Minneapolis / St. Paul Business Journal by Ed Stych, Web Producer
Vascular Solutions Inc. said Thursday it's facing a federal probe over allegations it sold a vein device for purposes not approved by regulators, costing the government $20 million.
Maple Grove-based Vascular (Nasdaq: VASC) said in a U.S. Securities and Exchange Commission filing that the allegations are "factually inaccurate and without merit," and it plans to defend itself.
The U.S. Attorney's Office for the Western District of Texas has intervened in a case that was filed nearly two years ago by a former Vascular sales representative.
The complaint alleges that Vascular engaged in "off-label promotion" of Vari-Lase products — especially the Vari-Lase Short Kit for the treatment of perforator veins — and provided kickbacks to physicians, the company said.
"Off-label promotion" is the practice of marketing a medical device or drug for purposes not approved by regulators.
Vascular said it has sold $410,000 worth of Vari-Lase Short Kit products from 2007 through the end of 2011. That represents less than 1 percent of the company's total U.S. sales.