Tissue graft company to pay $6.5 million to settle defective pricing allegations

by Ben Vernia | April 10th, 2020

On April 6, the Department of Justice announced that Georgia-based MiMedx Group, Inc., will pay $6.5 million to settle civil allegations that the company submitted false pricing data (“defective pricing”) for its human tissue grafts. According to DOJ’s press release:

MiMedx Group Inc. (MiMedx), a biopharmaceutical company based in Marietta, Georgia that manufactures and sells human tissue grafts, will pay $6.5 million to resolve allegations that it violated the False Claims Act by knowingly submitting false commercial pricing disclosures to the United States Department of Veterans Affairs (VA), the Justice Department announced today.  

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This settlement resolves allegations that MiMedx knowingly submitted false statements and disclosures to the VA regarding MiMedx’s commercial pricing practices, enabling MiMedx to charge the VA inflated prices for its human tissue graft products.  Prior to the United States’ disclosure to MiMedx of its investigation, MiMedx made a disclosure to the VA Office of Inspector General regarding its commercial sales practices. In the settlement, the United States acknowledged MiMedx’s cooperation.

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The case was brought by two former MiMedx sales representative whistleblowers, who will receive $1.625 million from the settlement (a 25% relators’ share).

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