Dive Brief:
- Aditya Humad, the CFO of spinal implant maker SpineFrontier, pled guilty to charges that he bribed surgeons in the form of sham consulting fees to use the company’s products in procedures billed to federal healthcare programs, the Justice Department said Tuesday.
- As part of the kickback scheme, Humad, 41, paid more than $540,000 in bribes, generating millions of dollars in revenue for his company from operations performed by the surgeons, prosecutors alleged.
- Humad pleaded guilty Monday in a federal district court in Massachusetts to one count of conspiracy to violate the Anti-Kickback Statute. Judge Indira Talwani has scheduled sentencing for Aug. 6.
Dive Insight:
The guilty plea stems from charges filed in September 2021 against Humad along with SpineFrontier, as well as Kingsley R. Chin, the company’s founder and CEO.
Chin pled guilty last year to making false statements to the Centers for Medicare and Medicaid Services and was later sentenced to one year of supervised release, including six months of home confinement.
Two other defendants connected to the case — surgeon Jason Montone and medical device distributor John Balzer — pled guilty in 2020 to related charges.
Prosecutors alleged Humad helped orchestrate an arrangement in which surgeons were paid between $250 and $1,000 per hour in consulting fees for work they either minimally performed or did not perform at all.
The consulting program was presented as a mechanism for obtaining technical product feedback. Instead, payments were used to induce surgeons to select SpineFrontier products in surgeries reimbursed by programs including Medicare, Medicaid and the Veterans Health Administration, prosecutors said.
Humad previously agreed to a civil settlement requiring him to pay more than $150,000, including interest. He also agreed to potential additional contingency payments based upon his annual income.
The charge of conspiring to violate the Anti-Kickback Statute provides for a sentence of up to five years in prison, three years of supervised release, a fine of $250,000 or twice the gross gain or gross loss resulting from the offense, whichever is greater, according to DOJ.
William Fick, a founding partner at law firm Fick & Marx, which represented Humad, declined to comment.
