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Corporate Integrity Agreement

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Exhibit 10.24

CORPORATE INTEGRITY AGREEMENT

BETWEEN THE OFFICE OF INSPECTOR GENERAL

OF THE

DEPARTMENT OF HEALTH AND HUMAN SERVICES

AND

BIOMET, INC.

I. PREAMBLE Contemporaneously with this CIA Biomet, Inc. (" Biomet" ) and Biomet Orthopedics, Inc. (" Biomet Orthopedics" ) entered into a Settlement Agreement with the United States and a Deferred Prosecution Agreement (DPA) with the United States Attorney' s Office for the District of New Jersey. Biomet Orthopedics is a wholly owned subsidiary of Biomet engaged in the business of designing, manufacturing, marketing and selling joint reconstruction and replacement products. Biomet and Biomet Orthopedics hereby enter into this CIA with the Office of Inspector General (OIG) of the United States Department of Health and Human Services (HHS) to promote compliance by their officers, directors, employees, contractors, and agents with the statutes, regulations, and written directives of Medicare, Medicaid, and all other Federal health care programs (as defined in 42 U.S.C. a7 1320a-7b(f)) (Federal health care program requirements). This CIA shall apply only to U.S. operations of Biomet that are subject to U.S. Federal health care program requirements. 1

Biomet represented to the OIG that, prior to the effective date of this CIA, Biomet established a voluntary compliance program, which applies to Biomet Orthopedics and includes a corporate compliance officer, a corporate compliance committee, a Code of Business Conduct and Ethics for all employees, written policies and procedures, educational and training initiatives, review and disciplinary procedures, a confidential disclosure program, an ineligible persons screening program, and internal audit and review procedures. Biomet agrees to continue the operation of its compliance program in accordance with the terms set forth below for the term of this CIA.

1 The CIA shall not apply to the following Biomet affiliated entities: Biomet Microfixation, Inc.; Biomet Biologics, Inc.; Biomet Sports Medicine, Inc.; EBI, L.P.; Biomet Manufacturing Corp.; and Biomet 3i, Inc. II. TERM AND SCOPE OF THE CIA A. The period of the compliance obligations assumed by Biomet and Biomet Orthopedics under this CIA shall be 5 years from the effective date of this CIA, unless otherwise specified. The effective date shall be the date on which the final signatory of this CIA executes this CIA (Effective Date). Each one-year period, beginning with the one-year period following the Effective Date, shall be referred to as a " Reporting Period."

B. Sections VII, VIII, IX, X, and XI shall expire no later than 120 days after OIG' s receipt of: (1) Biomet' s final annual report; or (2) any additional materials submitted by Biomet pursuant to OIG' s request, whichever is later.

C. The scope of this CIA shall be governed by the following definitions:

1." Arrangements" shall mean every arrangement or transaction entered into by Biomet Orthopedics that (a) involves, directly or indirectly, the offer, payment, solicitation, or receipt of anything of value; and (b) is between Biomet or Biomet Orthopedics and any actual or potential source of health care business or referrals of health care business to Biomet Orthopedics or any actual or potential recipient of health care business or referrals from Biomet Orthopedics. The term " source" shall include any physician, contractor, vendor, or agent; and the term " health care business or referrals" shall be read to include referring, recommending, or arranging for, ordering, leasing or purchasing of any good, facility, item, or service for which payment may be made in whole or in part by a Federal health care program. a. " Contractual Arrangements" shall mean every Arrangement that is contractual in nature related to the provision of services to or for the benefit of Biomet Orthopedics, including but not limited to, training, education, consulting, research, clinical studies, focus groups, physician advisory boards, and product design agreements involving the development and/or transfer of intellectual property.

b. " Non-Contractual Arrangements" shall mean all Arrangements that are not Contractual Arrangements, such as grants and charitable contributions.


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2. " Covered Persons" includes: a. all officers, directors and employees of Biomet and Biomet Orthopedics, including but not limited to, Biomet' s CEO and President and all members of Biomet' s management, inclusive of senior vice presidents, vice presidents, directors, and managers;

b. all contractors, subcontractors, agents, and other persons who, on behalf of Biomet and Biomet Orthopedics, perform functions related to the sale or marketing of items or services reimbursable by Federal health care programs; and c. all individuals that sell or market on behalf of Biomet and Biomet Orthopedics items or services for which reimbursement may be made by the Federal health care programs.

Notwithstanding the above, this term does not include part-time or per diem employees, contractors, subcontractors, agents, and other persons who are not reasonably expected to work more than 160 hours per year, except that any such individuals shall become " Covered Persons" at the point when they work more than 160 hours during the calendar year.

3. " Arrangements Covered Persons" includes Covered Persons involved in the development, approval, management, implementation, use, or review of any of Biomet Orthopedics' Arrangements.

III. CORPORATE INTEGRITY OBLIGATIONS Biomet shall maintain a compliance program that includes the following elements during the term of the CIA: A. Compliance Officer and Committee .

1. Compliance Officer . Biomet represented to the OIG that, prior to the Effective Date of this CIA, Biomet appointed a Compliance Officer who is responsible for developing and implementing policies, procedures, and practices designed to ensure compliance with Federal health care program requirements by


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Biomet and Biomet Orthopedics. Biomet shall maintain a Compliance Officer for the term of the CIA and the Compliance Officer shall be responsible for developing and implementing policies, procedures, and practices designed to ensure compliance with the requirements set forth in this CIA. The Biomet Compliance Officer shall be a member of senior management, shall make periodic (at least quarterly) reports regarding compliance matters directly to Biomet' s Board of Directors and shall be authorized to report on compliance matters to Biomet' s Board of Directors at any time. The Compliance Officer shall not be or be subordinate to Biomet' s General Counsel or Chief Financial Officer. The Compliance Officer shall be responsible for monitoring the day-to-day compliance activities engaged in by Biomet and Biomet Orthopedics, as well as for any reporting obligations imposed upon Biomet and Biomet Orthopedics under this CIA.

Biomet shall report to OIG, in writing, any changes in the identity or position description of the Compliance Officer, or any actions or changes that would affect the Compliance Officer' s ability to perform the duties necessary to meet the obligations in this CIA, within 15 days after such a change. 2. Compliance Committee . Within 90 days after the Effective Date, Biomet shall appoint a Compliance Committee for Biomet and Biomet Orthopedics. The Compliance Committee shall, at a minimum, include the Compliance Officer and other members of senior management of Biomet and Biomet Orthopedics necessary to meet the requirements of this CIA (e.g., senior executives of relevant departments, such as finance, human resources, legal, sales, and operations). The Compliance Officer shall chair the Compliance Committee and the Compliance Committee shall support the Compliance Officer in fulfilling his or her responsibilities (e.g., assist in the analysis of Biomet' s risk areas and oversee monitoring of internal and external audits and investigations).

Biomet shall report to OIG, in writing, any changes in the composition of the Compliance Committee, or any actions or changes that would affect the Compliance Committee' s ability to perform the duties necessary to meet the obligations in this CIA, within 15 days after such a change.


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B. Written Standards . 1. Code of Conduct . Biomet represented to the OIG that, prior to the Effective Date of this CIA, Biomet developed a Code of Business Conduct (" the Code of Conduct" ), which is applicable to Biomet Orthopedics. Biomet and Biomet Orthopedics shall make the promotion of, and adherence to, the Code of Conduct an element in evaluating the performance of all employees. To the extent not already addressed in the Code of Conduct, within 90 days of the Effective Date, the Code of Conduct shall be revised to include, at a minimum, the following elements:

a. Biomet' s and Biomet Orthopedics' commitment to full compliance with all federal, state and local laws and regulations (which includes Federal health care program requirements); b. Biomet' s and Biomet Orthopedics' requirement that all Covered Persons shall be expected to comply with all Federal health care program requirements and with Biomet' s own Policies and Procedures as implemented pursuant to this Section III.B (including the requirements of this CIA);

c. the requirement that all Covered Persons shall be expected to report to their Compliance Officer, or other appropriate individuals designated by Biomet or Biomet Orthopedics, suspected violations of any Federal health care program requirements or of Biomet' s or Biomet Orthopedics' own Policies and Procedures;

d. the possible consequences to Biomet, Biomet Orthopedics and Covered Persons of failure to comply with all Federal health care program requirements and with Biomet' s Policies and Procedures and the failure to report such non-compliance; and e. the right of all individuals to use the Disclosure Program described in Section III.F, and Biomet' s commitment to nonretaliation and to maintain, as appropriate, confidentiality and anonymity with respect to such disclosures.

To the extent not already accomplished, within 90 days after the Effective


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Date, Biomet shall distribute the Code of Conduct (revised as necessary to include the elements set forth above) to each Covered Person and each Covered Person will certify, in writing or electronically, that he or she has received, read, understood and shall abide by Biomet' s Code of Conduct. Biomet may distribute the Code of Conduct and the required certification to each Covered Person either electronically or in hard-copy form. New Covered Persons shall receive the Code of Conduct and shall complete the required certification within 30 days after becoming a Covered Person or within 90 days after the Effective Date, whichever is later.

Biomet shall periodically review the Code of Conduct to determine if revisions are appropriate and shall make any necessary revisions based on such review. Any revised Code of Conduct shall be distributed within 30 days after any revisions are finalized. Each Covered Person shall certify, in writing or electronically, that he or she has received, read, understood, and shall abide by the revised Code of Conduct within 30 days after the distribution of the revised Code of Conduct.

2. Policies and Procedures . Within 120 days after the Effective Date, Biomet and Biomet Orthopedics shall implement written Policies and Procedures regarding the operation of Biomet' s compliance program and Biomet' s and Biomet Orthopedics' compliance with Federal health care program requirements. At a minimum, the Policies and Procedures shall address:

a. the subjects relating to the Code of Conduct identified in Section III.B.1;

b. the expectation that all Covered Persons shall comply with the Code of Conduct, the Policies and Procedures required under this Section, and this CIA;

c. 42 U.S.C. a7 1320a-7b(b) (Anti-Kickback Statute) and the regulations and other guidance documents related to this statute, and business or financial arrangements or contracts that may violate the Anti-Kickback Statute, and the applicability of the Anti-Kickback Statute to Arrangements as that term is defined in Section II.C.1; and

d. the requirements set forth in Section III.D (Compliance with the Anti-Kickback Statute), including but not limited to the Arrangements Database, the internal review and approval process, and the tracking of remuneration to and from sources of health care business or referrals.


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Within 120 days after the Effective Date, the relevant portions of the Policies and Procedures shall be distributed to all individuals whose job functions relate to those Policies and Procedures. Distribution may include publishing such Policies and Procedures on Biomet' s intranet or other internal web sites available to all employees. If Biomet uses such an electronic method of distribution, it must notify the individuals receiving the Policies and Procedures that the Policies and Procedures will be distributed in such a manner, and it must adopt tracking procedures designed to track the distribution and reasonably ensure that all appropriate individuals received the Policies and Procedures. Appropriate and knowledgeable staff shall be available to explain the Policies and Procedures. At least annually (and more frequently, if appropriate), Biomet shall assess and update, as necessary, the Policies and Procedures. Within 30 days after the effective date of any revisions, the relevant portions of any such revised Policies and Procedures shall be distributed to all Covered Persons whose job functions relate to those Policies and Procedures. C. Training and Education .

1. General Training . Within 120 days after the Effective Date, Biomet shall provide at least two hours of General Training to each Covered Person. This training, at a minimum, shall explain Biomet' s: a. CIA requirements; and

b. Compliance Program (including the Code of Conduct and the Policies and Procedures as they pertain to general compliance issues).

New Covered Persons shall receive the General Training described above within 30 days after becoming a Covered Person or within 120 days after the Effective Date, whichever is later. After receiving the initial General Training described above, each Covered Person shall receive at least one hour of General Training in each subsequent Reporting Period.


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2. Arrangements Training . Within 120 days after the Effective Date, each Arrangements Covered Person shall receive at least three hours of Arrangements Training, in addition to the General Training required above. The Arrangements Training shall include a discussion of: a. Arrangements that potentially implicate the Anti-Kickback Statute, as well as the regulations and other guidance documents related to this statute;

b. Biomet' s and Biomet Orthopedics' policies, procedures, and other requirements relating to Arrangements, including but not limited to the Arrangements Database, the internal review and approval process, and the tracking of remuneration to and from sources of health care business or referrals required by Section III.D of the CIA; c. the personal obligation of each individual involved in the development, approval, management, implementation, use, or review of Biomet Orthopedics' Arrangements to know the applicable legal requirements and Biomet' s and Biomet Orthopedics' policies and procedures;

d. the legal sanctions under the Anti-Kickback Statute; and

e. examples of violations of the Anti-Kickback Statute.

New Arrangements Covered Persons shall receive this training within 30 days after the beginning of their employment or becoming Arrangements Covered Persons, or within 120 days after the Effective Date, whichever is later. A Biomet Orthopedics employee who has completed the Arrangements Training shall review a new Arrangements Covered Person' s work until such time as the new Arrangements Covered Person completes his or her Arrangements Training.

After receiving the initial Arrangements Training described in this Section, each Arrangements Covered Person shall receive at least two hours of Arrangements Training in each subsequent Reporting Period.


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3. Certification. Each individual who is required to attend training pursuant to this Section III.C shall, upon completion of the training, certify, in writing or in electronic form, that he or she has received the required training. The certification shall specify the type of training received and the date received. The Compliance Officer (or designee) shall retain the certifications, along with all course materials. These shall be made available to OIG, upon request.

4. Qualifications of Trainer. Persons providing the training required by this Section III.C shall be knowledgeable about the subject area.

5. Update of Training. At least annually, Biomet shall review the training programs developed to satisfy the requirements of this Section III.C, and, where appropriate, update the training to reflect changes in Federal health care program requirements, any issues discovered during internal audits or the Arrangements Review, and any other relevant information.

6. Training Methods . Biomet may provide the training required under this CIA through videotape, DVD, appropriate computer-based training approaches, or other comparable methods not involving in-person training. If Biomet chooses to provide training pursuant to any such method, it shall also make available at reasonable times appropriately qualified and knowledgeable staff or trainers to answer questions or provide additional information to the individuals receiving such training. If Biomet chooses to provide the training required under the CIA through appropriate computer-based approaches, all applicable references to " hours" in this Section III.C. shall be " normative hours," meaning the number of hours usually required to complete the requirements of a training course through computer-based modules. (Normative hours may vary from the actual hours of training).

7. Independent Distributors . Where a Covered Person or an Arrangements Covered Person is an independent distributor, the General Training obligations under this CIA shall be met so long as the training is provided to a member of management of the independent distributor. Biomet Orthopedics shall request, and with respect to all new distributor agreements, require the independent distributor to take reasonable steps to apprise its employees and other personnel regarding the content of the training. In addition, Biomet Orthopedics shall require such entities to do the following:

a. agree to abide by the Code of Conduct or adopt its own Code of Conduct addressing substantially all of the requirements of Section III.B.1;


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b. distribute the following materials to its employees and subcontractors working on Biomet Orthopedics matters: (1) Biomet' s or its own Code of Conduct; (2) copies of relevant Biomet policies and procedures relating to the work of the independent distributor; and (3) information about Biomet' s Disclosure Program (including the hotline number);

c. provide either directly or through Biomet, Anti-Kickback Training (as described in Section III.C.2) to its employees and subcontractors to the extent they are involved with the development, approval, management, implementation, use, or review of any of Biomet Orthopedics' Arrangements; and d. certify to Biomet Orthopedics that all employees and subcontractors working on Biomet Orthopedics matters have: (1) been screened to exclude Ineligible Persons in accordance with the requirements of Section III.G of the CIA; (2) received a copy of Biomet' s Code of Conduct or its own Code of Conduct and information about Biomet' s Disclosure Program (including the hotline number); and (3) to the extent applicable, received Anti-Kickback training.

D. Compliance with the Anti-Kickback Statute .

1. Arrangements Procedures . Within 120 days after the Effective Date, Biomet and Biomet Orthopedics shall create procedures reasonably designed to ensure that each existing and new or renewed Arrangement, including Contractual Arrangements and Non-Contractual Arrangements, does not violate the Anti-Kickback Statute (taking into account the regulations, directives, and guidance related to this statute) (Arrangements Procedures). These procedures shall include the following:

a. creating and maintaining a database of all existing and new or renewed Arrangements, including Contractual Arrangements and Non-Contractual Arrangements, that shall contain the information specified in Appendix A (Arrangements Database); b. tracking remuneration to and from all parties to Arrangements;


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c. tracking service and activity logs to ensure that parties to an Arrangement are performing the services required under the applicable Arrangement;

d. monitoring the use of leased space, medical supplies, medical devices, equipment, or other patient care items to ensure that such use is consistent with the terms of the Arrangement (if applicable);

e. establishing and implementing a written review and prior approval process for all Contractual Arrangements, including but not limited to, a legal review by counsel with expertise in the Anti-Kickback Statute and appropriate documentation of all internal controls, the purpose of which is to ensure that all existing and new or renewed Contractual Arrangements do not violate the Anti-Kickback Statute;

f. establishing and implementing a written review and approval process for all Non-Contractual Arrangements, including but not limited to, an annual legal review by counsel with expertise in the Anti-Kickback Statute and appropriate documentation of all internal controls, the purpose of which is to ensure that all Non-Contractual Arrangements do not violate the Anti-Kickback Statute;

g. requiring the Compliance Officer to review the Arrangements Database, internal review and approval process, and other Arrangements Procedures on at least a quarterly basis and to provide a report on the results of such review to the Compliance Committee; and

h. implementing effective responses when suspected violations of the Anti-Kickback Statute are discovered, including disclosing Reportable Events pursuant to Section III.I (Reporting).

2. New or Renewed Arrangements . With the exception of Non-Contractual Arrangements, prior to entering into new Arrangements or renewing existing Arrangements, in addition to complying with the Arrangements Procedures set forth above, Biomet Orthopedics shall comply with the following requirements (Arrangements Requirements):

a. Ensure that each Arrangement is set forth in writing and signed by Biomet Orthopedics and the other parties to the Arrangement;


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b. Include in the written agreement a requirement that all individuals who meet the definition of Covered Persons shall comply with Biomet' s Compliance Program, including the training related to the Anti-Kickback Statute. Additionally, Biomet Orthopedics shall provide each party to the Arrangement with a copy of its Code of Conduct and any applicable Anti-Kickback Statute Policies and Procedures; and

c. Include in the written agreement a certification by the parties to the Arrangement that the parties shall not violate the Anti-Kickback Statute with respect to the performance of the Arrangement.

3. Records Retention and Access . Biomet Orthopedics shall retain and make available to OIG, upon request, the Arrangements Database and all supporting documentation of the Arrangements subject to this Section and, to the extent available, all non-privileged communications related to the Arrangements and the actual performance of the duties under the Arrangements.

E. Review Procedures .

1. General Description .

a. Engagement of Independent Review Organization . Within 120 days after the Effective Date, Biomet Orthopedics shall engage an individual or entity (or entities), such as an auditing, law or consulting firm (hereinafter " Independent Review Organization" or " IRO" ), to perform a review to assist Biomet Orthopedics in assessing its compliance with the obligations pursuant to Section III.D of this CIA (Arrangements Review).

The IRO shall assess, along with Biomet Orthopedics, whether it can perform the IRO review in a professionally independent and objective fashion, as appropriate to the nature of the engagement, taking into account any other business relationships or other


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engagements that may exist. The engagement of the IRO for the Arrangements Review shall not be deemed to create an attorney-client relationship between Biomet Orthopedics and the IRO. The other applicable requirements relating to the IRO(s) are outlined in Appendix B to this CIA, which is incorporated by reference.

b. Frequency of Arrangements Review . The Arrangements Review shall be performed annually and shall cover each of the Reporting Periods. The IRO(s) shall perform all components of each annual Arrangements Review.

c. Retention of Records . The IRO and Biomet Orthopedics shall retain and make available to OIG, upon request, all work papers, supporting documentation, correspondence, and draft reports (those exchanged between the IRO and Biomet Orthopedics) related to the reviews.

d. Responsibilities and Liabilities . Nothing in this Section III.E affects Biomet Orthopedics' responsibilities or liabilities under any criminal, civil, or administrative laws or regulations applicable to any Federal health care program including, but not limited to, the Anti-Kickback Statute.

2. Arrangements Review . The IRO shall perform a review to assess whether Biomet Orthopedics is complying with the Arrangements Procedures and Arrangements Requirements required by Sections III.D.1 and III.D.2 of this CIA. The IRO shall randomly select a sample of 50 Arrangements that were entered into or renewed during the Reporting Period. The IRO shall assess whether Biomet Orthopedics has implemented the Arrangements Procedures and, for each selected Arrangement, the IRO shall assess whether Biomet Orthopedics has complied with the Arrangements Procedures and Arrangements Requirements specifically with respect to that Arrangement. The IRO' s assessment shall include, but is not limited to: (a) verifying that the Arrangement is listed in the Arrangements Database; (b) verifying that the Arrangement was subject to the internal review and approval process (including both a legal and business review) and obtained the necessary approvals and that such review and approval is appropriately documented; (c) verifying that the remuneration related to the Arrangement is properly tracked; (d) verifying that the activity logs are properly completed and reviewed; (e) verifying (if applicable) that leased space, medical supplies,


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medical devices, and equipment, and other patient care items are properly monitored; (f) verifying that the Compliance Officer is reviewing the Arrangements Database, internal review and approval process, and other Arrangements Procedures on a quarterly basis and reporting the results of such review to the Compliance Committee; (g) verifying that effective responses are being implemented when potential violations of the Anti-Kickback Statute are discovered; and (h) verifying that Biomet Orthopedics has met the requirements of Section III.D.2. 3. Arrangements Review Report . The IRO shall prepare a report based upon each Arrangements Review performed (Arrangements Review Report). The Arrangements Review Report shall include the IRO' s findings with respect to: (a) whether Biomet Orthopedics has generally implemented the Arrangements Procedures described in Section III.D.1; and (b) specific findings as to whether Biomet Orthopedics has complied with the Arrangements Procedures and Arrangements Requirements with respect to each of the randomly selected Arrangements reviewed by the IRO. In addition, the Arrangements Review Report shall include observations, findings and recommendations, if any, on possible improvements to Biomet Orthopedics' policies, procedures, and systems in place to ensure that all Arrangements do not violate the Anti-Kickback Statute. 4. Validation Review . In the event OIG has reason to believe that: (a) Biomet Orthopedics' Arrangements Review fails to conform to the requirements of this CIA; or (b) the IRO' s findings or Arrangements Review results are inaccurate, OIG may, at its sole discretion, conduct its own review to determine whether the Arrangements Review complied with the requirements of the CIA and/or the findings or Arrangements Review results are inaccurate (Validation Review). Biomet Orthopedics shall pay for the reasonable cost of any such review performed by
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