The question of when U.S. federal attorneys can dismiss a whistleblower suit filed under the False Claims Act (FCA) has roiled the courts for several years, but the Supreme Court has laid many of those questions to rest in an 8-1 ruling which said that the government can dismiss a whistleblower FCA case only after federal attorneys have intervened.
With False Claims Act (FCA) whistle-blower lawsuits multiplying amid the complexity of regulations that often are unclear, the U.S. Supreme Court provided some clarity as to what constitutes a false claim in a unanimous opinion handed down June 1. But it’s not what the biopharma and med-tech industries were hoping for.
The Advanced Medical Technology Association (Advamed) and the Biotechnology Innovation Organization (BIO) have teamed up on a friend-of-the-court brief for the U.S. Supreme Court’s upcoming hearing on twin cases that examine the question of a defendant’s state of mind when filing claims with federal health programs. Advamed and BIO argue that the existing judicial approach is critical to ensuring that companies in the life sciences are not subject to treble damages when acting reasonably in connection with products reimbursed by federal health programs, adding that an overturn of existing judicial practice would stifle innovation at the cost of patient access to life-saving medical therapies.
The False Claims Act is perhaps the primary vehicle for U.S. federal authorities to extract penalties and fines from life science companies for violations of the law, but a new report by Gibson Dunn & Crutcher LLP suggests a mixed signal. The report notes that the U.S. Department of Justice (DOJ) recovered $2.2 billion via the FCA last year, but while that is not a conspicuous number for the past decade plus, what was conspicuous was that those sums were recovered by the second highest level of FCA actions settlement in the history of the FCA, suggesting that DOJ is keen on enforcement with no regard to the size of the target.
The False Claims Act (FCA) is perhaps the primary vehicle for U.S. federal authorities to extract penalties and fines from life science companies for violations of the law, but a new report by Gibson Dunn & Crutcher LLP suggests a mixed signal. The report notes that the U.S. Department of Justice (DOJ) recovered $2.2 billion via the FCA last year, but while that is not a conspicuous number for the past decade plus, what was conspicuous was that those sums were recovered by the second highest level of FCA actions settlement in the history of the FCA, suggesting that DOJ is keen on enforcement with no regard to the size of the target.
More than one U.S. federal government agency is tasked with keeping track of fraud and abuse of federal health programs, but a new report by the Government Accountability Office (GAO) suggests there is more work to be done. The GAO report said that one of the key issues with fraud and abuse writ broadly is that the terms and definitions are used inconsistently, and that a fix for this and other problems might capture more fraud, which may in turn indirectly put more medical device makers at risk for such allegations.
Depuy Synthes Inc., of Raynham, Mass., has agreed to pay $9.75 million to settle allegations that several members of its sales team had induced an orthopedic surgeon to use the company’s products in orthopedic procedures by offering free implants and surgical instruments. The fine comes under the guise of a False Claims Act violation but might have been substantially larger but for the fact that Depuy reported the issue to federal authorities.
The U.S. Department of Justice (DOJ) reported an indictment of three men alleged to have filed more than $100 million in genetic testing false claims directly or indirectly with the Medicare program. Two of the three defendants face as many as 65 years of incarceration if convicted, a clear sign that federal government agencies in the U.S. are more intent than ever on cracking down on fraud and abuse of federal health programs.
U.S. federal enforcement of the False Claims Act (FCA) violations tends to produce some outsized penalties, but the department isn’t shy about slapping six-figure fines on the smaller inhabitants of the med-tech space. DOJ reported that Schwenksville, Pa.-based Jet Medical Inc. and two affiliated companies will pay more than $745,000 to settle claims that Jet had introduced a nerve block device into interstate commerce without the FDA’s approval, a move that often draws the attention of federal government authorities other than the FDA.
The U.S. Department of Justice (DOJ) reported that it has arrived at a settlement of $45 million with Boca Raton, Fla.-based Modernizing Medicine Inc., an electronic health record (EHR) vendor that was accused of inducing referrals to a clinical lab for pathology services. The department stated that this settlement was the fourth such action against EHR vendors and is part of a concerted DOJ effort to “root out fraud” in the field, a signal that more enforcement against these companies is in the works.
