six years had provided millions of dollars in advertising and marketing support to induce purchases of several embolization procedure devices. The company is said to have been advised against the practice by a former compliance officer, Charles Wolf, and the DoJ statement noted that Merit will also agree to a five-year corporate integrity agreement with the Office of Inspector General at the Department of Health and Human Services. The compliance officer, Charles Wolf, was the whistleblower and will receive $2.65 million from the settlement. Merit said in a statement that the settlement does not constitute an admission of wrongdoing.

Federal Circuit declines to overturn lower court ruling for Medtronic

The U.S. Court of Appeals for the Federal Circuit determined that a district court had acted within its discretion in abstaining from ruling on an appeal by Medtronic plc., of Dublin to dismiss a complaint related to the payment of royalties associated with a patent acquired by a Medtronic company, Warsaw Orthopedics Inc., of Warsaw, Ind. The case was on appeal from the U.S. District Court for the Northern District of Indiana, which involved a lawsuit filed by physician Rick Sasso, who had transferred two patents for orthopedic screw delivery systems to the company. Medtronic is said to have made royalty payments on the patents from 2002 to 2018, but Sasso filed suit in 2014 alleging that Medtronic was not making payments on all devices affected by the patents. A jury determined that Medtronic had breached the agreement in a $112 million verdict entered in November 2018, but Medtronic had filed a declaratory judgment action five months prior. Medtronic argued at the time that Sasso was entitled to none of the additional claimed compensation because the two patents did not apply to the products alleged to practice either or both of the patents, and Sasso responded by seeking an abstention or stay of the Medtronic motion because of a pending action in state court. The district court dismissed Medtronic’s application for declaratory judgment without prejudice because the district court was not within its authority to grant judgment on the case, stating that only state appeals courts and the U.S. Supreme Court have the authority to review the district court judgment. Medtronic had requested a reexamination of a number of claims of the two patents, which led to a cancellation of the claims covered by the patents, but the district court had determined that the PTO action was irrelevant. The Federal Circuit determined that the district court had exercised a common-sense accommodation of judgment, and thus affirmed the dismissal of the motion for declaratory judgment.

FDA stands pat on biotin interference threshold in final guidance

The U.S. FDA posted the final guidance for testing for biotin interference in in vitro diagnostics, retaining a requirement in the draft that the test developer’s evaluation should range up to 3,500 nanograms per milliliter (ng/mL) despite criticism of this set point. The draft was sparked by problems associated with the use of biotin as a binding agent for proteins in testing because of the widespread use of vitamin B7 supplements, which are blamed for torqueing test results. The Advanced Medical Technology Association said in an Aug. 13, 2019, set of comments to the docket that a now-unavailable 2017 FDA safety communication had cited a 1,200 ng/mL threshold for this purpose, adding that the draft had not explained the use of the higher threshold. The 3,500 ng/mL threshold was included in an interference guideline developed by the Clinical Laboratory Standards Institute (CLSI), although CLSI is said to have acknowledged that this set point could be reconsidered as evidence developed. The FDA final guidance acknowledges the CLSI as the provenance of the 3,500 ng/mL threshold, which is triple the expected clinical concentration. The final guidance further recommends that developers ascertain the threshold of biotin concentrations that present no interference, and that such information be included in device labeling.

CMS adds to telehealth list

The U.S. Centers for Medicare & Medicaid Services said it has expanded the list of services under the Part B fee-for-service (FFS) program that are covered as telehealth services. The addition of 11 services, the first such additions using a “new expedited process,” is immediately in effect, and includes neurostimulator analysis and programming services. Also included in this set of new additions are cardiac and pulmonary rehabilitation services, although these additions are all limited to the duration of the public health emergency (PHE) for the COVID-19 pandemic. The agency said a total of more than 135 services have been added to the Medicare telehealth list to date in the PHE, adding that more than 12 million Medicare beneficiaries received a telehealth service between mid-March and mid-August 2020.

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