Boston Scientific, Natick, Mass., agreed to pay $9.25 million to resolve a False Claims Act lawsuit (PDF) filed eight years ago by a former employee who said the company's Guidant subsidiary inflated the cost of replacement pacemakers and defibrillators to federal healthcare programs.
Boston Scientific to settle false-claims case
The U.S. Justice Department alleged that from 1981 to 2007, the company failed to grant appropriate credits and overstated the costs of the devices that failed under warranty, causing the Veterans Affairs Department, Defense Department, Medicare and Medicaid to overpay.
“Boston Scientific has denied the allegations but is pleased this settlement resolves all claims in the case,” Denise Kaigler, senior vice president of corporate communications, said in an e-mailed statement. The settlement agreement stipulates that position and that the company does not admit liability by settling. Boston Scientific acquired Guidant in 2006.
Robert Fry, a Guidant sales agent from 1981 to 2002 according to court records, filed the lawsuit in Nashville in 2003. The Justice Department joined the case in 2006. Fry is set to receive $2.3 million from the settlement payment.
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