Aesculap Implant Systems (AIS), a B. Braun company, announced resolution of federal investigations into matters going back over eight years through two agreements with the U.S. DOJ.

The investigation began in 2017 when AIS discovered and voluntarily disclosed unauthorized distribution of two medical devices between March and August 2017, due to the fraudulent actions of a former employee who misrepresented that U.S. Food and Drug Administration (FDA) clearance had been received for the devices.

AIS subsequently gained FDA clearance for both devices. No patient harm was reported, and the company was recognized as the victim of the fraud.

In January 2024, the former employee pleaded guilty to one felony count of violating the Federal Food, Drug, and Cosmetic Act. The individual was sentenced to a year in prison and ordered to pay restitution to AIS.

The DOJ agreed not to pursue criminal charges against AIS. The agreement reflects the company’s full cooperation with the investigation, including an internal review with improvements made to internal processes, reporting the misconduct to federal authorities, providing evidence to law enforcement, and responding promptly to government requests.

The second agreement resolves two long-standing whistleblower cases dating back nearly a decade that alleged False Claims Act violations. The settlement covers products AIS no longer sells, the Vega system knee implant and allograft tissue product and physician consulting arrangement that ended in 2017.

These allegations were addressed in earlier product liability litigation, which the company defended resulting in over half the cases being dismissed as without merit. AIS denies that it knowingly caused submission of false claims to any payor—the company said it entered the agreement to avoid the delay and expense of extended litigation.

AIS said the Vega system was successfully used in thousands of U.S. patients since its release in 2010, and thousands more worldwide. It’s never been subject to a recall and that loosenings are an “inherent and unavoidable risk of all knee implants.”

When it became evident that some surgeons were not following company recommendations or bone cement manufacturer instructions, AIS updated the Vega system’s surgical technique guide and provided training on proper cementing techniques between 2018 and 2019.