MEDTRONIC ENTERS INTO $40 MILLION SETTLEMENT WITH DOJ OVER WHISTLEBLOWER ALLEGATIONS

The Department of Justice (DOJ) and Medtronic announced July 18 the firm will pay the government $40 million to settle civil allegations the firm's Sofamor Danek division paid kickbacks to healthcare professionals (HCPs) inducing them to use Medtronic's spinal products.

The case resulted from a whistleblower suit filed in 2003 with the U.S. District Court for the Western District of Tenessee by former Medtronic senior travel manager Jacqueline Kay Poteet, who arranged HCP trips to conferences.

Under the settlement with the DOJ, Medtronic has entered into a five-year agreement to strengthen its employee training and compliance systems regarding its sales and marketing practices, the firm said. Medtronic's spinal business unit must also "establish an electronic database to capture and manage all non-sales-related transactions between the business unit and its customers."

The DOJ will seek final dismissal of a second suit filed in 2004, the firm noted. (See the full story in the upcoming July 24 issue of Devices & Diagnostics Letter.)