Former VP of Genetic Test Company Pleads Guilty to Paying Doctors Illegal Kickbacks
/By Pat Anson, PNN Editor
The former vice-president of marketing for a controversial genetic testing company has pleaded guilty in federal court to paying physicians millions of dollars in illegal kickbacks to order genetic tests for Medicare patients.
Donald Matthews, who was Vice President of Market Development for Proove Biosciences, pleaded guilty this week in federal court. Matthews faces up to 5 years in prison and a $250,000 fine when he’s sentenced in October.
Proove filed for bankruptcy in 2017 after its headquarters in Irvine, California was raided by FBI agents. The company specialized in DNA testing that supposedly identified whether a patient is at risk of opioid addiction and what medications would best treat their pain. Proove said its tests, which cost thousands of dollars, were proven effective in peer-reviewed clinical studies, but a genetic expert told STAT News the studies were “hogwash.”
According to Matthews’ plea agreement, Proove paid doctors at least $3.5 million to induce them to order DNA tests for their patients. The company then billed Medicare approximately $45 million to pay for the tests and received about $21 million in unlawful payments.
“Proove concealed the true nature of the kickbacks by falsely characterizing the payments as compensation for participating in a clinical research program sponsored by Proove,” the U.S. Attorney’s Office in San Diego said in a statement. “In furtherance of the scheme, Proove placed its own employees in doctors’ offices. The Proove employees collected a cheek swab and completed most of the paperwork associated with the ‘clinical research’ program.”
Prosecutors say Proove paid kickbacks to an undisclosed number of doctors throughout the country, with the payments tied to how many DNA tests that a doctor ordered. When doctors complained about delayed or reduced payments, a Proove executive demanded that they increase their testing volume.
“Kickbacks corrupt the medical judgment of physicians, generate unnecessary tests and treatments, increase health care costs, and create unfair competition,” said U.S. Attorney Robert Brewer.
‘A Waste of Time and Money’
As PNN has reported, a non-profit healthcare system in Great Falls, Montana had a Proove “patient engagement representative” employed on site at the Benefis Pain Management Center.
“We had a meeting one day and here are these people from Proove Biosciences. They told us they were doing a research project,” said Rodney Lutes, a physician assistant who was later fired by Benefis. “They wanted to come to Benefis, into the pain department, and test our patients. We were told this would be at no cost to the patient. My understanding was that they weren’t going to charge anybody, but I found out afterwards they were charging insurance companies.
“They said providers who participated in this would get some form of payment for participating in the program and for filling out all the paperwork.”
Lutes’ supervising physician at the clinic was Katrina Lewis, MD, a pain management specialist at Benefis who was on Proove’s Medical Advisory Board. Benefis has denied that Lewis or any of its employees received kickbacks from Proove for referring business to them. The clinic also said the DNA tests were voluntary and only done on patients if they were appropriate.
A copy of the clinic’s opioid policy obtained by PNN indicates the tests were mandatory for some patients.
“All patients on dosing levels at or higher than the maximum policy dose MUST be submitted for genetic testing,” the policy states.
Proove had two types of tests for patients in pain management, an “Opioid Risk Test” and an “Opioid Risk Profile.” According to Proove, the tests could determine a patient’s risk of abusing pain medication.
A Benefis patient who took the tests said they were “a waste of time and money.”
“The meds it said I should be taking either didn’t work, stopped working, or made me sick. And the meds I should not be taking I do just fine on,” she told PNN.
