Ex-Medtronic Employees File Whistleblower Lawsuit
BY LAUREN UZDIENSKI, JULY 31, 2008
Two former Medtronic employees filed a qui tam lawsuit in a Boston federal court, alleging that more than 100 spine surgeons, neurosurgeons and distributors colluded with Medtronic to defraud Medicare and accepted kickbacks from the company. These are the same plaintiffs that brought a 2006 lawsuit against Medtronic, also alleging kickbacks. That case was settled for $40 million.
The suit alleges violations of the False Claims Act dating back to at least 2002. Much of the focus is on the off-label use of InFuse; while the product is FDA-cleared in spine for single-level anterior fusions, it is often used off-label (recent published data identified some of the dangers of off-label use). The lawsuit alleges that claims submitted to Medicare for off-label use were fraudulent. Additionally, the suit says that certain physicians promoted off-label use at conferences and CME events.
Kickbacks are another focus of the suit. The filing identifies the dollar value of "sham consulting agreements" Medtronic had with individual physicians, totaling in excess of $8 million in 2006. The suit adds that patents were also used as a form of kickback.
The previous suit was resolved for a relatively inconsequential sum of money ($40 million, compared to Medtronic's spinal division revenue of more than $2 billion), so it's possible that this case will meet a similar outcome. Regardless of whether or not there's a settlement, this does show that scrutiny of the physician-industry relationship is not receding following last year's DOJ settlement.
