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False Claims Act Settlement Calls into Question Some Medical Product Rebate Practices

June 2010

Health Alert

On 4 June 2010, the Department of Justice (DOJ) announced that the United States had reached settlement of a qui tam action under the federal False Claims Act (FCA) with St. Jude Medical, a manufacturer of cardiac pacemaker and defibrillator devices. Under the terms of the settlement, which also may have relevance to pharmaceutical product rebates, St. Jude, headquartered in St. Paul, Minn., will pay USD$3,725,000. Parma Community General Hospital, located in Parma, Ohio, is paying USD$40,000, and Norton Healthcare in Louisville, Ky., is paying USD$133,300. The government asserted that Parma and Norton were recipients of improper payments from St. Jude.

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