Medical device manufacturers may seek to track the use and effectiveness of its products in many ways. However, the Department of Justice says that Covidien went too far by providing kickbacks for institutions that provided registry data. Authorities say that the manufacturer launched a registry to collect data regarding its mechanical thrombectomy device, Solitaire.
Soon after the U.S. Food and Drug Administration approved the device, the manufacturer began to solicit hospitals and health care institutions to provide information about use of the product and patient experiences. The company paid fees for any data input to the registry, according to the recently settled lawsuit.
Kickbacks At The Core Of The Claim
In essence, the fee structure served as a system of unlawful kickbacks to the hospitals and institutions that engaged in the registry scheme. The government says that the device manufacturer intended to induce medical providers to use their product over any devices manufactured by its competitors.
Kickbacks to doctors and hospitals are a common issue in whistleblower claims brought under the False Claims Act. The Stark Law and the Anti-Kickback Statute make it unlawful to companies to provide kickbacks to doctors and health care companies to induce sales of a specific device, product or medical service. Kickbacks are often tied to products and services that are covered to some extent under Medicare, Medicaid and other government healthcare programs.
Whistleblowers with information concerning fraudulent payment schemes or kickbacks may have the basis for a whistleblower lawsuit to help the government recover taxpayer money that has been fraudulently obtained. Whistleblowers are entitled to receive a portion of any verdict or settlement that is achieved from resolution of the lawsuit.
Whistleblower to get roughly $2M of $13M settlement
In the recent settlement, Covidien (which is now owned by Medtronic) has agreed to pay $13 million. The whistleblower who originally filed the lawsuit on behalf of the government is expected to receive slightly more than $2 million.