ALEX KACIK / August 23, 2019
A recent False Claims Act lawsuit claiming that a medical device company paid kickbacks to doctors illustrates an increasingly tenuous arrangement that may spur more whistleblower cases.
The Department of Justice intervened in the whistleblower suit against Life Spine seeking millions of dollars of damages for allegedly paying kickbacks in the form of consulting fees, royalties and intellectual property acquisition fees to induce physicians to use the manufacturer’s spinal implants, devices and equipment.
The doctors who received these payments accounted for about half of the Huntley, Ill.-based company’s domestic sales of spinal products from 2012 through 2018, the lawsuit claims. Life Spine would allegedly recruit surgeons who could use a high volume of its products and pay them to train other doctors, provide input on products and transfer their patents to Life Spine. The device manufacturer tied the payments to utilization, according to the suit.
Life Spine said in a statement that both parties are engaged in discussions and look forward to resolving the matter.
“This may be the tip of the iceberg for spinal FCA cases,” said Mark Silberman, a partner in Benesch’s healthcare and life science group who has served as a state and federal prosecutor. “I feel confident this is not the last notable case we will see.”