St. Jude settles fraud case for $3.7 million

Fri, 06/04/2010 - 1:10pm
The Associated Press

Medical device maker St. Jude Medical Inc. said Friday it will pay $3.7 million as part of a settlement with the Department of Justice over allegations the company paid illegal kickbacks to hospitals in Ohio.

The company admits no wrongdoing as part of the settlement.

St. Jude said the allegations centered "on small, isolated product rebates" that it paid more than five years ago.

In a separate statement, the Department of Justice said it alleged the company paid kickbacks to hospitals in an effort to secure heart-device business. That, in turn, caused false claims to be submitted to federal health care programs.

"Hospitals should base their purchasing decisions on what is in the best interests of their patients," Tony West, assistant attorney general for the Civil Division of the Department of Justice, said in a statement. "We will act aggressively to ensure that choices about health care are not tainted by illegal kickbacks."

Shares of St. Jude fell $1.45, or 3.8 percent, to $36.54 in late trading. The stock has traded between $31.66 and $42.87 over the last 52 weeks.


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