Exactech, a medical device company based in Gainesville, Florida, agreed to pay $8 million to resolve allegations that the company violated the federal False Claims Act.
This settlement relates to two separate components of Exactech’s total-knee replacement systems. First, the settlement resolves allegations that as early as January 2008, Exactech knew that its finned tibial tray — a metal component of its knee replacement system that fits into a patient’s tibia — failed prematurely at a higher than acceptable rate. But Exactech continued to market and sell the component for surgeries between January 1, 2008, and December 31, 2018.
Additionally, the settlement resolves allegations that as early as January 2019, Exactech knew that the polyethylene component in certain Logic and Truliant knee-replacement systems failed prematurely at a higher than acceptable rate. Therefore, it was not reasonable and necessary for use during total-knee replacement surgeries performed on government beneficiaries. But Exactech continued to market and sell the Logic and Truliant knee systems with defective polyethylene components for use during total-knee replacement surgeries between January 1, 2019, and February 7, 2022.
“Patients who need a medical device to enjoy their lives rely on device manufacturers to put patient safety first. When a manufacturer learns that its device is defective, it must promptly and transparently address the problem,” said Kelly O. Hayes, U.S. Attorney for the District of Maryland. “We will hold companies accountable who knowingly sell defective devices.”
Under the terms of the settlement, Exactech will pay a total of $8 million, $7,640,000 of which is the federal share. The states are entering into separate agreements with Exactech related to the $360,000 state share. The settlement is based on Exactech’s financial condition.
The U.S. Bankruptcy Court for the District of Delaware approved the settlement as part of the pending Chapter 11 bankruptcy proceedings involving Exactech.
