Last week, the Department of Justice (DOJ) announced that pacemaker manufacturer Biotronik Inc. (Biotronik) had agreed to pay $12.95 million to resolve allegations that, from 2013 to 2021, it had illegally induced physicians to implant its devices using kickbacks such as payments for participation in trainings that were unnecessary or did not occur, and payments for physicians’ holiday parties, winery tours, lavish meals, and “international business class airfare and honoraria in exchange for making brief appearances at international conferences.” The accompanying settlement agreement does not reference a Department of Health and Human Services Office of Inspector General (HHS-OIG) corporate integrity agreement (CIA), and instead indicates that HHS-OIG merely reserved its exclusion authority. Moreover, neither DOJ’s press release nor the settlement agreement mentioned that DOJ had settled very similar allegations against Biotronik just eight years earlier.
In 2014, DOJ announced that Biotronik had agreed to pay $4.9 million to resolve allegations that it had induced physicians to implant its devices using kickbacks “in the form of repeated meals at expensive restaurants and inflated payments for membership on a physician advisory board.” The 2014 press release omitted any mention of a CIA, presumably because there was none.
Why didn’t DOJ’s latest press release mention that Biotronik was a repeat offender, or that Biotronik was continuing to pay illegal kickbacks even as it was settling with the government in 2014? Those seem like facts the public should know. Was DOJ hoping that nobody would notice?
Perhaps more importantly, why didn’t DOJ and HHS-OIG demand that Biotronik enter into a CIA as a condition of the latest settlement, given that the prior settlement apparently did not deter Biotronik from paying kickbacks to physicians who implant its devices? Is HHS-OIG planning to bring an exclusion action against Biotronik, given its repeated offenses? That seems highly unlikely, since HHS-OIG rarely, if ever, brings such actions against large corporations.
Demanding a CIA, or demanding a more onerous settlement agreement (DOJ allowed Biotronik to deny the government’s allegations) likely would have prolonged the work of the government attorneys involved in the case. But, when a company flouts the law by paying kickbacks even after it has been caught previously doing almost exactly the same thing, it sure seems like the government should take a harder line that might deter or prevent the company from violating the law again.
