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Synthes-Norian Settlement Agreement

Synthes-Norian Settlement Agreement

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Published by roslyn rudolph

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Published by: roslyn rudolph on Jun 02, 2011
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04/30/2014

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SETTLEMENTAGREEMENTI.PARTIES
ThisSettlementAgreement("Agreement")isenteredinto,betweenandamongthefollowing,throughtheirauthorizedrepresentatives:
(l)
theUnitedStatesofAmerica,actingthroughtheUnitedStatesDepartmentofJusticeandtheUnitedStatesAttorney'sOfficefortheEasternDistrictofPennsylvania,andonbehalfof(a)theOfficeoftheInspectorGeneral("010-HHS")oftheUnitedStatesDepartmentofHealthandHumanServices("HHS"),(b)theUnitedStatesDepartmentofDefenseTRICAREManagementActivity("TMAn),and(c)theUnitedStatesDepartmentofVeteransAffairs("VA")(collectively"theUnitedStates");(2)Synthes,Inc.("Synthes");and(3)NorianCorporation("Norian").SynthesandNorianarehereinaftercollectivelyreferredtoas"theCompanies."TheUnitedStates,Synthes,andNorianarehereinaftercollectivelyreferredtoas"TheParties."
II.PREAMBLE
AsapreambletothisAgreement,thePartiesagreetothefollowing:A.SynthesisabusinesscorporationthatisorganizedunderthelawsoftheStateofDelaware,withitsprincipalplaceofbusinesslocatedatWestChester,Pennsylvania.Synthesisamulti-nationalmedicaldevicemanufacturingcorporation.Synthes'businessunitsincludeaSpineunit(alsoknownasSynthesSpineandfocusedondevicesforthespine)andaTraumaunit(alsoknownasSynthesU.S.A.andfocusedondevicesfornon-spine,non-headareasofthebody).
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B.NorianisawhollyownedsubsidiaryofSynthes,withitsprincipalplaceofbusinesslocatedatWestChester,Pennsylvania.C.AtallrelevanttimestheCompaniesdeveloped,manufactured,distributed,marketedandsoldmedicaldevicesintheUnitedStates.Suchdevicesincludedsignificantriskmedicaldevices(withinthemeaningof21U.S.C.§321(h)(I)and21C.F.R.§812(m)(J»thatweresoldunderthetradenamesofNorianXRandNorianSRS(togetherreferredtoasthe"CoveredDevices").D.OnsuchdateastheCourtmaydetermine,SyntheswillenterapleaofguiltypursuanttoFed.R.Crim.P.II(c)(I)(C)("theSynthesPleaAgreement")toaSupersedingInformation(waivingprosecutionbyindictment)tobefiledinUnitedStatesofAmericav.Synthes,Inc.,CriminalActionNo.09-403-02(EasternDistrictofPennsylvania)(the"SynthesCriminalAction")thatwillchargeSyntheswithonecountofmisdemeanorviolationsofTitle21,UnitedStatesCode,Sections331(a)and333(a)(I),namely,theintroductionintointerstatecommerceofmedicaldevices,NorianXRandNorianSRS,thatwereadulteratedunder21U.S.C.§351(0(1)(8)andthatweremisbrandedunder21U.S.C.§352(t),(0).E.OnsuchdateastheCourtmaydetermine,NorianwillenterapleaofguiltypursuanttoFed.R.Crim.P.11(c)(1)(C)("theNorianPleaAgreement")toaSupersedingInformation(waivingprosecutionbyindictment)tobefiledinUnitedStatesofAmericav.NorianCorporation,CriminalActionNo.09-403-01(EasternDistrictofPennsylvania)(the"NorianCriminalAction")thatwillchargeNorianwith:(a)onecountoffelonyviolationofTitle18,UnitedStatesCode,Section371;and(b)110misdemeanorcountsofviolating21U.S.C.§§331(a)and333(a)(1)--namely,introducingintointerstatecommercemedicaldevices,NorianXRandNorianSRS,thatwereadulteratedunder21U.S.C.§351(f)(1)(B)andmisbrandedunder21U.S.C.§352(f),
(0).
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F.TheUnitedStatesallegesthattheCompaniesengagedinthefollowingconduct("theCoveredConduct")duringtheperiodNovember1,2002throughJanuary1,2004:TheCompaniesmadeand/ordisseminatedunsubstantiatedand/orfalserepresentations,directlyorbyimplication,aboutthesafetyandefficacyoftheCoveredDevices,assetforthintheSupersedingInformationstobefliedinCriminalActionNos.09-403-0Iand02,inconnectionwiththeuseofthosedevicesinvertebralcompressionfracturesurgeriesinvolvingthirty-one(31)beneficiariescoveredbyMedicare,TRICARE,and/ortheVAwhentheuseofthosedeviceswasnotreasonableandnecessary,andwhensuchnon-indicatedusewas,ontheNorianXRproductandlorpackagelabeling,explicitlywarnedagainst.Asaresultoftheforegoingconduct,theCompaniesknowinglycausedfalseorfraudulentclaimsfortheCoveredDevicestobesubmittedto,orpurchasestobemadeby,Medicare,TMA,andtheVAinconnectionwiththosethirty-one(31)beneficiaries.G.TheUnitedStatescontendsthatithascertaincivilandadministrativeclaims,asspecifiedinParagraphs2,3,and4below,againsttheCompaniesforengagingintheCoveredConduct.
H.
ThisAgreementismadeincompromiseofdisputedclaims.ThisAgreementisnotanadmissionoffactsorliabilitybytheCompanies.WiththeexceptionofsuchadmissionsthataremadeinconnectionwithanyguiltypleabytheCompaniesinconnectionwiththeSynthesCriminalActionandtheNorianCriminalAction,theCompaniesexpresslydenytheallegationsoftheUnitedStatesassetforthhereinanddenythattheCompaniesengagedinanywrongfulconductinconnectionwiththeCoveredConduct.ThisAgreementisnotaconcessionbytheUnitedStatesthatitsclaimsarenotwellfounded.Neither
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