Philips subsidiary to pay over $24 million for alleged false claims

(Reuters) — A subsidiary of Dutch medical device maker Philips has agreed to pay over $24 million to resolve alleged false claims over respiratory-related medical equipment, the U.S. Justice Department said Thursday.

The subsidiary, Philips RS North America LLC, formerly known as Respironics Inc., resolved allegations that it misled federal health care programs by paying kickbacks to durable medical equipment suppliers, the Justice Department said in a statement.

Respironics allegedly gave the suppliers physician prescribing data free of charge that could assist their marketing efforts to physicians, the Justice Department said.

"Paying illegal remuneration to induce patient referrals undermines the integrity of our nation’s healthcare system," said Principal Deputy Assistant Attorney General Brian Boynton, head of the Justice Department's civil division.

Respironics also entered into a five-year agreement with the U.S. Department of Health and Human Services, Office of the Inspector General, to implement a compliance program that includes review of arrangements with referral sources and monitoring of Respironics' sales force, the Justice Department said.

The company did not immediately respond to a request for comment on Thursday.