A genetic testing company has agreed to pay the federal government, several states, and the District of Columbia $4.1 million to settle a whistleblower‘s False Claims Act lawsuit alleging it coordinated an unlawful kickback scheme to boost sales of its medical testing services.
According to Law 360, the settlement resolves allegations in a False Claims Act lawsuit filed in April 2014 by Monique Gipson, a former sales representative for San Diego-based Pathway Genomics Corp. The U.S. government said on Dec. 24 that it would intervene in the case, meaning it would actively join in the litigation.
In her whistleblower complaint, Ms. Gipson, whose potential share of the settlement could top $1.2 million, accused Pathway Genomics of providing unlawful kickbacks to physicians and medical groups for their referrals of patients on Medicare, Medicaid, the Defense Department’s Tricare plan, and the Veterans Health Administration.
The alleged scheme violated the False Claims Act, the federal Anti-Kickback Statute, and other federal and state laws, the complaint asserted.
Pathway Genomics’ testing services cover a variety of conditions including cancer risk, cardiac health, inherited diseases, nutrition and exercise response, and drug response for specific medications including those used in pain management and mental health, the company’s website says.
A lawyer for the plaintiff told Law 360 that the illegal kickback scheme resulted in the federal government, 28 states, and D.C. having to pay Pathway Genomics for false claims that were not legally reimbursable.
The federal government will share the majority of the settlement. Smaller percentages will also be paid to California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Iowa, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Oklahoma, Rhode Island, Tennessee, Texas, Virginia, Washington, Washington, D.C., and Wisconsin.
Source: Law 360