The federal government has accused Life Spine of paying millions of dollars in kickbacks to surgeons — enough to account for half of the company’s total domestic sales from 2012 through 2018.
The civil suit against the Huntley, Ill.-based company claims that Life Spine violated the False Claims Act by allegedly paying surgeons consulting fees, royalties, and intellectual property acquisition fees to induce them to use the company’s spinal implants, devices, and equipment. The suit also claims that company president & CEO Michael Butler, and VP of business development Richard Greiber caused hospitals and surgeons to submit false claims for payment to Medicare and Medicaid.
“As alleged, Life Spine and its senior management flagrantly ignored the law by paying surgeons millions of dollars in fees and royalties to get them to use Life Spine products during spinal surgeries,” Manhattan U.S. Attorney Geoffrey S. Berman said in a news release. “Kickbacks to doctors can alter or compromise their judgment about the medical care and services to provide to patients, and can increase healthcare costs. This office will continue to hold companies and the people who run them accountable when they make improper payments to doctors.”
“Cases like this are why patients sometimes distrust the care they receive because they don’t know if it’s what the doctor actually thinks, or if there is a company pushing a new drug or new device,” added FBI assistant director William F. Sweeney Jr. “People seeking medical treatment are dependent on the advice they get, they don’t have the expertise to question the doctors. The FBI does all it can to stop those companies who overlook the patient who is just hoping to get better, and only sees the dollar signs.”
The government claims that Life Spine “aggressively recruited surgeons who had the potential to use a high volume of Life Spine Products to enter into agreements to serve as paid consultants and/or to transfer their patents/patent applications to Life Spine in exchange for payments and promised support to bring the surgeons’ new products to market… Life Spine and Butler expected surgeons to commit to using Life Spine Products at a certain level in exchange for the consulting fees, royalties, and intellectual property acquisition fees paid to them.”
The federal government said it intervened in the private whistleblower suit that had previously been filed under seal pursuant to the False Claims Act.
Life Spine said in a separate news release that it had recently become aware of the lawsuit, that it is in discussions with the federal government and “look(s) forward to resolving the matter.”
Separately, the company said it has won FDA clearance of its Prolift expandable spacer system in widths of 8mm to 10mm.
“The new 8mm-10mm widths of the Prolift expandable spacer system are essential additions to our innovative Micro Invasive portfolio,” said company marketing VP Mariusz Knap. “The new sizes will more than double our current footprint options for Prolift, which will allow us to accommodate a wider range of patients and their unique pathologies.”