DePuy Synthes to pay US$9.75 million to settle surgeon kickbacks case

USA — DePuy Synthes, a subsidiary of healthcare company Johnson & Johnson has agreed to pay nearly US$10 million to settle allegations that it violated federal and state law by providing free products to a surgeon to induce him to use its products in procedures, prosecutors said.

Under the settlement with DePuy Synthes acknowledges and accepts responsibility for providing the surgeon with implants and instruments for spinal surgeries from 2013 to 2018, according to federal prosecutors.

”We have fully cooperated with the government throughout its investigation of the allegations and were credited for that cooperation in the settlement,” Johnson & Johnson said in a statement.

”This settlement avoids further lengthy legal processes. We are committed to ensuring our employees conduct business in a way that complies with our credo and with all laws and regulations.”

DePuy, headquartered in Raynham, Massachusetts, manufactures and distributes medical devices including spinal implants.

The surgeon, whose name was redacted in the agreement, performed more than 20 operations during multiple trips to Bahrain, Saudi Arabia, Kuwait, Lebanon, the United Arab Emirates, and Qatar, during which he used approximately US$1 million in DePuy products provided by company sales representatives.

The products were not paid for by the surgeon or the hospitals where the procedures were performed.

Prosecutors claimed that DePuy gave them to induce the surgeon to use the company’s products in spine surgeries performed on Medicare and Medicaid patients in Massachusetts, in violation of the Anti-Kickback Statute.

The anti-kickback statute is intended to ensure that medical providers’ decisions are based on the best interests of patients and are not influenced by improper financial incentives.

U.S. Attorney Rachael S. Rollins said in the news release that unlawful kickbacks could severely distort medical judgment as well as the market for medical devices.

The millions of patients that depend on our healthcare system deserve untainted medical decisions. This settlement reflects our commitment to stamping out illegal kickbacks.”

In other news, a federal jury in Jacksonville, Florida awarded Johnson & Johnson’s DePuy Synthes more than US$59.4 million in damages from Swedish investment firm Fidelio Capital AB and one of its companies in a patent dispute over orthopedic implants for animals.

According to a court transcript, the jury found Fidelio and St. Augustine, Florida-based Veterinary Orthopedic Implants Inc (VOI) both liable for willfully infringing DePuy Synthes’ knee-implant patents.

In a press release, VOI’s parent company, Vimian Group, whose majority shareholder is Fidelio, stated that it strongly disagrees with the verdict and will consider its options, including post-trial motions and an appeal.

According to a DePuy Synthes spokesperson, the company will “continue to defend our IP and products.”

DePuy Synthes first sued in 2018. Its amended 2021 complaint accused VOI of infringing its patents by selling plates and screws used in knee surgery for dogs and other animals.

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