St. Jude settles with DoJ
This article was originally published in The Gray Sheet
Executive Summary
St. Jude Medical will pay $3.7 million to settle allegations by the Department of Justice that it provided illegal kickbacks to two hospitals to secure mechanical heart valve and cardiac rhythm management device sales, DoJ announced June 4. Federal investigators allege that St. Jude offered the kickbacks in the form of two types of rebates: "retroactive" rebates based on a hospital's previous purchases of St. Jude heart devices and rebates for purchases of competing products "to induce purchases of similar equipment from St. Jude in the future," according to the DoJ statement. Parma Community General Hospital, Parma, Ohio, will pay $40,000 and Norton Healthcare, Louisville, will pay $133,000 under the settlement. St. Jude also received a DoJ subpoena in March seeking documents addressing implantable defibrillator indications and reimbursement (1"The Gray Sheet" May 10, 2010) and the firm is under federal investigation for alleged off-label promotion of a cardiac surgical ablation device for atrial fibrillation (2"The Gray Sheet" July 20, 2009)