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 U.S. Department of Justice has been intensely focused on illicit billings to federal government agencies, so much so that the agency reclaimed more than $500 million in the first half of calendar year 2022 under the False Claims Act. However, 80% of that amount came from companies in the life sciences, a fact which combines with pending federal and state legislation to amplify the risk for these companies in the coming years, according to a new report by the law firm of Gibson Dunn & Crutcher, LLP.
Drug and device makers are necessarily wary of any activities that could lead to prosecution under the False Claims Act (FCA), but seemingly innocuous activities are now fair game for federal prosecutors. The latest example is the FCA prosecution of Caris Life Sciences for filing claims for cancer tests outside the 14-day post-discharge window, and Mark Gardner, directing attorney at Gardner Law of Stillwater, Minn., told BioWorld that device makers should be on the alert because it appears that federal authorities are ramping up enforcement.
Drug and device makers are necessarily wary of any activities that could lead to prosecution under the False Claims Act (FCA), but seemingly innocuous activities are now fair game for federal prosecutors. The latest example is the FCA prosecution of Caris Life Sciences for filing claims for cancer tests outside the 14-day post-discharge window, and Mark Gardner, directing attorney at Gardner Law of Stillwater, Minn., told BioWorld that device makers should be on the alert because it appears that federal authorities are ramping up enforcement.
The U.S. Department of Justice (DOJ) has filed a complaint in U.S. district court related to marketing of a pelvic muscle rehabilitation system by the Prometheus Group of Raleigh, N.C., stating that the company encouraged health care professionals to reuse rectal pressure sensors and anorectal manometry catheters on multiple patients.
Arthrex Inc., of Naples, Fla., is well known for lobbing a legal hand grenade into the inter partes review (IPR) process for patent disputes, but the company is now drawing ink for a different legal reason. According to the U.S. Department of Justice (DoJ), Arthrex has agreed to pay $16 million to settle allegations that it engaged in kickbacks to a surgeon, payments ostensibly made to pay for assistance with device design, but which the DoJ claims were intended to induce the surgeon’s use and endorsement of Arthrex products.
For the second time in less than 30 days, a company indirectly acquired by Abbott has settled with the U.S. government over alleged violations of the False Claims Act (FCA). In this instance, the now-defunct Arriva Medical LLC and its parent company Alere Inc. have agreed to pay $160 million to settle allegations that Arriva caused false Medicare claims to be filed for glucometers.
The U.S. Department of Justice (DoJ) has settled with two divisions of Abbott Laboratories of Abbott Park, Ill., over violations of the False Claims Act (FCA) in connection with devices alleged to have been defective. While neither claim recites a specific allegation against corporate executives with St. Jude Medical and Alere, the more conspicuous aspect of these agreements is that they are both directed toward activities that ceased in 2016, making clear that federal attorneys have long memories where problematic devices are concerned.
