By Christopher A. Rothe
Medical device companies that enter into product development agreements with physicians and surgeons need to be aware of federal and state anti-kickback laws. The penalties for failure to comply with anti-kickback laws can be severe. In 2007, the U.S. Attorney’s Office completed a criminal investigation and found five medical device companies in violation of the Federal Anti-Kickback Statute. The companies were accused of paying kickbacks to orthopedic surgeons to induce the surgeons to use their products. All five companies avoided criminal prosecution by paying large financial settlements and signing agreements containing specific requirements for complying with the Federal Anti-Kickback statute.