Abiomed has agreed to pay $3.1 million to settle allegations it took physicians for expensive, boozy dinners to encourage them to use its heart pumps. Making the payment enables Abiomed to resolve the whistleblower-originated case without admitting liability.
In the government’s view, from 2012 to 2015 Abiomed arranged meals at high-end restaurants such as Eleven Madison Park in New York and Menton in Boston. At these events, “attendees ordered alcohol in an amount inconsistent with legitimate scientific discussion” and Abiomed footed the bill, the government said. The per-head cost of the meals allegedly topped $450, well above Abiomed’s $150 cap.
The government thinks Abiomed deflated its per-head figures by artificially increasing the number of people it claimed were at events. Abiomed is also said to have invited spouses with no professional interest in heart pumps to the meals.
Government officials making the case against Abiomed see these activities as evidence the company sought to induce physicians to use its $20,000 Impella heart pumps. Such inducements would violate the False Claims Act and amount to the defrauding of the federal government, which ultimately paid for some of the pumps through its healthcare programs. Abiomed has resolved the case without admitting liability to these charges.
The government thinks taking physicians for fancy meals focused more on entertainment than education can impair their medical judgment. And it hopes the Abiomed settlement will deter other device companies from paying for expensive meals.
“We expect today’s settlement with Abiomed to serve as a warning to medical device manufacturers who try to improperly influence the treatment decisions of physicians,” U.S. attorney Andrew Lelling said in a statement. “My office will continue to investigate sales practices that interfere with that independent medical judgment and that heighten the risk of improper use of limited federal healthcare dollars.”
Danvers, Mass.-based Abiomed downplayed the allegations in a SEC filing to disclose the settlement. Abiomed said the investigation found it complied with its internal price cap on meal prices 98% of the time.
The company also noted the case stemmed from the allegations of a former employee who lasted 29 days in the job. The employee claimed Abiomed fired him for complaining about the company’s meal practices. That allegation remains unresolved, but the employee, under whistleblower provisions of the False Claims Act, will receive more than $500,000 of the settlement.