- A Maryland medical device manufacturer agreed to pay $15 million to resolve criminal charges that it failed to report a product recall to FDA and false claims allegations that it billed Medicare for indications that sales representatives knew were not backed by clinical data to receive inflated reimbursement, the Department of Justice announced Tuesday.
- The company, ACell, admitted it learned its topical wound care product, MicroMatrix, was contaminated with endotoxin levels that posed a threat to patients in January 2012. According to the plea deal, ACell pulled certain sizes of the device from the market, but did not notify FDA and hid the reason for the removal of the devices from its own sales force, doctors and hospitals.
- ACell also settled allegations by the Department of Justice it gave coding recommendations to doctors for MicroMatrix that it knew were incorrect and bribed prescribers to order devices with entertainment, speaker payments and free products.
Under the plea agreement, ACell will pay $3 million and abide by "extensive compliance reforms." Under the civil settlement, it will pay $12 million over five years to resolve civil liability for the alleged false claims submitted to Medicare.
According to now-unsealed court documents, ACell management conducted a clandestine removal of MicroMatrix devices between January 2012 and at least March 2012. Endotoxin exposure can cause fever, infection, septic shock and death, according to the DOJ.
"ACell's 'silent recall' placed patients at risk by preventing doctors from making informed medical care decisions concerning the use of ACell's devices, and preventing the FDA from fulfilling its responsibility of protecting public health and safety," the court document states.
Under ACell's 510(k) clearance for the MicroMatrix device, it only received an indication for "the management of topical wounds," after FDA raised concern that an internal use indication would require a premarket application.
"Despite the FDA's warning that ACell would need to submit an application for PMA if it intended to market its MicroMatrix for internal uses, ACell management directed and incentivized its sales force to sell MicroMatrix for a variety of internal uses that the FDA had not cleared," the court document states. The DOJ also alleged ACell senior management knew doctors were using MicroMatrix on patients internally despite FDA's warning such an indication would require a PMA.
Acting FDA Commissioner Ned Sharpless blasted ACell for its failure to report the product recall to the agency, saying ACell executives placed profit over patient safety "and violated the trust of patients and the medical community in their medical device."
We will not tolerate the actions of companies that put patients at risk. In this case, by failing to notify the FDA of a market withdrawal, the public was not properly notified of the risk and doctors may have used the device in procedures that jeopardized patient safety.— Dr. Ned Sharpless (@FDACommissioner) June 11, 2019
Under the Corporate Integrity Agreement with HHS' Office of Inspector General, ACell must implement a risk assessment and internal review process to identify compliance risks and have its board of directors and executives sign off on certifications. The CIA also requires "training, auditing and monitoring designed to address the range of activities (promotional and otherwise) at issue in the case."