Justice Department announced Friday that Johnson & Johnson Inc subsidiary Acclarent Inc will pay $18 million to settle allegations levied on it that it has led healthcare providers to submit wrong claims to Medicare and other federal healthcare programs.

The California-based medical device manufacturer is facing the allegations that it has marketed its sinus spacer product for the use of a drug delivery device without taking the permission from the US Food and Drug Administration for the same purpose.

The government has also claimed that Acclarent continued to market the Stratus as a drug delivery device even after the FDA has rejected the company’s request to expand the already approved uses for the Stratus in 2007.

On July 20, Wednesday, the company’s former Chief Executive Officer, William Facteau and former Vice President of Sales, Patrick Fabian have been convicted following a six-week jury trial of 10 misdemeanor counts.

Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of Justice Departments’ Civil Division, said that the FDA approval procedure has been developed so as to make sure that people receives devices that are completely safe and effective. It is not at all allowed that companies avoid that procedure simply to give more value to profit over safety.

US Attorney Carmen M. Ortiz said that the FDA has an important role to pay when it comes to ensuring the safety and efficacy of a medical device and drugs in the United States. A person taking FDA-approved product should be satisfied that the aspects, safety and efficacy, have been met.

Ortiz said that they would continue to look for those who try to evade the patient protections. Phillip M. Coyne from the Department of Health and Human Services Office of Inspector General said, “Our investigators, working closely with our law enforcement partners, will continue to pursue allegations of such misconduct to hold fraudsters accountable and deter those tempted to launch such illegal scams”.

"California-based medical device manufacturer Acclarent Inc., a subsidiary of Johnson & Johnson, has agreed to pay $18 million to resolve allegations that the company caused health care providers to submit false claims to Medicare and other federal health care programs by marketing and distributing its sinus spacer product for use as a drug delivery device without U.S. Food and Drug Administration (FDA) approval of that use, the Justice Department announced today," according to a news report published by eNewsPF.

“The FDA approval process serves an important role in ensuring that federal health care participants receive devices that are safe, effective and medically appropriate,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division. “We will not permit companies to circumvent that process and put profits over patient safety.”

“The FDA plays a fundamental role in ensuring the safety and efficacy of medical devices and drugs in this country,” said U.S. Attorney Carmen M. Ortiz. “Every time that patients receive a medical device or fill a prescription they should be able to take for granted that the FDA’s requirements have been met. We will vigorously pursue those who ignore or seek to circumvent these important patient protections.”

“It is imperative that medical device companies adhere to FDA approval requirements so that patients are not subject to questionable medical treatments at taxpayer expense,” said Special Agent in Charge Phillip M. Coyne of the Department of Health and Human Services Office of Inspector General. “Our investigators, working closely with our law enforcement partners, will continue to pursue allegations of such misconduct to hold fraudsters accountable and deter those tempted to launch such illegal scams.”

According to a story published on the topic by Stat News, "The settlement with the US Department of Justice, which was disclosed on Friday, comes just two days after a pair of former executives at the J&J subsidiary, which is known as Acclarent, were found guilty of several misdemeanor charges of distributing a misbranded and adulterated device. A federal court jury in Boston found the executives marketed the Stratus device for a use that was not approved by the US Food and Drug Administration."

Here’s the back story: In 2006, Acclarent won FDA approval to market its Stratus device to be used only with saline to maintain sinus openings following surgery. But the feds alleged the company intended to market Stratus as a drug-delivery device for prescription corticosteroids and maintained the device was specifically designed and engineered for this use, according to court documents.