This article is more than 5 years old. Information may no longer be current.
Olympus agrees to more than $600 million in settlements with US DOJ
Click Here to Manage Email Alerts
Olympus Corporation of the Americas has reached an agreement with the United States Department of Justice to pay more than $600 million in settlements to resolve two separate investigations concerning allegations that the company and a subsidiary respectively violated the U.S. Anti-Kickback Statute and the U.S. Foreign Corrupt Practices Act, according to a press release.
The company agreed to pay $623 million to resolve a civil whistleblower suit and criminal charges that it “gained market share dominance for its medical products through systemic violations of the U.S. Anti-Kickback Statute,” which prohibits direct bribes and in-kind rewards in exchange for recommendation, use or purchase of goods and services covered by government health programs. This is the largest settlement for violations of this statute in U.S. history, and the largest amount ever paid by a medical device company, according to a press release from the whistleblower’s attorneys.
The whistleblower was the company’s former corporate compliance officer, who filed a federal lawsuit under provisions of the False Claims Act to alert the government of Olympus’s non-compliance of the U.S. Anti-Kickback Statute. He was fired in 2010.
The subsequent federal investigation of the alleged kickback scheme activities that occurred between 2006 and 2011 was led by the New Jersey U.S. Attorney’s Office, according to an Olympus press release.
The allegations included that sales and marketing employees provided “permanent loans” of medical equipment to key accounts, provided cash rewards to physician consultants and educational and research programs based on sales potential, and provided vacations to physicians in exchange for purchases and promotion of products, according to the attorneys’ press release.
Olympus cooperated with the investigation, and settled on $612 million plus interest to resolve both the civil and criminal investigations, according to the company press release. The company is also entering into a Deferred Prosecution Agreement, a Civil Settlement Agreement, Medicaid State Settlement Agreements, and a Corporate Integrity Agreement requiring compliance measures and the appointment of a monitor.
The U.S. Department of Justice also began a separate investigation in October 2011 concerning allegations that Olympus Latin America, a subsidiary of Olympus Corporation of the Americas, violated the U.S. Foreign Corrupt Practices Act. The allegations concerned the company’s financial ties to government-employed health care providers who could influence purchase decisions. The company agreed on a $22.8 million settlement to resolve this investigation, and will enter a Deferred Prosecution Agreement with compliance measures, according to the company press release.
“Olympus leadership acknowledges the company’s responsibility for the past conduct, which does not represent the values of Olympus or its employees,” Olympus Corporation of the Americas’ President and CEO, Nacho Abia, said in the press release. “Olympus is committed to complying with all laws and regulations, and to adhering to our own rigorous code of conduct which guides our business processes, decisions and behavior. The Company has implemented and will continue to enhance its robust compliance program.”
Disclosure: Abia is an employee of Olympus Corporation of the Americas.