New Jersey-based Allergan Inc. has agreed to pay $500,000 to resolve allegations the company knowingly sold defective Lap-Bands to health care professionals for use in procedures to assist patients with weight loss, California Insurance Commissioner Dave Jones announced.
In a separate settlement agreement, Allergan agreed to pay $3.5 million to the federal government for similar allegations involving Medicare fraud. The company does not admit wrongdoing in either settlement.
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|Surgical deception
Allergan distributed, marketed, and sold the Lap-Band, an inflatable silicone band that is placed around a patient's stomach during a surgical procedure. The Lap-Bands Allergan sold allegedly had defective access ports used in the implantation process on the patient. The company then concealed the defects by misrepresenting the cause of leaky ports to the FDA, the public, and health care providers.
Additionally, Allergan allegedly provided kickbacks in the form of sham advisory boards, speaking fees, proctoring events, surgeon workshops, and travel-related expenses. The settlements resolve allegations that Allergan provided kickbacks to health care providers leading them to submit false statements for reimbursement.
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|Patient safety comes first
“Medical device distributors and health care providers have an obligation to place patient safety ahead of profits,” said Insurance Commissioner Dave Jones in a statement. “Concealing information about defective equipment and using misleading marketing practices puts patients' health at risk.”
The civil settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and obtain a portion of the government's recovery. The civil lawsuit was filed in the District of Maryland and is captioned United States ex rel. Schwartz and Tinsley v. Allergan, CCB-10-2796.
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Denny Jacob
Denny Jacob is an associate editor for NU PropertyCasualty360. Contact him at [email protected].
