Oct 222013

Medical Device Manufacturer Pays $30 Million to Resolve FCA Claims

Jaime L.M. Jones

DOJ has announced a settlement agreement with medical device manufacturer Boston Scientific, alleging that its Guidant division caused the submission of false claims for two of its implantable cardiac defibrillators. The agreement, pursuant to which Boston Scientific will pay $30 million, resolves qui tam claims brought by a relator who was implanted with one of the devices. The government and relator alleged that the defendant knew of defects in the devices but failed to disclose the issues to physicians, patients, or the FDA. The case is one of an increasing enforcement trend in which the government pursues FCA claims based on allegations that the failure accurately to disclose safety or risk information regarding drugs or devices renders claims for reimbursement false.

This settlement follows the resolution in 2010 of criminal charges stemming from Guidant’s alleged failure to disclose information related to its implantable defibrillators. At that time Guidant pled guilty to two misdemeanor charges for filing a false report with FDA and failing to notify FDA about a safety correction made to one device, and agreed to pay $296 million.

Jaime L.M. Jones

Chicago

jaimejones@sidley.com

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