Christopher Christie, U.S. Attorney for the District of New Jersey, yesterday announced a settlement with four major hip and knee replacement manufacturers that allows the companies to avoid criminal prosecution and civil suits arising from alleged kickback relationships with orthopedic surgeons. Under the settlement, Zimmer, Inc., Depuy Othopaedics, Inc., Biomet, Inc., and Smith & Nephew, Inc. entered deferred prosecution agreements under which they agreed to pay a total of $310 million, submit to 18 months of federal monitoring and implement additional reforms over the next five years. A fifth company, Stryker Orthopedics, Inc., agreed to submit to monitoring, but refused to enter into any monetary settlement, leaving it open to potential civil claims by the government.
Together, the five companies represent nearly 95 percent of the hip and knee replacement market. Each company was accused of “using consulting agreements with orthopedic surgeons as inducements to use a particular company’s artificial hip and knee reconstruction and replacement products” between at least 2002 and 2006. In addition to such agreements, which allegedly paid surgeons tens to hundreds of thousands of dollars per year, the companies are also alleged to have provided doctors with trips and other perks.
A complete copy of the U.S. Attorney’s press release can be found here.
