Spectranetics to Pay Feds $5M

Excimer laser maker Spectranetics Corp. has agreed to pay the US $4.9 million in civil damages plus $100,000 in cash or property to resolve claims against the company, the Justice Department announced Tuesday.

“I believe that our level of cooperation and responsiveness and our demonstrable efforts at compliance, much of which preceded the onset of the federal investigation, were critical components that led to the resolution of this matter with no charges filed against Spectranetics,” said Emile J. Geisenheimer, Spectranetics chairman, president and CEO.

The federal claims arose from allegations that the company illegally imported unapproved medical devices and provided them to physicians for use in patients, conducted a clinical study in a manner that failed to comply with federal regulations and promoted certain products for procedures for which the company had not received Food and Drug Administration (FDA) approval or clearance.

The company makes excimer lasers and peripheral devices for those lasers, such as lead wires that guide the lasers through vascular tissue and catheters that carry and contain the lasers inside the veins, including the CVX-300 medical laser and the CliRpath Turbo laser catheter, the Turbo Elite laser ablation catheter and the Turbo-Booster laser guide catheter.

Spectranetics entered into a civil settlement agreement and a nonprosecution agreement with the US to resolve the matter. The company also entered into a corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services.

According to the nonprosecution agreement, officers and employees who acted on behalf of the company engaged in multiple areas of wrongdoing. Specifically, Spectranetics illegally imported unapproved medical devices from overseas manufacturers and distributed those devices for use in human patients, and failed to meet its reporting obligations to FDA regarding a study named “Coral” (COronary graft Results after Atherectomy with Lasers) and another associated study in connection with the devices listed above.

Under the terms of the nonprosecution agreement, Spectranetics accepted responsibility for its conduct, instituted remedial measures to prevent such actions in the future and will continue to cooperate in the ongoing criminal investigation in exchange for not being criminally prosecuted.

Under the civil settlement agreement, the US asserted that, as a result of the conduct, Spectranetics caused false claims to be submitted to the Medicare Program between 2003 and 2008.

“It is important to hold those who submit false claims to Medicare responsible for their actions,” said US Attorney David Gaouette. “Settlements such as this help to protect the integrity of the Medicare system.”

“Our compliance agreement with Spectranetics holds the company and its executives accountable for violations of federal health care program and FDA requirements,” said Daniel R. Levinson, inspector general of the Department of Health and Human Services. “Records from Spectranetics’ clinical investigations will be audited by an Independent Review Organization to ensure compliance with FDA rules – including reporting of adverse events.”

The matter was handled by the US Attorney’s Office for the District of Colorado, the Office of Consumer Litigation and the Commercial Litigation Branch of the Justice Department’s Civil Division, and the FDA Office of Criminal Investigation. The corporate integrity agreement was handled by the Department of Health and Human Services Office of the Inspector General.

For more information, visit: www.fda.gov