Orthofix settles kickback allegations in whistleblower suit

by Ben Vernia | November 2nd, 2012

On November 2, the Department of Justice announced that Orthofix International, N.V., had agreed to pay $30 million and accept a Corporate Integrity Agreement to settle claims originally brought by a False Claims Act qui tam relator. According to DOJ’s press release:

Orthofix International NV, has agreed to pay the United States $30 million to settle allegations that an Orthofix subsidiary, Blackstone Medical Inc., paid illegal kickbacks to physicians in order to induce use of the company’s products, the Justice Department announced today. Orthofix, which manufactures spinal implants and other spinal surgery products, is a publicly traded company headquartered in Curacao.

The civil settlement resolves allegations that Blackstone paid kickbacks to spinal surgeons. These alleged kickbacks took a number of forms, including sham consulting agreements, sham royalty arrangements, sham research grants, travel and entertainment.

The government announced that the whistleblower will receive $8 million from the settlement (a 26.7% share).

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