Paradigm Spine, a New York City-based medical device manufacturer, will pay the United States government $585,000 to resolve allegations contained in a whistleblower lawsuit filed by a former Paradigm sales representative under the False Claims Act.
The settlement brings to rest claims made by Chris Coyle, who sued his former employer on behalf of the federal government, accusing Paradigm of marketing a spinal implant called the coflex-F for unapproved surgical uses. Mr. Coyle’s complaint, which the U.S. government supported, alleged Paradigm unlawfully marketed the coflex-F device from 2012 to 2015.
The U.S. Food and Drug Administration (FDA) approves class II medical devices such as Paradigm’s coflex-F for specific uses. Devices that are used in ways that are not approved by the FDA are not eligible for reimbursements from Medicare, Medicaid, and other government health care programs.
Mr. Coyle’s FCA complaint also asserted that from 2012 to 2015, Paradigm provided health care professionals with “improper guidance” on how to submit claims for the coflex-F device to Medicare and other government health care programs.
According to the complaint, Paradigm’s actions led physicians and hospitals to submit false claims to federal health care programs for certain spinal surgeries that were not eligible for reimbursement.
“A medical device manufacturer has a duty to be truthful about the approved uses of medical devices and the appropriate billing codes to use when seeking payment from the government,” said U.S. Attorney Rod J. Rosenstein, who helped prosecute the case.
Whistleblowers whose FCA complaints result in a recovery for the U.S. receive an award of 15-30 percent of the total recovery. The U.S. Justice Department awarded Mr. Coyle $105,300, or 18 percent of the total recovery, for his role in calling out Paradigm’s alleged misconduct.