Laser Catheter Company Pays $5 Million to Resolve Allegations


December 30, 2009

December 30, 3009 – The U.S. Justice Department said yesterday Spectranetics Corp. agreed to pay $4.9 million in civil damages, plus a $100,000 forfeiture, to resolve allegations it illegally imported unapproved medical devices and provided them to physicians for use in patients. The Justice Department also alleges the company conducted a clinical study that failed to comply with federal regulations and promoted the off-label used of its products.

Spectranetics manufactures, distributes and sells medical lasers for ablation, atherectomy and pacemaker/ICD lead removal. Some of these products include the CVX-300 Medical Laser and the CliRpath Turbo Laser Catheter, the TURBO Elite Laser Ablation Catheter, and the TURBO-Booster Laser Guide Catheter.

In resolving this matter, Spectranetics entered into a settlement agreement and a nonprosecution agreement with the United States. The company also entered into a corporate integrity agreement with the Office of Inspector General of the Department of Health and Human Services.

According to the nonprosecution agreement, officers and employees who acted on behalf of the company engaged in multiple areas of wrongdoing. Specifically, the Justice Department said Spectranetics illegally imported unapproved medical devices from overseas manufacturers and distributed the devices for use in human patients. The company failed to meet its reporting obligations to the FDA regarding a study named CORAL (COronary graft Results after Atherectomy with Lasers) and another associated study in connection with the devices listed above.

Under the terms of the nonprosecution agreement, Spectranetics has accepted responsibility for its conduct, has instituted remedial measures to prevent this conduct in the future, and will continue to cooperate in the ongoing criminal investigation. As a result, Spectranetics will not be criminally prosecuted for this conduct. Under the civil settlement agreement, the Justice Department asserted Spectranetics caused false claims to be submitted to the Medicare program during portions of the time period from 2003 to 2008.

"Our compliance agreement with Spectranetics holds the company and its executives accountable for violations of federal healthcare program and FDA requirements," said Daniel R. Levinson, inspector general of the Department of Health and Human Services. "Records from Spectranetics’ clinical investigations will be audited by an independent review organization to ensure compliance with FDA rules – including reporting of adverse events."

The case was handled by the U.S. Attorney's Office for the District of Colorado, the Office of Consumer Litigation and the Commercial Litigation Branch of the Justice Department's Civil Division and the Food and Drug Administration Office of Criminal Investigation. The corporate integrity agreement was handled by the Department of Health and Human Services Office of the Inspector General.

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