SpineFrontier is a medical technology company that designs, develops and markets both implants and instruments for spine surgery based on the Less Exposure Surgery (LES®). Since its founding in 2006, the company says it has launched 35 new products.

The U.S. Attorney’s Office is suing SpineFrontier and an associated consulting firm, Impartial Medical Experts (IME), as well as executives of both companies alleging they paid $8 million in kickbacks to induce surgeons to use the device company’s products.

Prosecutors also announced they had settled civil health care fraud claims against five physicians, each of whom admitted to seeking and obtaining kickbacks from SpineFrontier, via IME, for consulting work They did not perform.

Each physician also admitted that SpineFrontier, CEO Kingsley Chin, or CFO Aditya Humad specifically instructed them to bill “consulting” hours to SpineFrontier for each surgery in which they used a SpineFrontier device, regardless of whether they spent any time actually consulting.

The government alleges that SpineFrontier and IME paid more than $8 million in kickbacks to surgeons, which generated more than $100 million in revenue, with the vast majority of SpineFrontier’s total domestic sales revenues coming from kickback-tainted surgeries.

Each of the five settling surgeons cooperated with the government’s investigation into the defendants, according to prosecutors, who said they took that cooperation into account in these settlements.

In connection with the filing of its complaint, the government intervened in two private whistleblower lawsuits that had been filed under seal pursuant to the False Claims Act. The cases are United States ex rel. Birchall v. SpineFrontier, Inc. et al., No. 15-cv-12877 and United States ex rel. Miller & Bennett v. SpineFrontier, Inc. et al., No. 15-cv-12908.

And SpineFrontier FDA compliance problems date back many years. One started when Patricia Katz, a new accountant with SpineFrontier, Inc., enrolled in two compliance classes. By the time this story ends, Katz is fired and suing her former employer under the whistleblower protection law.

Katz says she learned that the company’s lot tracking and tracing procedures violated federal safety regulations for medical devices. When reviewing usage forms, Katz said she immediately noticed that the lot numbers associated with SpineFrontier’s medical devices were rarely, if ever, recorded.

Katz sent an anonymous email to the FDA to determine whether or not SpineFrontier was in fact required to record lot numbers.

When she received confirmation from the FDA that what she had learned in compliance training was correct and that what she had been told by SpineFrontier officials was wrong, she forwarded her correspondence with an FDA agent to three company officials.

She alleges that the company, in spite of positive job performance reviews, fired her for that behavior.