Zyno Medical: Known Infusion-Set Leaks and Continued Sales Before Recall

In the Zyno Medical infusion set settlement, Zyno Medical LLC agreed to pay $493,140 to resolve allegations that it caused false Medicare claims by selling defective sets used to administer chemotherapy and other medications. The company admitted knowing that affected sets leaked during infusions and continuing to sell them for a period before a recall. For someone inside a device business, the question is concrete: what happened to sales after the company knew the product was failing?

The Massachusetts medical device manufacturer reached the civil settlement announced by the Department of Justice on December 23, 2022. Former employees from its sales organization brought the whistleblower case. The government’s allegation followed the product into treatment paid for by Medicare.

What Zyno Admitted About the Sets

Zyno admitted that, as early as November 5, 2015, it knew certain administration sets sold for use with its Z-800 series of IV infusion pumps were defective. The defect caused leaks during medication infusion. It also admitted that it did not institute a recall until July 29, 2016, and continued selling additional affected sets for a period of time.

The administration set is the product at the center of this case. Zyno sold those sets for use with its pumps, and the government alleged that they were used to deliver controlled dosages of medication to Medicare beneficiaries. A leak during that delivery puts the defect in the middle of the treatment the government is paying for.

Zyno knew the sets leaked, yet kept selling affected product. The patient depended on the equipment to deliver medication, while taxpayers paid for the treatment. That is the decision behind the settlement: more sales after the company knew the product was failing.

How Infusion-Set Sales Reached Medicare Claims

The government alleged that Zyno caused Medicare claims connected to intravenous medication administration using devices it knew were materially defective. The alleged path ran from the manufacturer’s distribution of leaking sets to their use in treating Medicare beneficiaries and then to claims for that care.

For an infusion-set case, the sale and the Medicare bill have to be followed through the care the patient received.

A 2020 analysis of federal healthcare fraud laws in the Journal of Forensic and Investigative Accounting explains that the False Claims Act reaches a business that knowingly causes a false claim, even when someone else sends the bill. That is why the government’s allegation reached Zyno, the manufacturer supplying the sets used in treatment.

Can a Whistleblower Take Legal Action Against a Medical Device Company?

Yes. Zyno’s settlement resolved a False Claims Act qui tam case brought by a former territory manager and a former vice president of sales. The Justice Department announced that the whistleblowers would receive a share of the recovery.

The people who brought this case came from sales. A territory manager’s view of customer accounts and a sales executive’s view of the business can help explain how affected product continued to move.

For a sales employee considering a similar concern, we would want to understand what you learned about the defect, what you saw customers continue to receive and how the business responded. For a quality employee, the starting point may be the complaint history or the decision about affected product. We connect those accounts to the treatment and payment questions with you.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers. The Zyno case shows why knowledge from inside a manufacturer’s sales organization can matter to a government healthcare fraud case.

Continued Sales Appear in Other Device Complaints

In its complaint against Guidant, the government alleged that the company recommended continued sale of defective field inventory. Whistleblower complaints alleged that St. Jude Medical kept selling defective heart devices after battery corrective action, LivaNova kept selling from a lot after physician complaints about its devices, and Exactech‘s chief financial officer rejected a recall because of its financial impact.

What Evidence Is Needed to Prove Fraud?

For an infusion-set case like Zyno’s, the useful evidence connects knowledge of the defect, sales of affected sets, their use in treatment and the resulting Medicare claims. We examine how those pieces fit and what your position inside the business lets you explain.

The first connection is between the product problem and the company’s knowledge. A customer complaint may describe a leak, while testing or an internal review may explain the defect. Manufacturers receive much of the device adverse-event information flowing from facilities and importers. That makes the company’s internal account of a problem important when comparing what it knew with what happened in the market.

The next connection is commercial. We compare the affected product identified in the quality account with sales after the company learned of the problem. Which sets continued to move, who approved their sale and what customers were told are the questions that make the chronology useful. A dated complaint and a dated sale become much more informative when someone can explain why they concern the same affected product.

The final connection is to care and payment. We examine which treatment used the affected product and which Medicare claim corresponds to that care. Product records, clinical records and billing records can contribute different parts of the account.

This is where a conversation with an insider becomes valuable. You may understand why an order went out after a complaint, how affected stock was identified or what a customer was told about a leak. We work with that specific knowledge to develop the case, bringing the product decision and the government payment into the same account.

You Saw What Happened After the Leak

If you saw affected infusion sets keep selling after the company knew they leaked, speak to one of our Whistleblower Experts about what happened after the leaks were known. We build the case with you, bring in medical device whistleblower lawyers who understand defective-product sales and Medicare claims, and stay beside you through the pursuit of a recovery.