Whistleblowers Say Doctors Took Kickbacks from Medtronic to Sell Products

A whistleblower lawsuit has been filed against nine Minnesota doctors alleging that they received kickbacks from Medtronic Inc.; the Minnesota based medical device company that has seen its share of scandals, recalls and lawsuits.

Over 100 doctors may have been involved

According to news reports, the lawsuit was filed by two former Medtronic employees and alleges that the company provided kickbacks to over 100 doctors and physician groups to buy and promote Medtronic’s Infusion Bone Graft – one of the company’s best selling spinal surgery products that was responsible for nearly 20% of the company’s $13.5 billion in revenue in 2007. In addition to allegations of kickbacks, the lawsuit also alleges that the product was market for unapproved uses.

Scandals, recalls and lawsuits

While Medtronic was not named in the lawsuit and denies the allegations, the company has seen its share of scandals, recalls and lawsuits over the past few years. In 2007, Medtronic was investigated for providing kickbacks to doctors in the form of “sham consulting agreements, sham royalty agreements and lavish trips to desirable locations.” However, those lawsuits were either dismissed or settled out of court for unknown amounts.

At around the same time, the company also found itself in hot water after it recalled its Sprint Fidelis defibrillator lead wire that has been linked to many injuries and deaths. As a result, the company faced hundreds of lawsuits.

The upward spiral of healthcare whistleblower lawsuits

There has been an upward spiral in the number of whistleblower, or Qui Tam, lawsuits filed in the healthcare industry over the past few years – and industry analysts predict that the trend will continue. The U.S. Food & Drug Administration has publicly admitted that it does not have the resources to police the food, drug and medical device industries and companies operating in these industries seem to be taking advantage of the situation. Unfortunately, it’s everyday consumers and taxpayers who end up paying the price.