August 18th, 2008 joshua
A Monroeville, Pa. medical devices supplier has filed a lawsuit against six major device manufacturers, alleging they have attempted to corner the market through kickbacks to physicians.
Richard and Holly McCullough, owners of Intermedics-McCullough, believe payments totaling more than $8 million were attempts to persuade physicians into buying directly from the manufacturer and not do business with its company, specifically.
The lawsuit alleges Zimmer Inc. and Zimmer Holdings Inc., DuPuy Orthopedics, Biomet Inc., Smith and Nephew Inc., Stryker Orthopedics and Stryker Inc. all made illegal payments to physicians.
The medical device industry, specifically manufacturers of joint replacement parts, has come under fire for paying physicians almost exclusively undisclosed amounts of money as “consultant fees” to endorse one company’s products over another.
The McCullough’s further allege their company is given more expensive and inferior products to distribute.
Specifically under fire are the following payments made to physicians:
> $8.07M from Zimmer to Dr. Harry Rubash, chief of orthopedic surgery at Mass. General Hospital.
> $825k in “royalty income” from Stryker to Dr. James D’Antonio.
> $408k from Zimmer to Dr. Anthony DiGoia.
> $300k from DuPuy to Dr. Lawrence Crossett.
Many of these medical device companies were under federal investigation earlier this year for these kickback payments. Stryker avoided prosecution by participating in the probe.
The Justice Department has since said many physicians accepting the payments were within their rights to accept the payments as they offered professional services in return.
