A settlement has been reached to resolve False Claims Act allegations against AngioDynamics Inc.
The allegations arose from a lawsuit that claimed AngioDynamics Inc caused healthcare providers to submit false claims to federal healthcare programs over the use of two medical devices.
“The Justice Department is committed to holding medical device manufacturers accountable, which includes requiring that they follow all laws designed to ensure that medical devices are safe and effective,” said Acting Assistant Attorney General Chad A. Readler for the Justice Department’s Civil Division. “When manufacturers make misleading statements concerning the use of their products in ways that have not been cleared by the FDA, it undermines patient care. Taxpayers and patients deserve better.”
AngioDynamics will pay $11.5 million to resolve allegations that the company caused false claims to be submitted to government healthcare programs for procedures involving an unapproved drug-delivery device that was marketed with false and misleading promotional claims.
According to the government, allegedly, from May 2006 through December 2011, AngioDynamics served as the U.S. distributor for Biocompatibles plc, the manufacturer of LC Bead, and marketed LC Bead for use as a drug-delivery device in combination with chemotherapy drugs. Moreover, AngioDynamics personnel routinely claimed that this particular use of LC Bead, which FDA had twice declined to approve, was “better”, “superior”, “safer” and “less toxic” than alternative treatments, even though there was insufficient clinical evidence to support the truthfulness of these claims. Furhtermore, allegedly, AngioDynamics was aware that many insurers declined to provide coverage for certain LC Bead procedures and, as a result, instructed healthcare providers to use inaccurate billing codes when submitting claims for such uses.
Reportedly, the federal share of the civil settlement is approximately $10.9 million, and the state Medicaid share of the civil settlement is approximately $600,000.
The Whistleblower, a former AngioDynamics marketing employee, Ryan Bliss, will receive $2.3 million as part of the settlement.
