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DOJ Files Suit Against Life Spine

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The U.S. Department of Justice filed a civil healthcare fraud lawsuit against Life Spine and certain of its executives for alleged surgeon kickback payments.

The complaint seeks damages and civil penalties under the False Claims Act for allegedly paying surgeons kickbacks of consulting fees, royalties and intellectual property acquisition fees to induce them to use Life Spine's products. The suit alleges that surgeons who received these payments accounted for approximately half of the company's U.S. spine product sales from 2012 through 2018.

The complaint indicates that such payments violate the Anti-Kickback Statute and caused hospitals and surgeons to submit false claims for payment to Medicare and Medicaid. 

The complaint suggests that the company aggressively recruited potential high-volume surgeons to enter into agreements as paid consultants and/or to transfer their patents/patent applications to Life Spine in exchange for payments and support to bring the surgeons’ new products to market.  Life Spine reportedly tied these agreements, associated payments and resources to the product development projects to the surgeons’ use of Life Spine products.

In a published statement, Life Spine responded that the parties are engaged in discussions and noted that the company has developed and been awarded over 200 patent positions for its product portfolio and surgical techniques. The company has experienced a 39% compounded annual growth rate in recent years by developing and patenting numerous Micro Invasive Surgical procedures that employ expandable implant technology. Ongoing clinical studies intend to show that this surgical technique can reduce procedure time by up to 60% vs. a transforaminal lumbar interbody fusion.

Sources: Life SpineU.S. Department of Justice