Federal prosecutors have said they plan to become a plaintiff in a 4-year-old False Claims Act case against devicemaker St. Jude Medical, which is accused of paying illegal kickbacks to surgeons who used the company's pacemakers and defibrillators.
Feds to join suit against St. Jude Medical
Officials with the U.S. attorney’s office in Boston late last week filed a memorandum in U.S. District Court in Boston in support of a whistle-blower case filed in July 2006 by former St. Jude employee Charles Donigan. The devicemaker, according to Donigan’s civil complaint, violated false claims law because hospitals and physicians that received the kickbacks then billed Medicare and Medicaid for reimbursement of services.
In his complaint, which was also filed with the U.S. District Court in Boston, Donigan alleges that St. Jude promoted sales of its cardiac devices through several kickback vehicles. They included giving free equipment to hospital customers under the guise of a fake rebate program, using four post-market clinical trials to funnel cash payments to doctors who used the company’s devices, and paying for physicians to take lavish trips and attend events.
In a statement, St. Jude said that it objected to the government’s motion to intervene, and that it would “vigorously defend against the allegations in the lawsuit.”
Under the False Claims Act, the government can file an action to intervene, thereby becoming a plaintiff on a case when federal investigators determine the civil case has good cause. Prosecutors plan to file a federal complaint against St. Jude Medical on or before Aug. 31, according to the memorandum of support.
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