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Healthcare Fraud: Johnson & Johnson Subsidiary Pays $18 Million in Settlement 

Diagnostics & Healthcare News August 9, 2016

BOSTON, MA–A Johnson & Johnson subsidiary was involved with skirting U.S. Food and Drug Administration (FDA) rules for its own gain, allegedly placing profit ahead of patient safety.

Johnson & Johnson

Acclarent Inc., J&J’s California-based manufacturer of medical devices, paid $18 million to resolve federal allegations that it caused health care providers to submit false claims to Medicare and other federal health care programs, the U.S. Department of Justice (DoJ) announced on July 22.

The company, which New Brunswick-based J&J acquired as a startup six years ago, illegally marketed and distributed its sinus spacer product for use as a drug delivery device without U.S. Food and Drug Administration (FDA) approval for that use, according to the announcement.

“The FDA approval process serves an important role in ensuring that federal health care participants receive devices that are safe, effective and medically appropriate,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the DoJ’s Civil Division.

“We will not permit companies to circumvent that process and put profits over patient safety.”

While selling medical devices for use during sinus surgeries, Acclarent received FDA clearance in 2006 to market its Relieva Stratus MicroFlow Spacer (Stratus) as a “spacer” to be used exclusively with saline.

The method insured that patients sinuses would remain open for two weeks following surgery. However, the DoJ said Acclarent intended for the Stratus to be used “instead as a drug-delivery device,” and noted it was designed only for that.

Moreover, after the FDA rejected the company’s 2007 request to expand approved uses for the Stratus, Acclarent continued to sell it as a tool for drug delivery.

The release cites an internal video used to prep sales staff on how-to train physicians. It demonstrates the Stratus being used with prescription corticosteroid Kenalog-40, and a white milky substance that resembled the corticosteroid, a method it wasn’t approved for.

“In 2010, Acclarent added a warning to its label regarding use of active drug substances in the Stratus; however, the government alleged that Acclarent nonetheless continued to market the Stratus for drug delivery,” stated the DoJ.

“By May 2013, Acclarent discontinued all sales of the Stratus and the company agreed to withdraw all FDA marketing clearances for the device, which is no longer commercially available in the United States.”

Read Full Article – Source: Healthcare Fraud: J&J Subsidiary Pays Feds $18 Million in Settlement | New Brunswick Today


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