Disposable products developer Merit Medical Systems has finalized an agreement with the U.S. Department of Justice (DOJ) to pay $18 million to settle charges that it engaged in improper marketing and promotional practices.
In a case that started with a whistleblower complaint, Merit was accused of paying physicians and hospitals to use its products for procedures performed on beneficiaries of federal healthcare programs like Medicare, Medicaid, and TriCare. The company was accused of setting up a program in which it paid healthcare providers in advertising and marketing support to induce sales of its products, a practice that the DOJ claimed amounted to illegal kickbacks to physicians.
The DOJ claimed that Merit provided advertising assistance, practice development, practice support, and what it called unrestricted "educational" grants to induce providers to buy its products, including EmboSphere devices for uterine fibroid embolization procedures and QuadraSphere devices for other types of embolization procedures.
The case was initiated by a whistleblower complaint filed by Dr. Charles Wolf, who was the company's chief compliance officer. Wolf will receive $2.65 million as part of the settlement. Merit also agreed to participate in a corporate integrity agreement with the U.S. Department of Health and Human Services.
