Device makers often need the assistance of physicians to aid in device design and development, but this is a practice that comes with some legal hazards. A session held here in Boston on enforcement in the U.S. made clear that manufacturers must exercise caution in these consulting arrangements, such as documenting the need for outside help with the device, lest the manufacturer end up with a hefty, multimillion-dollar fine imposed by U.S. enforcement agencies.
The draft rule for the Medicare physician fee schedule (MPFS) for calendar year 2022 included a revised definition of the term “physician-owned distributorship,” or PODs, but the associated data collection requirements do not go into effect until January 2023. However, Amanda Johnston, managing attorney at Gardner Law of Stillwater, Minn., said recently that there is the possibility that this new definition could become a subject for enforcement action under the Anti-Kickback Statute (AKS), thus elevating the legal risks for device manufacturers who have not updated their compliance practices.
The COVID-19 pandemic encouraged a lot of things, including shoddy product quality, but a recent FDA warning letter suggests that the associated need for tests also encouraged a few operations that had less than a full commitment to quality management.
Drug and device makers that offer health care professionals opportunities to earn continuing medical education (CME) points have a fine line to walk when sponsoring those programs, but a new advisory opinion by the Office of Inspector General (OIG) at the Department of Health and Human Services seems to draw a very clear line around those programs.
Drug and device makers that offer health care professionals opportunities to earn continuing medical education (CME) points have a fine line to walk when sponsoring those programs, but a new advisory opinion by the Office of Inspector General at the Department of Health and Human Services seems to draw a very clear line around those programs.
Although Pfizer Inc. has the only drugs approved in the U.S. to treat a rare, progressive heart disease, the U.S. Court of Appeals for the Second Circuit agreed this week with the Department of Health and Human Services, and a lower court, that Pfizer’s proposed copay assistance program for middle-income Americans covered by Medicare would violate the federal Anti-Kickback Statute – even if the company has no “corrupt” intent.
The U.S. Department of Justice (DOJ) reported that Biotronik Inc., of Lake Oswego, Ore., agreed to pay $12.95 million to settle allegations that the company induced cardiologists to use the company’s devices to treat their patients. Among the allegations is that the company paid for physicians’ holiday parties and winery tours that could not be tied to a legitimate business expense.
Reliance Medical Systems LLC agreed to pay $1 million to address allegations of violation of the Anti-Kickback Statute (AKS), but the company has responded to that outcome with a blistering riposte.
Physician-owned distributorships (PODs) were the subject of concern by medical device makers and members of Congress as long as a decade ago, and recent events would seem to justify some of those fears. The U.S. Department of Justice (DOJ) announced July 1 that two owners of a POD have agreed to pay $1 million to settle claims that they paid kickbacks to other doctors to use medical devices supplied by the POD, the very kind of violation of the Anti-Kickback Statute that undergirded some of the earlier concerns about these business arrangements.
Clinical laboratories and hospitals have routine commercial interactions, and most of those are entirely legal, but this is not always the case. The Office of Inspector General (OIG) at the U.S. Department of Health and Human Services recently decreed that an arrangement in which the hospital pays the lab for blood specimen collection handling services, or a “draw fee,” would not be permissible under the Anti-Kickback Statute (AKS), reinforcing an existing understanding that such activities present a significant legal hazard for operators of clinical labs.
