Court Gives Device Whistleblower Another Chance
A Minnesota federal court has dismissed a whistleblower’s fraud on FDA claims against Boston Scientific Corp., but will allow him to re-file the allegations with greater particularity. Attorney Jennifer Thomas (Hyman, Phelps & McNamara) writes in her firm’s FDA Law Blog that the case involves two of the company’s defibrillators and allegations that it defrauded FDA by failing to inform the agency of alleged defects in the devices. The complaint also said the company failed to supplement its pending PMA application when doctors in Europe began to report problems with the devices, and worked to minimize the number of Medical Device Reports reaching the agency on issues with the devices.
Thomas says the court evaluated the claims in light of the Supreme Court’s 2016 Escobar decision that raised the issue of False Claims Act materiality. She says the high court paid particular attention in that case to government action as a test for materiality, reasoning that if the government paid claims knowing that some requirements were violated, that would be strong evidence that the requirements were not material.
The Minnesota court ultimately declined to determine whether the whistleblower’s claims were valid and material because they were not described with sufficient particularity, Thomas writes. While the whistleblower alleged particular claims that were submitted to the Centers for Medicare and Medicaid Services and received federal reimbursement, she says, he did not plead with particularity the acts or statements made to allegedly defraud FDA. She says the court held that the allegations of acts taken by Boston Scientific to mislead FDA failed to identify the time, place, and content of the alleged false representations or omissions. The court said it would expect to see identified portions of company submissions to FDA that constituted misrepresentations or omissions, and specific Medical Device Reports that should have been submitted but were not. It also said the whistleblower failed to plead whether any claims had been denied by the government after FDA recalled the defibrillator devices.
Thomas says the last issue could be the hardest for the whistleblower to address because given the way that hospital and outpatient services are reimbursed by federal programs, it is likely that the government continued to reimburse for procedures that were performed before the recall, even after the recall was issued.