Exhibit 10.3
CORPORATE INTEGRITY AGREEMENT
between the
Office of Inspector General
of the
Department of Health and Human Services
and
Spectranetics Corporation
I. Preamble
The Spectranetics Corporation (Spectranetics) hereby enters into this Corporate
Integrity Agreement (CIA) with the Office of Inspector General (OIG) of the
United States Department of Health and Human Services (HHS) to promote
compliance with the statutes, regulations, and written directives of Medicare,
Medicaid, and all other Federal health care programs (as defined in 42 U.S.C. §
1320a-7b(f)) (Federal health care program requirements) and with the statutes,
regulations, and written directives of the Food and Drug Administration (FDA
requirements). Contemporaneously with this CIA, Spectranetics is entering into a
Settlement Agreement with the United States.
Spectranetics represents that before the effective date of this CIA (as defined
below) and before commencement of the government’s investigation, Spectranetics
initiated a voluntary compliance program applicable to all Spectranetics
employees. Spectranetics’s compliance program (Compliance Program) includes a
Chief Compliance Officer, who reports to the Board of Directors and the Chief
Executive Officer, a Board of Directors Compliance Committee, and a Management
Compliance Committee. The Compliance Program also includes a Code of Conduct for
all employees, written policies and procedures, educational and training
initiatives, review and disciplinary procedures, a disclosure program that
allows for the confidential disclosure and investigation of potential compliance
violations and appropriate disciplinary procedures, an ineligible persons
screening program, and regular internal audit and review procedures, an
arrangements database and a Commercial Activities and Grants Committee to
monitor Anti-kickback statute compliance.
Spectranetics shall continue its Compliance Program throughout the term of this
CIA and shall do so in accordance with the terms set forth below. Spectranetics
may modify its Compliance Program as appropriate, but, at a minimum,
Spectranetics shall ensure that during the term of this CIA it shall comply with
the obligations enumerated herein.

 

 

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II. Term and Scope of the CIA
A. The period of the compliance obligations assumed by Spectranetics under this
CIA shall be five 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, IX, X, and XI shall expire no later than 120 days after OIG=s
receipt of: (1) Spectranetics’ final annual report; or (2) any additional
materials submitted by Spectranetics pursuant to OIG=s request, whichever is
later.
C. The scope of this CIA shall be governed by the following definitions:
1. “Covered Persons” includes:
a. all owners of Spectranetics who are natural persons, (other than shareholders
who: (1) have an ownership interest of less than 5%; and (2) acquired the
ownership interest through public trading);
b. all officers and directors of Spectranetics; all U.S.-based employees of
Spectranetics; and all employees of Spectranetics who are based outside the
United States and have responsibilities relating to Promotional and Product
Services Related Functions (as defined below in Section II.C.2) in the U.S.,
Clinical Investigation Related Functions related to FDA requirements (as defined
below in Section II.C.3), or Reporting Related Functions (as defined below in
Section II.C.4);
c. all contractors, subcontractors, agents, and other persons who perform
Promotional and Product Services Related Functions (as defined below in
Section II.C.2) on behalf of Spectranetics;
d. all contractors, subcontractors, agents, and other persons who perform
Clinical Investigation Related Functions (as defined below in Section II.C.3) on
behalf of Spectranetics and
e. all contractors, subcontractors, agents, and other persons who perform
Reporting Related Functions (as defined below in Section II.C.4) on behalf of
Spectranetics.
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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.
2. “Promotional and Product Services Related Functions” includes: (a) the
selling, detailing, marketing, advertising, and promotion of Spectranetics
products; and (b) the preparation and dissemination of materials or information
about, or the provision of services relating to, devices that are distributed
within the United States.
3. “Clinical Investigation Related Functions” includes organizing, coordinating,
administering, providing training for, monitoring, and FDA reporting related to
clinical investigations and patient registries as well as all relevant
obligations under FDA’s Investigational Device Exemption regulations, 21 C.F.R.
Part 812.
4. “Reporting Related Functions” includes identifying, tracking, and gathering
information and preparing and submitting reports to the FDA for Spectranetics
devices. This includes reporting of adverse events (including reports required
under 21 U.S.C. § 360i and the Medical Device Reporting (MDR) regulation at 21
C.F.R. Part 803 and other reporting under FDA requirements, (including those
required under 21 C.F.R. § 814.84).
5. “Relevant Promotional and Product Services Covered Persons” includes all
Covered Persons whose job responsibilities relate to Promotional and Product
Services Related Functions.
6. “Relevant Clinical Investigation Covered Persons” includes all Covered
Persons whose job responsibilities relate to Clinical Investigation Related
Functions.
7. “Relevant Reporting Covered Persons” includes all Covered Persons whose job
responsibilities relate to Reporting Related Functions.
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III. Corporate Integrity Obligations
Spectranetics shall establish and maintain a Compliance Program that includes
the following elements:
A. Chief Compliance Officer and Committee.
1. Chief Compliance Officer. Prior to the Effective Date, Spectranetics
appointed a Chief Compliance Officer and Spectranetics shall maintain a Chief
Compliance Officer for the term of the CIA. The Chief 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, with Federal health care program requirements and with FDA requirements.
The Chief Compliance Officer shall be a member of senior management of
Spectranetics, shall make periodic (at least quarterly) reports regarding
compliance matters directly to the Board of Directors of Spectranetics, and
shall be authorized to report on such matters to the Board of Directors at any
time. The Chief Compliance Officer shall not be or be subordinate to the General
Counsel or Chief Financial Officer. The Chief Compliance Officer shall be
responsible for monitoring the day-to-day compliance activities engaged in by
Spectranetics as well as for any reporting obligations created under this CIA.
Any noncompliance job responsibilities of the Chief Compliance Officer shall be
limited and must not interfere with the Chief Compliance Officer’s ability to
perform the duties outlined in this CIA.
Spectranetics shall report to OIG, in writing, any changes in the identity or
position description of the Chief Compliance Officer, or any actions or changes
that would affect the Chief Compliance Officer’s ability to perform the duties
necessary to meet the obligations in this CIA, within 5 days after such a
change.
2. Compliance Committee. Prior to the Effective Date, Spectranetics formed a
Board of Directors Compliance Committee (Board Compliance Committee), consisting
of two non-management members of the Board. Spectranetics also formed a
Management Compliance Committee (Compliance Committee), consisting of the Chief
Compliance Officer and other members of senior management, including the Chief
Operating Officer; the Chief Financial Officer; the General Counsel, the Senior
Vice President, Vascular Intervention and Lead Management; Vice President,
Clinical Affairs; and the Chief Compliance Officer. Spectranetics’s Compliance
Committee shall continue to have members of senior management necessary to meet
the requirements of this CIA, (e.g. senior executives of relevant departments,
such as legal, regulatory affairs, clinical affairs, finance, and vascular
intervention and lead management). Spectranetics shall maintain a Compliance
Committee and Board Compliance Committee for the term of the CIA. The Chief
Compliance Officer shall chair the Compliance Committee and the Committee shall
support the Chief Compliance Officer in fulfilling his/her responsibilities
(e.g., shall assist in the analysis of the organization’s risk areas and shall
oversee monitoring of internal and external audits and investigations).
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Spectranetics 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.
3. Board of Directors Compliance Obligations. Spectranetics’ Board of Directors
shall be responsible for the review and oversight of matters related to
compliance with Federal health care program requirements, FDA requirements, and
the obligations of this CIA.
a. The Board shall meet at least quarterly to review and oversee Spectranetics’
Compliance Program, including but not limited to receiving reports from the
Chief Compliance Officer to evaluate the effectiveness of Spectranetics’
Compliance Program, Chief Compliance Officer, and Compliance Committee. The
Board may also meet with the Board Compliance Committee and the Compliance
Committee to evaluate the effectiveness of Spectranetics’ Compliance Program,
Chief Compliance Officer, and Compliance Committee.
b. For each Reporting Period of the CIA, the Board shall, in reliance upon the
aforementioned reports and its reasonable further inquiry, adopt a resolution,
signed by each individual member of the Board, summarizing its review and
oversight of Spectranetics’ compliance with Federal health care program
requirements, FDA requirements, and obligations of this CIA.
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  i.   Resolution: At a minimum, the resolution shall address whether:

  (a)   The Board has made a reasonable inquiry into the effectiveness of
Spectranetics’ Compliance Program for the Reporting Period; and     (b)   Based
on its reasonable inquiry, the Board concludes that Spectranetics is
implementing an effective Compliance Program.     (c)   If the Board is unable
to reach a conclusion that Spectranetics has implemented an effective Compliance
Program, the Board shall include in the resolution a written explanation of the
reason(s) why it has been unable to reach such a conclusion and the steps that
it is taking to implement an effective compliance program.

  ii.   The Board resolution and any attachments shall be submitted with
Spectranetics’ Annual Report to the OIG.

B. Written Standards.
1. Code of Conduct. Within 120 days after the Effective Date, Spectranetics
shall develop, implement, and distribute a revised written Code of Conduct to
all Covered Persons. Spectranetics shall make the promotion of, and adherence
to, the Code of Conduct an element in evaluating the performance of all
employees. The Code of Conduct shall, at a minimum, set forth:
a. Spectranetics’ commitment to full compliance with all FDA and Federal health
care program requirements;
b. Spectranetics’ requirement that all of its Covered Persons shall be expected
to comply with all FDA and all Federal health care program requirements and with
Spectranetics’ own Policies and Procedures as implemented pursuant to
Section III.B (including the requirements of this CIA);
c. the requirement that all of Spectranetics’ Covered Persons shall be expected
to report to the Chief Compliance Officer, or other appropriate individual
designated by Spectranetics, suspected violations of any FDA or Federal health
care program requirements or of Spectranetics’ own Policies and Procedures; and
d. the right of all individuals to use the Disclosure Program described in
Section III.E, and Spectranetics’ commitment to nonretaliation and to maintain,
as appropriate, confidentiality and anonymity with respect to such disclosures.
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Within 120 days after the Effective Date, each Covered Person shall certify, in
writing or electronically, that he or she has received, read, understood, and
shall abide by Spectranetics’ Code of Conduct. Spectranetics shall maintain
documentation of such certification. 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 120 days after the Effective Date, whichever
is later. Spectranetics shall maintain documentation of the Code of Conduct
certifications consistent with section VIII of the CIA.
Spectranetics 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, 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. To the extent not already accomplished, within
120 days after the Effective Date, Spectranetics shall implement written
Policies and Procedures regarding the operation of Spectranetics’ compliance
program and its compliance with Federal health care program and FDA
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 appropriate manner in which to conduct Promotional and Product Services
Related Functions and Clinical Investigation Related Functions in compliance
with all applicable Federal healthcare program requirements, including, but not
limited to the False Claims Act (codified at 31 U.S.C. § 3729-3733), and the
Federal anti-kickback statute (codified at 42 U.S.C. § 1320a-7b);
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c. The appropriate manner in which to conduct Promotional and Product Services
Related Functions and Clinical Investigation Related Functions in compliance
with all applicable FDA requirements, including the requirements applicable to
investigational devices under 21 C.F.R. §812.7;
d. The materials and information that may be distributed by Spectranetics sales
representatives and account executives about Spectranetics’ products and the
manner in which Spectranetics sales representatives and account executives
respond to requests for information about unapproved or uncleared uses (or “off
label” uses) of Spectranetics’ products;
e. The materials and information that may be distributed by Spectranetics’
Medical Services Department and the mechanisms through, and manner in which,
such medical personnel receive and respond to requests for information about
off-label uses of the products; the form and content of the information
disseminated by Spectranetics in response to such requests; and the internal
review process for the information disseminated.
The Policies and Procedures shall include a requirement that Spectranetics
develop a database (Inquiry Database) to track all requests for information
about Spectranetics’ products that are submitted by Spectranetics’ sales
representatives and account executives or by physicians or members of the public
regarding off-label uses of Spectranetics products. The Inquiry Database shall
include the following items of information for each inquiry received for
information about Spectranetics’ products: 1) date of inquiry; 2) form of
inquiry (e.g., email, letter, fax, phone, etc.); 3) name of the requesting
health care professional (HCP) or health care institution (HCI) in accordance
with applicable privacy laws; 4) nature and topic of the request, including the
exact language of the inquiry; 5) the nature/form of the response from
Spectranetics to the HCP or HCI in response to the request; 6) the name of the
Spectranetics representative or account executive who called on or interacted
with the HCP or HCI, if known;
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f. The appropriate manner in which to conduct Reporting Related Functions in
compliance with all applicable FDA requirements;
g. The protection of human subjects, as required by 45 C.F.R. Part 45 and 21
C.F.R. Parts 50 and 56, and financial disclosure, as required by 21 C.F.R.
Part 54;
h. Systems, processes, policies and procedures for ensuring that all devices
Spectranetics introduces or causes to be introduced into interstate commerce are
the subject of: (1) an FDA-approved pre-market approval application, under 21
U.S.C. § 360e(a)(2) and 21 C.F.R. Part 814; (2) a “510(k) clearance” by FDA for
marketing because it is found to be substantially equivalent to an appropriate,
legally marketed device, under 21 U.S.C. §§ 360c(a)(1) and 360(k) and 21 C.F.R.
Part 807 — Subpart E; (3) an investigational device exemption under 21 U.S.C.
§ 360j(g), for the use of a device on humans on an experimental basis; or (4) an
exemption for certain devices as set forth in 21 U.S.C. § 360(l); and
i. Disciplinary policies and procedures for violations of Spectranetics’ Code of
Conduct and Policies and Procedures.
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. Appropriate and knowledgeable staff
shall be available to explain the Policies and Procedures.
At least annually (and more frequently, if appropriate), Spectranetics 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 individuals whose
job functions relate to those Policies and Procedures.
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C. Training and Education.
1. General Training. Within 120 days after the Effective Date, Spectranetics
shall provide at least two hours of General Training to each Covered Person.
This training, at a minimum, shall explain Spectranetics’:
a. CIA requirements; and
b. Spectranetics’ 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.
2. Specific Promotional and Product Services Training. Within 120 days after the
Effective Date, each Relevant Promotional and Product Services Covered Person
shall receive at least 4 hours of Specific Promotional and Product Services
Training in addition to the General Training required above. This Specific
Training shall include a discussion of:
a. all applicable Federal health care program and FDA requirements and all
Spectranetics’ Policies and Procedures relating to Promotional and Product
Services Related Functions;
b. the personal obligation of each individual involved in Promotional and
Product Services Related Functions to comply with all applicable Federal health
care program and FDA requirements and with Spectranetics Policies and
Procedures;
c. the legal sanctions for violations of the Federal health care program and FDA
requirements, the False Claims Act, and the Anti-kickback statute;
d. examples of proper and improper practices related to Promotional and Product
Services Related Functions; and
e. the possible consequences to both Spectranetics and Relevant Covered
Promotional and Product Services Persons of failure to comply with FDA and
Federal health care program requirements and with Spectranetics’ own Policies
and Procedures and the failure to report such noncompliance.
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New Relevant Promotional and Product Services Covered Persons shall receive this
training within 30 days after the beginning of their employment or becoming
Relevant Promotional and Product Services Covered Persons, or within 120 days
after the Effective Date, whichever is later. A Spectranetics employee who has
completed the Specific Promotional and Product Services Training shall review a
new Relevant Promotional and Product Services Covered Person’s work, to the
extent that the work relates to Promotional and Product Services Functions,
until such time as the new Relevant Promotional and Product Services Covered
Person completes his or her Specific Promotional and Product Services Training.
After receiving the initial Specific Promotional and Product Services Training
described in this Section, each Relevant Promotional and Product Services
Covered Person shall receive at least three hours of Specific Promotional and
Product Services Training in each subsequent Reporting Period.
3. Specific Clinical Investigation and Reporting Training. Within 120 days after
the Effective Date, each Relevant Clinical Investigation Covered Person and
Reporting Covered Person shall receive at least 4 hours of Specific Clinical
Investigation and Reporting Training in addition to the General Training
required above. This Specific Clinical Investigation and Reporting Training
shall include a discussion of:
a. all applicable Federal health care program and FDA requirements and all
Spectranetics’ Policies and Procedures relating to Clinical Investigation
Related Functions and Reporting Related Functions;
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b. the personal obligation of each individual involved in Clinical Investigation
Related Functions and Reporting Related Functions to comply with all applicable
Federal health care program and FDA requirements and with Spectranetics’
Policies and Procedures, including the requirement to submit complete and
accurate information to the FDA;
c. the legal sanctions for violations of the Federal health care program and FDA
requirements;
d. examples of proper and improper practices related to Clinical Investigation
Related Functions and Reporting Related Functions, including those that address
the following issues:
(i) when a patient registry is, in fact, a clinical investigation;
(ii) when FDA approval, FDA clearance, or an applicable Investigational Device
Exemption is necessary for interstate distribution of a device; and
(iii) the receipt, investigation, and evaluation of events and the record
keeping requirements under 21 C.F.R. § 803.17(b); and
e. the possible consequences to both Spectranetics and Relevant Clinical
Investigation Covered Persons and Relevant Reporting Covered Persons of failure
to comply with FDA and Federal health care program requirements and with
Spectranetics’ own Policies and Procedures and the failure to report such
noncompliance.
New Relevant Clinical Investigation Covered Persons and New Relevant Reporting
Covered Persons shall receive this training within 30 days after the beginning
of their employment or becoming Relevant Clinical Investigation Covered Persons
or Relevant Reporting Covered Persons, or within 120 days after the Effective
Date, whichever is later. A Spectranetics who has completed the Specific
Clinical Investigation and Reporting Training shall review (a) a new Relevant
Clinical Investigation Covered Person’s work, to the extent that the work
relates to Clinical Investigation Related Functions, until such time as the new
Relevant Clinical Investigation Covered Person completes his or her Specific
Training and (b) a new Relevant Reporting Covered Person’s work, to the extent
that the work relates to Reporting Related Functions, until such time as the new
Relevant Reporting Covered Person completes his or her Specific Training.
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After receiving the initial Specific Clinical Investigation and Reporting
Training described in this Section, each Relevant Clinical Investigation Covered
Person and Relevant Reporting Covered Person shall receive at least three hours
of Specific Clinical Investigation and Reporting Training in each subsequent
Reporting Period.
4. Certification. Each individual who is required to attend training shall
certify, in writing, or in electronic form, if applicable, that he or she has
received the required training. The certification shall specify the type of
training received and the date received. The Chief Compliance Officer (or
designee) shall retain the certifications, along with all course materials.
These shall be made available to OIG, upon request.
5. Qualifications of Trainer. Persons providing the training shall be
knowledgeable about the subject area, including applicable Federal health care
program and FDA requirements.
6. Update of Training. Spectranetics shall review the training annually, and,
where appropriate, update the training to reflect changes in Federal health care
program and FDA requirements, any issues discovered during internal audits or
the IRO Review, and any other relevant information.
7. Computer-based Training. Spectranetics may provide the training required
under this CIA through appropriate computer-based training approaches. If
Spectranetics chooses to provide computer-based training, it shall make
available appropriately qualified and knowledgeable staff or trainers to answer
questions or provide additional information to the individuals receiving such
training.
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D. Review Procedures.
1. General Description.
a. Engagement of Independent Review Organization. Within 120 days after the
Effective Date, Spectranetics shall engage an entity (or entities), such as an
accounting, auditing, or consulting firm (hereinafter “Independent Review
Organization” or “IRO”), to perform reviews to assist Spectranetics in assessing
and evaluating its Clinical Investigation Related Functions, Reporting Related
Functions, and certain of its Promotional and Product Services Related
Functions. The applicable requirements relating to the IRO are outlined in
Appendix A to this CIA, which is incorporated by reference.
Each IRO engaged by Spectranetics shall have expertise in applicable Federal
health care program and FDA requirements as may be appropriate for the Review
for which the IRO is retained. Each IRO shall assess, along with Spectranetics,
whether it can perform the engagement in a professionally independent and
objective fashion, as appropriate to the nature of the review, taking into
account any other business relationships or other engagements that may exist.
The IRO(s) shall conduct reviews that assess Spectranetics’ systems, processes,
policies, procedures, and practices relating to Clinical Investigation Related
Functions, Reporting Related Functions and Promotional and Product Services
Related Functions (collectively, “IRO Review”).
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b. Frequency and Brief Description of Reviews. As set forth more fully in
Appendix B, the IRO Review shall consist of two components – a Systems Review
and a Transaction Review.
i. Systems Review. The Systems Review shall assess Spectranetics’ systems,
processes, policies, and procedures relating to Clinical Investigation Related
Functions, Reporting Related Functions, and Promotional and Product Services
Related Functions. If there are no material changes in Spectranetics’ systems,
processes, policies, and procedures relating to Clinical Investigation Related
Functions, Reporting Related Functions, and Promotional and Product Services
Related Functions, the Systems Review shall be performed in the first and fourth
Reporting Periods. If Spectranetics materially changes its systems, processes,
policies, and procedures relating to Clinical Investigation Related Functions,
Reporting Related Functions, and Promotional and Product Services Related
Functions, the IRO shall perform a Systems Review for the Reporting Period in
which such changes were made in addition to conducting the Systems Review for
the first and fourth Reporting Periods.
ii. Transactions Review. The Transactions Review shall be performed annually and
shall cover each of the five Reporting Periods. The IRO(s) shall perform all
components of each annual Transactions Review.
c. Retention of Records. The IRO and Spectranetics shall retain and make
available to OIG, upon request, all work papers, supporting documentation,
correspondence, and draft reports (those exchanged between the IRO and
Spectranetics) related to the reviews.
2. IRO Review Reports. The IRO shall prepare a report (or reports) based upon
each Review performed (IRO Review Report). Information to be included in the IRO
Review Report is described in Appendix B.
3. Validation Review. In the event OIG has reason to believe that: (a) any IRO
Review fails to conform to the requirements of this CIA; or (b) the IRO’s
findings or Review are inaccurate, OIG may, at its sole discretion, conduct its
own review to determine whether the applicable Review complied with the
requirements of the CIA and/or the findings or Review results are inaccurate
(Validation Review). Spectranetics shall pay for the reasonable cost of any such
review performed by OIG or any of its designated agents. Any Validation Review
of Reports submitted as part of Spectranetics’ final Annual Report shall be
initiated no later than one year after Spectranetics’ final submission (as
described in Section II) is received by OIG.
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Prior to initiating a Validation Review, OIG shall notify Spectranetics of its
intent to do so and provide a written explanation of why OIG believes such a
review is necessary. To resolve any concerns raised by OIG, Spectranetics may
request a meeting with OIG to: (a) discuss the results of any Review submissions
or findings; (b) present any additional information to clarify the results of
the applicable Review or to correct the inaccuracy of the Review; and/or
(c) propose alternatives to the proposed Validation Review. Spectranetics agrees
to provide any additional information as may be requested by OIG under this
Section III.D.3 in an expedited manner. OIG will attempt in good faith to
resolve any Review issues with Spectranetics prior to conducting a Validation
Review. However, the final determination as to whether or not to proceed with a
Validation Review shall be made at the sole discretion of OIG.
4. Independence and Objectivity Certification. The IRO shall include in its
report(s) to Spectranetics a certification or sworn affidavit that it has
evaluated its professional independence and objectivity, as appropriate to the
nature of the engagement, with regard to the applicable Review and that it has
concluded that it is, in fact, independent and objective.
E. Disclosure Program.
To the extent not already accomplished, within 120 days after the Effective
Date, Spectranetics shall establish a Disclosure Program that includes a
mechanism (e.g., a toll-free compliance telephone line) to enable individuals to
disclose, to the Chief Compliance Officer or some other person who is not in the
disclosing individual’s chain of command, any identified issues or questions
associated with Spectranetics’ policies, conduct, practices, or procedures with
respect to a Federal health care program or FDA requirements believed by the
individual to be a potential violation of criminal, civil, or administrative
law. Spectranetics shall appropriately publicize the existence of the disclosure
mechanism (e.g., via periodic “all-hands meetings,” newsletters and/or e-mails
to employees or by posting the information in prominent common areas).
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The Disclosure Program shall emphasize a nonretribution, nonretaliation policy,
and shall include a reporting mechanism for anonymous communications for which
appropriate confidentiality shall be maintained. Upon receipt of a disclosure,
the Chief Compliance Officer (or designee) shall gather all relevant information
from the disclosing individual. The Chief Compliance Officer (or designee) shall
make a preliminary, good faith inquiry into the allegations set forth in every
disclosure to ensure that he or she has obtained all of the information
necessary to determine whether a further review should be conducted. For any
disclosure that is sufficiently specific so that it reasonably: (1) permits a
determination of the appropriateness of the alleged improper practice; and
(2) provides an opportunity for taking corrective action, Spectranetics shall
conduct an internal review of the allegations set forth in the disclosure and
ensure that proper follow-up is conducted.
The Chief Compliance Officer (or designee) shall maintain a disclosure log,
which shall include a record and summary of each disclosure received (whether
anonymous or not), the status of the respective internal reviews, and any
corrective action taken in response to the internal reviews. The disclosure log
shall be made available to OIG upon request.
F. Ineligible Persons.
1. Definitions. For purposes of this CIA:
a. an “Ineligible Person” shall include an individual or entity who:
i. is currently excluded, debarred, suspended, or otherwise ineligible to
participate in the Federal health care programs or in Federal procurement or
nonprocurement programs; or
ii. has been convicted of a criminal offense that falls within the scope of 42
U.S.C. § 1320a-7(a), but has not yet been excluded, debarred, suspended, or
otherwise declared ineligible.
b. “Exclusion Lists” include:
i. the HHS/OIG List of Excluded Individuals/Entities (available through the
Internet at http://www.oig.hhs.gov); and
ii. the General Services Administration’s List of Parties Excluded from Federal
Programs (available through the Internet at http://www.epls.gov).
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2. Screening Requirements. Spectranetics shall ensure that all prospective and
current Covered Persons are not Ineligible Persons, by implementing the
following screening requirements.
a. Spectranetics shall screen all prospective and current Covered Persons
against the Exclusion Lists prior to engaging their services and, as part of the
hiring or contracting process, shall require such Covered Persons to disclose
whether they are Ineligible Persons.
b. Spectranetics shall screen all Covered Persons against the Exclusion Lists
within 120 days after the Effective Date and on an annual basis thereafter.
c. Spectranetics shall implement a policy requiring all Covered Persons to
disclose immediately any debarment, exclusion, suspension, or other event that
makes that person an Ineligible Person.
Nothing in this Section affects the responsibility of (or liability for)
Spectranetics to refrain from billing Federal health care programs for items or
services furnished, ordered, or prescribed by an Ineligible Person.
Spectranetics understands that items or services furnished by excluded persons
are not payable by Federal health care programs and that Spectranetics may be
liable for overpayments and/or criminal, civil, and administrative sanctions for
employing or contracting with an excluded person regardless of whether
Spectranetics meets the requirements of Section III.F.
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3. Removal Requirement. If Spectranetics has actual notice that a Covered Person
has become an Ineligible Person, Spectranetics shall remove such Covered Person
from responsibility for, or involvement with, Spectranetics’ business operations
related to the Federal health care programs and shall remove such Covered Person
from any position for which the Covered Person’s compensation or the items or
services furnished, ordered, or prescribed by the Covered Person are paid in
whole or part, directly or indirectly, by Federal health care programs or
otherwise with Federal funds at least until such time as the Covered Person is
reinstated into participation in the Federal health care programs.
4. Pending Charges and Proposed Exclusions. If Spectranetics has actual notice
that a Covered Person is charged with a criminal offense that falls within the
scope of 42 U.S.C. §§ 1320a-7(a), 1320a-7(b)(1)-(3), or is proposed for
exclusion during the Covered Person’s employment or contract term, Spectranetics
shall take all appropriate actions to ensure that the responsibilities of that
Covered Person have not and shall not adversely affect the accuracy of any
claims submitted to any Federal health care program.
G. Notification of Government Investigation or Legal Proceedings.
Within 30 days after discovery, Spectranetics shall notify OIG, in writing, of
any ongoing investigation or legal proceeding known to Spectranetics conducted
or brought by a governmental entity or its agents involving an allegation that
Spectranetics has committed a crime or has engaged in fraudulent activities.
This notification shall include a description of the allegation, the identity of
the investigating or prosecuting agency, and the status of such investigation or
legal proceeding. Spectranetics shall also provide written notice to OIG within
30 days after the resolution of the matter, and shall provide OIG with a
description of the findings and/or results of the investigation or proceedings,
if any.
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H. Reporting.
1. Reportable Events.
a. Definition of Reportable Event. For purposes of this CIA, a “Reportable
Event” means anything that involves:
i. a matter that a reasonable person would consider a probable violation of
criminal, civil, or administrative laws applicable to FDA requirements and/or
applicable to any Federal health care program for which penalties or exclusion
may be authorized; or
ii. an adverse event that Spectranetics: (1) was required to report as an MDR
and (2) failed to report to the FDA under 21 U.S.C. § 360i and 21 C.F.R.
Part 803 within 30 days; or
iii. the filing of a bankruptcy petition by Spectranetics.
A Reportable Event may be the result of an isolated event or a series of
occurrences.
b. Reporting of Reportable Events. If Spectranetics determines (after a
reasonable opportunity to conduct an appropriate review or investigation of the
allegations) through any means that there is a Reportable Event, Spectranetics
shall notify OIG, in writing, within 30 days after making the determination that
the Reportable Event exists. The report to OIG shall include the following
information:
i. a complete description of the Reportable Event, including the relevant facts,
persons involved, and legal and Federal health care program and/or FDA
authorities implicated;
ii. a description of Spectranetics’ actions taken to correct the Reportable
Event;
iii. any further steps Spectranetics plans to take to address the Reportable
Event and prevent it from recurring;
iv. If the Reportable Event involves the filing of a bankruptcy petition, the
report to the OIG shall include documentation of the filing and a description of
any Federal health care program and/or FDA authorities implicated.
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I. Notification of Communication with FDA.
Within 30 days after the date of any written report, correspondence, or
communication between Spectranetics and the FDA that materially discusses
Spectranetics’ or a Covered Person’s actual or potentially unlawful or improper
promotion of Spectranetics’ products (including any improper dissemination of
information about off-label indications) or improper practices relating to
Clinical Investigation Related Functions, Spectranetics shall provide a copy of
the report, correspondence or communications to the OIG. Spectranetics shall
also provide written notice to the OIG within 30 days after the resolution of
any matter disclosed in accordance with the requirements set forth above, and it
shall provide the OIG with a description of the findings and/or results of the
matter, if any.
IV. Changes to Business Units or Locations
A. Change or Closure of Unit or Location. In the event that, after the Effective
Date, Spectranetics changes locations or closes a business unit or location
engaged in Promotional or Product Services Related Functions, Reporting Related
Functions, or Clinical Investigation Related Functions, Spectranetics shall
notify OIG of this fact as soon as possible, but no later than within 30 days
after the date of change or closure of the location.
B. Purchase or Establishment of New Unit or Location. In the event that, after
the Effective Date, Spectranetics purchases or establishes a new business unit
or location engaged in Promotional or Product Services Related Functions,
Reporting Related Functions, or Clinical Investigation Related Functions,
Spectranetics shall notify OIG at least 30 days prior to such purchase or the
operation of the new business unit or location. This notification shall include
the address of the new business unit or location, phone number, fax number,
Federal health care provider number and/or supplier number (if applicable), and
the name and address of the contractor that issued each number (if applicable).
Each new business unit or location and all Covered Persons at each new business
unit or location shall be subject to the applicable requirements of this CIA.
C. Sale of Unit or Location. In the event that, after the Effective Date,
Spectranetics proposes to sell any or all of its business units or locations
that are subject to this CIA, Spectranetics shall notify OIG of the proposed
sale at least 30 days prior to the sale of such business unit or location. This
notification shall include a description of the business unit or location to be
sold, a brief description of the terms of the sale, and the name and contact
information of the prospective purchaser. This CIA shall be binding on the
purchaser of such business unit or location, unless otherwise determined and
agreed to in writing by the OIG.
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V. Implementation and Annual Reports
A. Implementation Report. Within 150 days after the Effective Date,
Spectranetics shall submit a written report to OIG summarizing the status of its
implementation of the requirements of this CIA (Implementation Report). The
Implementation Report shall, at a minimum, include:
1. the name, address, phone number, and position description of the Chief
Compliance Officer required by Section III.A.1, and a summary of other
noncompliance job responsibilities the Chief Compliance Officer may have;
2. the names and positions of the members of the Compliance Committee required
by Section III.A.2;
3. the names of the members Spectranetics’ Board of Directors referenced in
Section III.A.3;
4. a copy of Spectranetics’ Code of Conduct required by Section III.B.1;
5. a copy of all Policies and Procedures required by Section III.B.2;
6. the number of individuals required to complete the Code of Conduct
certification required by Section III.B.1, the percentage of individuals who
have completed such certification, and an explanation of any exceptions (the
documentation supporting this information shall be available to OIG, upon
request);
7. the following information regarding each type of training required by
Section III.C:
a. a description of such training, including a summary of the topics covered,
the length of sessions, and a schedule of training sessions; and
b. the number of individuals required to be trained, percentage of individuals
actually trained, and an explanation of any exceptions.
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A copy of all training materials and the documentation supporting this
information shall be available to OIG, upon request.
8. a description of the Disclosure Program required by Section III.E;
9. the following information regarding the IRO(s): (a) identity, address, and
phone number; (b) a copy of the engagement letter; and (c) a summary and
description of any and all current and prior engagements and agreements between
Spectranetics and the IRO;
10. a certification from the IRO regarding its professional independence and
objectivity with respect to Spectranetics;
11. a description of the process by which Spectranetics fulfills the
requirements of Section III.F regarding Ineligible Persons;
12. the name, title, and responsibilities of any person who is determined to be
an Ineligible Person under Section III.F; the actions taken in response to the
screening and removal obligations set forth in Section III.F;
13. a list of all of Spectranetics’ locations (including locations and mailing
addresses) at which it performs Promotional and Product Services Related
Functions, Reporting Related Functions, and Clinical Investigation Related
Functions; the corresponding name under which each location is doing business;
the corresponding phone numbers and fax numbers; each location’s Federal health
care provider number and/or supplier number(s) (if applicable); and the name and
address of each Federal health care program contractor to which Spectranetics
currently submits claims (if applicable);
14. a description of Spectranetics’ corporate structure, including
identification of any parent and sister companies, subsidiaries, and their
respective lines of business; and
15. the certifications required by Section V.C.
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B. Annual Reports. Spectranetics shall submit to OIG annually a report with
respect to the status of, and findings regarding, Spectranetics’ compliance
activities for each of the five Reporting Periods (Annual Report).
Each Annual Report shall include, at a minimum:
1. any change in the identity, position description, or other noncompliance job
responsibilities of the Chief Compliance Officer and any change in the
membership of the Compliance Committee, or the membership of the Board of
Directors described in Section III.A;
2. a copy of the Board’s resolution described in Section III.A.3.b;
3. a summary of any significant changes or amendments to the Policies and
Procedures required by Section III.B and the reasons for such changes (e.g.,
change in applicable requirements);
4. the number of individuals required to complete the Code of Conduct
certification required by Section III.B.1, the percentage of individuals who
have completed such certification, and an explanation of any exceptions (the
documentation supporting this information shall be available to OIG, upon
request);
5. the following information regarding each type of training required by
Section III.C:
a. a description of such training, including a summary of the topics covered,
the length of sessions, and a schedule of training sessions; and
b. the number of individuals required to be trained, percentage of individuals
actually trained, and an explanation of any exceptions.
A copy of all training materials and the documentation supporting this
information shall be available to OIG, upon request.
6. a complete copy of all reports prepared pursuant to Section III.D, along with
a copy of the IRO’s engagement letter (if applicable);
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7. Spectranetics’ response and corrective action plan(s) related to any issues
raised by the reports prepared pursuant to Section III.D;
8. a summary and description of any and all current and prior engagements and
agreements between Spectranetics and the IRO, if different from what was
submitted as part of the Implementation Report;
9. a certification from the IRO regarding its professional independence and
objectivity with respect to Spectranetics;
10. a summary of Reportable Events (as defined in Section III.H) identified
during the Reporting Period and the status of any corrective and preventative
action relating to all such Reportable Events;
11. a summary of the disclosures in the disclosure log required by Section III.E
that relate to Federal health care programs;
12. any changes to the process by which Spectranetics fulfills the requirements
of Section III.F regarding Ineligible Persons;
13. the name, title, and responsibilities of any person who is determined to be
an Ineligible Person under Section III.F;
14. a summary describing any ongoing investigation or legal proceeding required
to have been reported pursuant to Section III.G. The summary shall include a
description of the allegation, the identity of the investigating or prosecuting
agency, and the status of such investigation or legal proceeding;
15. a summary describing any written communication with the FDA required to have
been reported pursuant to Section III.I. This summary shall include a
description of the matter and the status of the matter;
16. a description of all changes to the most recently provided list of
Spectranetics’ locations (including addresses) as required by Section V.A.14;
the corresponding name under which each location is doing business; the
corresponding phone numbers and fax numbers; each location’s Federal health care
program provider number(s) and/or supplier number(s); and the name and address
of each Federal health care program contractor to which Spectranetics currently
submits claims; and
17. the certifications required by Section V.C.
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The first Annual Report shall be received by OIG no later than 60 days after the
end of the first Reporting Period. Subsequent Annual Reports shall be received
by OIG no later than the anniversary date of the due date of the first Annual
Report.
C. Certifications. The Implementation Report and Annual Reports shall include a
certification by the Chief Compliance Officer that:
1. to the best of his or her knowledge, except as otherwise described in the
applicable report, Spectranetics is in compliance with Federal health care
program and FDA requirements and all of the requirements of this CIA;
2. he or she has reviewed the Report and has made reasonable inquiry regarding
its content and believes that the information in the Report is accurate and
truthful; and
3. to the best of his or her knowledge, Spectranetics has complied with its
obligations under the Settlement Agreement: (a) not to resubmit to any Federal
health care program payors any previously denied claims related to the Covered
Conduct addressed in the Settlement Agreement, and not to appeal any such
denials of claims; (b) not to charge to or otherwise seek payment from federal
or state payors for unallowable costs (as defined in the Settlement Agreement);
and (c) to identify and adjust any past charges or claims for unallowable costs;
and
4. Spectranetics’: 1) Policies and Procedures as referenced in Section III.B.2
above; 2) templates for standardized contracts and other similar documents
related to Promotional and Product Services Related Functions and Clinical
Investigation Related Functions; and 3) training materials used for purposes of
Section III.C all have been reviewed by competent legal counsel and/or legal
personnel working at Spectranetics and have been found to be in compliance with
all applicable Federal health care program and FDA requirements. In addition,
Spectranetics’ promotional material containing claims or information about
Spectranetics products and other materials and information to be distributed
outside of Spectranetics have been reviewed by competent regulatory, medical,
and/or legal personnel to ensure that legal, medical, and regulatory concerns
are properly addressed and are elevated when appropriate and to ensure that the
materials and information when finally approved are in compliance with all
applicable Federal health care program and FDA requirements. If the applicable
legal requirements have not changed, after the initial review of the documents
listed above, only material changes to the documents must be reviewed by
competent regulatory, medical, and/or legal personnel. The certification shall
include a description of the documents reviewed and approximately when the
review was completed. The documentation supporting this certification shall be
available to the OIG upon request.
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D. Designation of Information. Spectranetics shall clearly identify any portions
of its submissions that it believes are trade secrets, or information that is
commercial or financial and privileged or confidential, and therefore
potentially exempt from disclosure under the Freedom of Information Act (FOIA),
5 U.S.C. § 552. Spectranetics shall refrain from identifying any information as
exempt from disclosure if that information does not meet the criteria for
exemption from disclosure under FOIA.
VI. Notifications and Submission of Reports
Unless otherwise stated in writing after the Effective Date, all notifications
and reports required under this CIA shall be submitted to the following
entities:
OIG:
Administrative and Civil Remedies Branch
Office of Counsel to the Inspector General
Office of Inspector General
U.S. Department of Health and Human Services
Cohen Building, Room 5527
330 Independence Avenue, S.W.
Washington, DC 20201
Telephone: 202.619.2078
Facsimile: 202.205.0604
Spectranetics:
Michael K. Handley
Chief Compliance Officer
Vice President, Global Regulatory Affairs
Spectranetics Corporation
9965 Federal Drive
Colorado Springs, CO 80921
Email: michael.handley@spnc.com
Phone: 719.447.2318
Fax: 719.447.2070
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Unless otherwise specified, all notifications and reports required by this CIA
may be made by certified mail, overnight mail, hand delivery, or other means,
provided that there is proof that such notification was received. For purposes
of this requirement, internal facsimile confirmation sheets do not constitute
proof of receipt. Upon request by OIG, Spectranetics may be required to provide
OIG with an electronic copy of each notification or report required by this CIA
in searchable portable document format (pdf), either instead of or in addition
to, a paper copy.
VII. OIG Inspection, Audit, and Review Rights
In addition to any other rights OIG may have by statute, regulation, or
contract, OIG or its duly authorized representative(s) may examine or request
copies of Spectranetics’ books, records, and other documents and supporting
materials and/or conduct on-site reviews of any of Spectranetics’ locations for
the purpose of verifying and evaluating: (a) Spectranetics’ compliance with the
terms of this CIA; and (b) Spectranetics’ compliance with the requirements of
the Federal health care programs in which it participates and with all
applicable FDA requirements. The documentation described above shall be made
available by Spectranetics to OIG or its duly authorized representative(s) at
all reasonable times for inspection, audit, or reproduction. Furthermore, for
purposes of this provision, OIG or its duly authorized representative(s) may
interview any of Spectranetics’ employees, contractors, or agents who consent to
be interviewed at the individual’s place of business during normal business
hours or at such other place and time as may be mutually agreed upon between the
individual and OIG. Spectranetics shall assist OIG or its duly authorized
representative(s) in contacting and arranging interviews with such individuals
upon OIG’s request. Spectranetics’ employees may elect to be interviewed with or
without a representative of Spectranetics present.
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VIII. Document and Record Retention
Spectranetics shall maintain for inspection all documents and records relating
to reimbursement from the Federal health care programs, or to compliance with
this CIA, for six years (or longer if otherwise required by law) from the
Effective Date.
IX. Disclosures
Consistent with HHS’s FOIA procedures, set forth in 45 C.F.R. Part 5, OIG shall
make a reasonable effort to notify Spectranetics prior to any release by OIG of
information submitted by Spectranetics pursuant to its obligations under this
CIA and identified upon submission by Spectranetics as trade secrets, or
information that is commercial or financial and privileged or confidential,
under the FOIA rules. With respect to such releases, Spectranetics shall have
the rights set forth at 45 C.F.R. §
5.65(d).
X. Breach and Default Provisions
Spectranetics is expected to fully and timely comply with all of its CIA
obligations.
A. Stipulated Penalties for Failure to Comply with Certain Obligations. As a
contractual remedy, Spectranetics and OIG hereby agree that failure to comply
with certain obligations as set forth in this CIA may lead to the imposition of
the following monetary penalties (hereinafter referred to as “Stipulated
Penalties”) in accordance with the following provisions.
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1. A Stipulated Penalty of $2,500 (which shall begin to accrue on the day after
the date the obligation became due) for each day Spectranetics fails to
establish and implement any of the following obligations as described in
Section III:
a. a Chief Compliance Officer;
b. a Compliance Committee;
c. a resolution from the Board of Directors;
d. a written Code of Conduct;
e. written Policies and Procedures;
f. the training of Covered Persons and Relevant Covered Persons;
g. a Disclosure Program;
h. Ineligible Persons screening and removal requirements;
i. notification of Government investigations or legal proceedings;
j. notification of written communications with FDA as required by Section III.I;
and
k. reporting of Reportable Events.
2. A Stipulated Penalty of $2,500 (which shall begin to accrue on the day after
the date the obligation became due) for each day Spectranetics fails to engage
an IRO, as required in Section III.D and Appendix A.
3. A Stipulated Penalty of $2,500 (which shall begin to accrue on the day after
the date the obligation became due) for each day Spectranetics fails to submit
the Implementation Report or any Annual Reports to OIG in accordance with the
requirements of Section V by the deadlines for submission.
4. A Stipulated Penalty of $2,500 (which shall begin to accrue on the day after
the date the obligation became due) for each day Spectranetics fails to submit
the IRO Review Reports in accordance with the requirements of Section III.D and
Appendix B.
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5. A Stipulated Penalty of $2,000 (which shall begin to accrue on the date the
failure to comply began) for each day Spectranetics employs or contracts with an
Ineligible Person and that person: (i) has responsibility for, or involvement
with, Spectranetics’ business operations related to the Federal health care
programs; or (ii) is in a position for which the person=s salary or the items or
services rendered, ordered, or prescribed by the person are paid in whole or
part, directly or indirectly, by Federal health care programs or otherwise with
Federal funds (the Stipulated Penalty described in this paragraph shall not be
demanded for any time period during which Spectranetics can demonstrate that it
did not discover the person=s exclusion or other ineligibility after making a
reasonable inquiry (as described in section III.F) as to the status of the
person).
6. A Stipulated Penalty of $1,500 for each day Spectranetics fails to grant
access as required in Section VII. (This Stipulated Penalty shall begin to
accrue on the date Spectranetics fails to grant access.)
7. A Stipulated Penalty of $5,000 for each false certification submitted by or
on behalf of Spectranetics as part of its Implementation Report, Annual Report,
additional documentation to a report (as requested by the OIG), or otherwise
required by this CIA.
8. A Stipulated Penalty of $1,000 for each day Spectranetics fails to comply
fully and adequately with any obligation of this CIA. OIG shall provide notice
to Spectranetics stating the specific grounds for its determination that
Spectranetics has failed to comply fully and adequately with the CIA
obligation(s) at issue and steps Spectranetics shall take to comply with the
CIA. (This Stipulated Penalty shall begin to accrue 10 days after Spectranetics
receives this notice from OIG of the failure to comply.) A Stipulated Penalty as
described in this Subsection shall not be demanded for any violation for which
OIG has sought a Stipulated Penalty under Subsections 1-7 of this Section.
B. Timely Written Requests for Extensions. Spectranetics may, in advance of the
due date, submit a timely written request for an extension of time to perform
any act or file any notification or report required by this CIA. Notwithstanding
any other provision in this Section, if OIG grants the timely written request
with respect to an act, notification, or report, Stipulated Penalties for
failure to perform the act or file the notification or report shall not begin to
accrue until one day after Spectranetics fails to meet the revised deadline set
by OIG. Notwithstanding any other provision in this Section, if OIG denies such
a timely written request, Stipulated Penalties for failure to perform the act or
file the notification or report shall not begin to accrue until three business
days after Spectranetics receives OIG’s written denial of such request or the
original due date, whichever is later. A “timely written request” is defined as
a request in writing received by OIG at least five business days prior to the
date by which any act is due to be performed or any notification or report is
due to be filed.
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C. Payment of Stipulated Penalties.
1. Demand Letter. Upon a finding that Spectranetics has failed to comply with
any of the obligations described in Section X.A and after determining that
Stipulated Penalties are appropriate, OIG shall notify Spectranetics of:
(a) Spectranetics’ failure to comply; and (b) OIG’s exercise of its contractual
right to demand payment of the Stipulated Penalties (this notification is
referred to as the “Demand Letter”).
2. Response to Demand Letter. Within 10 days after the receipt of the Demand
Letter, Spectranetics shall either: (a) cure the breach to OIG’s satisfaction
and pay the applicable Stipulated Penalties or (b) request a hearing before an
HHS administrative law judge (ALJ) to dispute OIG’s determination of
noncompliance, pursuant to the agreed upon provisions set forth below in
Section X.E. In the event Spectranetics elects to request an ALJ hearing, the
Stipulated Penalties shall continue to accrue until Spectranetics cures, to
OIG’s satisfaction, the alleged breach in dispute. Failure to respond to the
Demand Letter in one of these two manners within the allowed time period shall
be considered a material breach of this CIA and shall be grounds for exclusion
under Section X.D.
3. Form of Payment. Payment of the Stipulated Penalties shall be made by
electronic funds transfer to an account specified by OIG in the Demand Letter.
4. Independence from Material Breach Determination. Except as set forth in
Section X.D.1.c, these provisions for payment of Stipulated Penalties shall not
affect or otherwise set a standard for OIG’s decision that Spectranetics has
materially breached this CIA, which decision shall be made at OIG’s discretion
and shall be governed by the provisions in Section X.D, below.
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D. Exclusion for Material Breach of this CIA.
1. Definition of Material Breach. A material breach of this CIA means:
a. a failure by Spectranetics to report a Reportable Event, and take corrective
action as required in Section III.H;
b. a repeated or flagrant violation of the obligations under this CIA,
including, but not limited to, the obligations addressed in Section X.A;
c. a failure to respond to a Demand Letter concerning the payment of Stipulated
Penalties in accordance with Section X.C;
d. a failure to engage and use an IRO in accordance with Section III.D; or
e. a failure of the Board to issue a resolution in accordance with Section
III.A.3.
2. Notice of Material Breach and Intent to Exclude. The parties agree that a
material breach of this CIA by Spectranetics constitutes an independent basis
for Spectranetics’ exclusion from participation in the Federal health care
programs. Upon a determination by OIG that Spectranetics has materially breached
this CIA and that exclusion is the appropriate remedy, OIG shall notify
Spectranetics of: (a) Spectranetics’ material breach; and (b) OIG’s intent to
exercise its contractual right to impose exclusion (this notification is
hereinafter referred to as the “Notice of Material Breach and Intent to
Exclude”).
3. Opportunity to Cure. Spectranetics shall have 30 days from the date of
receipt of the Notice of Material Breach and Intent to Exclude to demonstrate to
OIG’s satisfaction that:
a. Spectranetics is in compliance with the obligations of the CIA cited by OIG
as being the basis for the material breach;
b. the alleged material breach has been cured; or
c. the alleged material breach cannot be cured within the 30-day period, but
that: (i) Spectranetics has begun to take action to cure the material breach;
(ii) Spectranetics is pursuing such action with due diligence; and
(iii) Spectranetics has provided to OIG a reasonable timetable for curing the
material breach.
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4. Exclusion Letter. If, at the conclusion of the 30-day period, Spectranetics
fails to satisfy the requirements of Section X.D.3, OIG may exclude
Spectranetics from participation in the Federal health care programs. OIG shall
notify Spectranetics in writing of its determination to exclude Spectranetics
(this letter shall be referred to hereinafter as the “Exclusion Letter”).
Subject to the Dispute Resolution provisions in Section X.E, below, the
exclusion shall go into effect 30 days after the date of Spectranetics’ receipt
of the Exclusion Letter. The exclusion shall have national effect and shall also
apply to all other Federal procurement and nonprocurement programs.
Reinstatement to program participation is not automatic. After the end of the
period of exclusion, Spectranetics may apply for reinstatement by submitting a
written request for reinstatement in accordance with the provisions at 42 C.F.R.
§§ 1001.3001-.3004.
E. Dispute Resolution
1. Review Rights. Upon OIG’s delivery to Spectranetics of its Demand Letter or
of its Exclusion Letter, and as an agreed-upon contractual remedy for the
resolution of disputes arising under this CIA, Spectranetics shall be afforded
certain review rights comparable to the ones that are provided in 42 U.S.C. §
1320a-7(f) and 42 C.F.R. Part 1005 as if they applied to the Stipulated
Penalties or exclusion sought pursuant to this CIA. Specifically, OIG’s
determination to demand payment of Stipulated Penalties or to seek exclusion
shall be subject to review by an HHS ALJ and, in the event of an appeal, the HHS
Departmental Appeals Board (DAB), in a manner consistent with the provisions in
42 C.F.R. § 1005.2-1005.21. Notwithstanding the language in 42 C.F.R. §
1005.2(c), the request for a hearing involving Stipulated Penalties shall be
made within 10 days after receipt of the Demand Letter and the request for a
hearing involving exclusion shall be made within 25 days after receipt of the
Exclusion Letter.
2. Stipulated Penalties Review. Notwithstanding any provision of Title 42 of the
United States Code or Title 42 of the Code of Federal Regulations, the only
issues in a proceeding for Stipulated Penalties under this CIA shall be:
(a) whether Spectranetics was in full and timely compliance with the obligations
of this CIA for which OIG demands payment; and (b) the period of noncompliance.
Spectranetics shall have the burden of proving its full and timely compliance
and the steps taken to cure the noncompliance, if any. OIG shall not have the
right to appeal to the DAB an adverse ALJ decision related to Stipulated
Penalties. If the ALJ agrees with OIG with regard to a finding of a breach of
this CIA and orders Spectranetics to pay Stipulated Penalties, such Stipulated
Penalties shall become due and payable 20 days after the ALJ issues such a
decision unless Spectranetics requests review of the ALJ decision by the DAB. If
the ALJ decision is properly appealed to the DAB and the DAB upholds the
determination of OIG, the Stipulated Penalties shall become due and payable
20 days after the DAB issues its decision.
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3. Exclusion Review. Notwithstanding any provision of Title 42 of the United
States Code or Title 42 of the Code of Federal Regulations, the only issues in a
proceeding for exclusion based on a material breach of this CIA shall be:
a. whether Spectranetics was in material breach of this CIA;
b. whether such breach was continuing on the date of the Exclusion Letter; and
c. whether the alleged material breach could not have been cured within the
30-day period, but that: (i) Spectranetics had begun to take action to cure the
material breach within that period; (ii) Spectranetics has pursued and is
pursuing such action with due diligence; and (iii) Spectranetics provided to OIG
within that period a reasonable timetable for curing the material breach and
Spectranetics has followed the timetable.
For purposes of the exclusion herein, exclusion shall take effect only after an
ALJ decision favorable to OIG, or, if the ALJ rules for Spectranetics, only
after a DAB decision in favor of OIG. Spectranetics’ election of its contractual
right to appeal to the DAB shall not abrogate OIG’s authority to exclude
Spectranetics upon the issuance of an ALJ’s decision in favor of OIG. If the ALJ
sustains the determination of OIG and determines that exclusion is authorized,
such exclusion shall take effect 20 days after the ALJ issues such a decision,
notwithstanding that Spectranetics may request review of the ALJ decision by the
DAB. If the DAB finds in favor of OIG after an ALJ decision adverse to OIG, the
exclusion shall take effect 20 days after the DAB decision. Spectranetics shall
waive its right to any notice of such an exclusion if a decision upholding the
exclusion is rendered by the ALJ or DAB. If the DAB finds in favor of
Spectranetics, Spectranetics shall be reinstated effective on the date of the
original exclusion.
4. Finality of Decision. The review by an ALJ or DAB provided for above shall
not be considered to be an appeal right arising under any statutes or
regulations. Consequently, the parties to this CIA agree that the DAB’s decision
(or the ALJ’s decision if not appealed) shall be considered final for all
purposes under this CIA.
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XI. Effective and Binding Agreement
Spectranetics and OIG agree as follows:
A. This CIA shall be binding on the successors, assigns, and transferees of
Spectranetics;
B. This CIA shall become final and binding on the date the final signature is
obtained on the CIA;
C. This CIA constitutes the complete agreement between the parties and may not
be amended except by written consent of the parties to this CIA;
D. OIG may agree to a suspension of Spectranetics’ obligations under the CIA in
the event of Spectranetics’ cessation of participation in Federal health care
programs. If Spectranetics ceases participating in Federal health care programs
and is relieved of its CIA obligations by OIG, Spectranetics shall notify OIG at
least 30 days in advance of Spectranetics’ intent to resume participating as a
provider or supplier with any Federal health care program. Upon receipt of such
notification, OIG shall evaluate whether the CIA should be reactivated or
modified.
E. The undersigned Spectranetics signatories represent and warrant that they are
authorized to execute this CIA. The undersigned OIG signatory represents that he
is signing this CIA in his official capacity and that he is authorized to
execute this CIA.
F. This CIA may be executed in counterparts, each of which constitutes an
original and all of which constitute one and the same CIA. Facsimiles of
signatures shall constitute acceptable, binding signatures for purposes of this
CIA.
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On Behalf of the Spectranetics Corporation

             
 
  By:   /s/ Emile Geisenheimer   Dated: 12/18/2009
 
     
 
EMILE GEISENHEIMER    
 
      Chief Executive Officer    
 
      Spectranetics Corporation    
 
           
 
  By:   /s/ Roger Wertheimer   Dated: 12/18/2009
 
     
 
ROGER WERTHEIMER    
 
      Spectranetics Corporation    
 
      Vice President, General Counsel & Secretary    
 
      Vice President, Human Resources    
 
           
 
  By:   /s/ Michael C. Theis   Dated: 12/18/2009
 
     
 
PETER S. SPIVACK    
 
      MICHAEL C. THEIS    
 
      Hogan & Hartson LLP    
 
      Counsel for the Spectranetics Corporation    

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On behalf of the Office of Inspector General
of the Department of Health and Human Services

         
/s/ Gregory E. Demske
  12/22/09    
 
GREGORY E. DEMSKE
 
 
DATE    
Assistant Inspector General for Legal Affairs
       
Office of Inspector General
       
U. S. Department of Health and Human Services
       

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APPENDIX A
INDEPENDENT REVIEW ORGANIZATION
This Appendix contains the requirements relating to the Independent Review
Organization (IRO) required by Section III.D of the CIA.
A. IRO Engagement
Spectranetics shall engage an IRO that possesses the qualifications set forth in
Paragraph B, below, to perform the responsibilities in Paragraph C, below. The
IRO shall conduct the review in a professionally independent and objective
fashion, as set forth in Paragraph D. Within 30 days after OIG receives written
notice of the identity of the selected IRO, OIG will notify Spectranetics if the
IRO is unacceptable. Absent notification from OIG that the IRO is unacceptable,
Spectranetics may continue to engage the IRO.
If Spectranetics engages a new IRO during the term of the CIA, this IRO shall
also meet the requirements of this Appendix. If a new IRO is engaged,
Spectranetics shall submit the information identified in Section V.A.9 of the
CIA to OIG within 30 days of engagement of the IRO. Within 30 days after OIG
receives written notice of the identity of the selected IRO, OIG will notify
Spectranetics if the IRO is unacceptable. Absent notification from OIG that the
IRO is unacceptable, Spectranetics may continue to engage the IRO.
B. IRO Qualifications.
The IRO shall:
1. assign individuals to conduct the IRO Reviews who have expertise in all
applicable Federal health care program and FDA requirements relating to
Promotional and Product Services Related Functions, Clinical Investigation
Related Functions, and Reporting Related Functions. The assigned individuals
shall also be knowledgeable about the general requirements of the Federal health
care program(s) under which Spectranetics products are reimbursed;
2. assign individuals to design and select the samples for the Transaction
Reviews who are knowledgeable about the appropriate statistical sampling
techniques; and
3. have sufficient staff and resources to conduct the reviews required by the
CIA on a timely basis.
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C. IRO Responsibilities.
The IRO shall:
1. perform each component of the IRO Review in accordance with the specific
requirements of the CIA;
2. follow all applicable Federal health care program and FDA requirements in
making assessments in each IRO Review;
3. if in doubt of the application of a particular Federal health care program or
FDA requirement, policy, or regulation, request clarification from the
appropriate authority (e.g., CMS or FDA);
4. respond to all OIG inquires in a prompt, objective, and factual manner; and
5. prepare timely, clear, well-written reports that include all the information
required by Appendix B to the CIA.
D. IRO Independence and Objectivity.
The IRO must perform the IRO Reviews in a professionally independent and
objective fashion, as appropriate to the nature of the engagement, taking into
account any other business relationships or engagements that may exist between
the IRO and Spectranetics.
E. IRO Removal/Termination.
1. Spectranetics Termination of IRO. If Spectranetics terminates its IRO during
the course of the engagement, Spectranetics must submit a notice explaining its
reasons to OIG no later than 30 days after termination. Spectranetics must
engage a new IRO in accordance with Paragraph A of this Appendix.
2. OIG Removal of IRO. In the event OIG has reason to believe that the IRO does
not possess the qualifications described in Paragraph B, is not independent
and/or objective as set forth in Paragraph D, or has failed to carry out its
responsibilities as described in Paragraph C, OIG may, at its sole discretion,
require Spectranetics to engage a new IRO in accordance with Paragraph A of this
Appendix.
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Prior to requiring Spectranetics to engage a new IRO, OIG shall notify
Spectranetics of its intent to do so and provide a written explanation of why
OIG believes such a step is necessary. To resolve any concerns raised by OIG,
Spectranetics may request a meeting with OIG to discuss any aspect of the IRO’s
qualifications, independence or performance of its responsibilities and to
present additional information regarding these matters. Spectranetics shall
provide any additional information as may be requested by OIG under this
Paragraph in an expedited manner. OIG will attempt in good faith to resolve any
differences regarding the IRO with Spectranetics prior to requiring
Spectranetics to terminate the IRO. However, the final determination as to
whether or not to require Spectranetics to engage a new IRO shall be made at the
sole discretion of OIG.
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Appendix B to CIA
I. General Description
As specified more fully below, Spectranetics shall retain an Independent Review
Organization (IRO) to perform reviews to assist Spectranetics in assessing and
evaluating its systems, processes, policies, procedures, and practices related
to Spectranetics’s Clinical Investigation Related Functions, Reporting Related
Functions, and Promotional and Product Services Related Functions (IRO Review).
The IRO Review shall consist of two components — a systems review (Systems
Review), and a transactions review (Transactions Review) as described more fully
below. Spectranetics may engage, at its discretion, a single IRO to perform both
components of the IRO Review provided that the entity has the necessary
expertise and capabilities to perform both.
If there are no material changes in Spectranetics’s systems, processes,
policies, and procedures relating to Clinical Investigations, Reporting, and
Promotional and Product Services Related Functions, the IRO shall perform the
Systems Review for the first and fourth Reporting Periods. If Spectranetics
materially changes its systems, processes, policies, and procedures relating to
Clinical Investigation Related Functions, Reporting Related Functions, and
Promotional and/or Product Services Related Functions, the IRO shall perform a
Systems Review for the materially changed Related Function for the Reporting
Period(s) in which such changes were made in addition to conducting the Review
for the first and fourth Reporting Periods. The additional Systems Review(s)
shall consist of: 1) an identification of the material changes; 2) an assessment
of whether other systems, processes, policies, and procedures previously
reported did not materially change; and 3) a review of the systems, processes,
policies, and procedures that materially changed. The IRO shall conduct the
Transactions Review for each Reporting Period of the CIA.
II. Systems Review
A. Description of Reviewed Policies and Procedures
The Systems Review shall be a review of Spectranetics’s systems, processes,
policies, and procedures (including the controls on those systems, processes,
policies, and procedures) relating to certain Clinical Investigation Related
Functions, Reporting Related Functions, and Promotional and Product Services
Related Functions. Where practical, Spectranetics personnel may compile
documentation, schedule and organize interviews, and undertake other efforts to
assist the IRO in performing the Systems Review. The IRO is not required to
undertake a de novo review of the information gathered or activities undertaken
by Spectranetics pursuant to the preceding sentence.
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Specifically, the IRO shall review certain of Spectranetics’s systems,
processes, policies, and procedures associated with the following (hereafter
“Reviewed Policies and Procedures”).

  1.   The IRO shall review Spectranetics’s systems, policies, processes, and
procedures applicable to Promotional and Product Services Related Functions:

  a.   Spectranetics’s systems, policies, processes, and procedures applicable
to the manner in which Spectranetics sales representatives and account
executives handle and submit requests or inquiries about the off-label uses of
Spectanetics’s products to Spectranetics’s Medical Services Department;     b.  
the manner in which Spectranetics’s Medical Services Department handles and
responds to requests and inquiries regarding off-label uses of Spectranetics’s
products (including tracking the requests and using pre-approved materials for
purposes of responding to the request);     c.   the form and content of
information and materials Spectranetics provides to physicians, pharmacists, or
other health care professionals (collectively “HCPs”) or health care
institutions (HCIs) regarding off-label uses of Spectranetics’s products;     d.
  Spectranetics’s systems, policies, processes, and procedures, including those
associated with Spectranetics’s Promotional and Advertising Committee (PARC),
relating to Spectranetics’s internal review of information and materials
regarding Spectranetics’s products that Spectranetics disseminates to HCPs or
HCIs;     e.   Spectranetics’s systems, processes, policies, and procedures
relating to the development and review of call plans for Spectranetics’s
products. This shall include a review of the bases upon which HCPs and HCIs
belonging to specified medical specialties or types of practice are included in,
or excluded from, the call plans based on expected utilization of Spectranetics
products for FDA-approved uses or non-FDA-approved uses;     f.   the processes
and procedures by which Spectranetics’s Compliance Office and Spectranetics
Medical Services Department monitor and identify situations in which it appears
that improper off-label promotion may have occurred; and

  g.   Spectranetics’s systems, processes, policies, and procedures for
investigating, documenting, resolving, and taking appropriate disciplinary
action for potential situations involving off-label promotion.

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  2.   The IRO shall review Spectranetics’s systems, policies, processes, and
procedures applicable to Clinical Investigation Related Functions:

  a.   Spectranetics’s systems, policies, processes, and procedures for ensuring
that Spectrenetics does not introduce or cause to be introduced into interstate
commerce devices prior to complying with one of the methods of FDA
authorization: (1) an FDA-approved pre-market approval application, under 21
U.S.C. § 360e(a)(2) and 21 C.F.R. Part 814; (2) a “510(k) clearance” by FDA for
marketing because it is found to be substantially equivalent to an appropriate,
legally marketed device, under 21 U.S.C. §§ 360c(a)(1) and 360(k) and 21 C.F.R.
Part 807 — Subpart E; (3) an investigational device exemption under 21 U.S.C. §
360j(g), for the use of a device on humans on an experimental basis; or (4) an
exemption for certain devices as set forth in 21 U.S.C. § 360(l);     b.  
Spectranetics’s systems, processes, policies, and procedures to identify or
evaluate when the use of a Spectranetics device, including use of a
Spectranetics device in connection with a patient registry, is a clinical
investigation;     c.   Spectranetics’s systems, processes, policies, and
procedures to provide for the protection of human subjects, including obtaining
informed consent, as provided in 21 C.F.R. Part 50 and 56 and in 45 C.F.R.
Part 45;     d.   Spectranetics’s systems, processes, policies, and procedures
for clinical investigations site audits;     e.   Spectranetics’s processes,
policies, and procedures regarding disclosure of financial interests of clinical
investigators, as required by 21 C.F.R. Part 54, for studies using
Spectranetics’s products;     f.   Spectranetics’s systems, processes, policies,
and procedures for complying with reporting obligations provided in 21 C.F.R. §
812.150 for devices with an approved investigational device exception.     g.  
the processes and procedures by which Spectranetics’s Compliance Office
identifies situations in which it appears that non-compliance occurred with
regard to the requirements for, or Spectranetics’s policies and procedures
relating to Clinical Investigations Related Functions; and

  h.   Spectranetics’s processes, policies, and procedures for investigating,
documenting, resolving, and taking appropriate disciplinary action for
situations potentially involving non-compliant Clinical Investigations Related
Functions.

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  3.   The IRO shall review Spectranetics’s systems, policies, processes, and
procedures applicable to Reporting Related Functions:

  a.   Spectranetics’s processes, policies, and procedures for reporting adverse
events, including processes to ensure compliance with MDR regulations at 21
C.F.R. Part 803;     b.   Spectranetics’s processes, policies, and procedures
relating to reporting obligations as provided in 21 C.F.R. § 814.84, including
submission of summaries and bibliographies of information not submitted as part
of a pre-market application, for devices with FDA premarket approval under 21
U.S.C. §  360(e)(2),     c.   the processes and procedures by which
Spectranetics’s Compliance Office monitors and identifies situations in which it
appears that Spectranetics has failed to comply with FDA Reporting Related
requirements and/or Spectranetics’s own Reporting Related policies and
procedures; and     d.   Spectranetics’s processes, policies, and procedures for
investigating, documenting, resolving, and taking appropriate disciplinary
action for failure to comply with Reporting Related requirements and/or
Spectranetics’s own Reporting Related policies and procedures.

B. Systems Review Report.
The IRO shall prepare a report based upon each Systems Review. For each of the
Reviewed Policies and Procedures identified in Section II.A above, the report
shall include the following items:

  1.   a description of the documentation (including policies) reviewed and any
personnel interviewed;

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  2.   a detailed description of Spectranetics’s systems, policies, processes,
and procedures relating to the items identified in Sections II.A.1-3 above,
including a general description of Spectranetics’s control and accountability
systems (e.g., documentation and approval requirements, and tracking mechanisms)
and written policies regarding the Reviewed Policies and Procedures;     3.   a
description of the manner in which the control and accountability systems and
the written policies relating to the items identified in Sections II.A.1-3 above
are made known or disseminated within Spectranetics;     4.   a detailed
description of any system(s) used to track and respond to requests and inquiries
regarding off-label uses of Spectranetics products;     5.   findings and
supporting rationale regarding any weaknesses in Spectranetics’s systems,
processes, policies, and procedures relating to the Reviewed Policies and
Procedures, if any; and     6.   recommendations to improve any of the systems,
policies, processes, or procedures relating to the Reviewed Policies and
Procedures, if any.

III. Transactions Review
As described more fully below in Sections III.A-E, the Transactions Review shall
be based upon a review of a sample of documents, including patient records and
other documents relating to patients participating in clinical investigations or
clinical registries involving Spectranetics products. The IRO shall report on
all aspects of the Transactions Review in the Transactions Review Reports.
A. Definitions.

  1.   Sampling Unit: A patient participating in a Clinical Investigation or
clinical registry using a Spectranetics product conducted inside the United
States.     2.   Population: All patients participating in a Clinical
Investigation or clinical registry using a Spectranetics product conducted
inside the United States during the reporting period.     3.   Error: Sampled
patients whose medical record and associated documents is missing documentation
described in the methodology in Section III.C, below, or for whom there in an
adverse finding for Inquiries III.C.3-7 below.

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  B.   Sample: The IRO shall randomly select 40 patients from all patients
participating in a Clinical Investigation or clinical registry using a
Spectranetics product conducted inside the United States during the reporting
period. The IRO shall conduct the review based on supporting documentation in
Spectranetics’ possession and copies of supporting documentation and patient
records obtained from Spectranetics Clinical Investigation and clinical registry
sites.     C.   Methodology: For each Sampling Unit, the IRO shall review the
documentation and evaluate or identify the following (“Inquiries”):

  1.   Identify the legal authority under which the Spectranetics may
distribute, or cause the distribution of, the device used in the Clinical
Investigation or Registry;     2.   After evaluating the purpose of the study,
whether the study was a Clinical Investigation;     3.   Whether the patient was
clinically eligible for inclusion in the Clinical Investigation or Registry;    
4.   If applicable, whether Institutional Review Board approval was obtained for
the study;     5.   Whether patient’s informed consent was obtained;     6.   If
an adverse event occurred, whether it was appropriately reported within
Spectranetics; and     7.   If an adverse event occurred, whether it was
appropriately reported to the FDA under the appropriate reporting requirements
at 21 C.F.R. Part 803 or 21 C.F.R. § 812.150.

  D.   Other Requirements.

  1.   Replacement Sampling. Replacement sampling is not permitted for Sampling
Units with missing documentation.     2.   Use of First Samples Drawn. Sampling
Units selected in each first sample shall be used (i.e., it is not permissible
to generate more than one list of random samples and then select one for use).

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  E.   Transaction Review Report. For each Reporting Period, the IRO shall
prepare a report based on its Transactions Review. The report shall include the
following:

  1.   General Elements to Be Included in Report

  a.   Review Objectives: A clear statement of the objective intended to be
achieved by the review;     b.   Population: A description of the Population;  
  c.   Review Protocol: A detailed narrative description of the procedures
performed and a description of the Sampling Unit and universe utilized in
performing the procedures for each Sample Unit reviewed; and     d.   Sources of
Data: A full description of documentation and other information, if applicable,
relied upon by the IRO in performing the Transactions Review.

  2.   Statistical Sampling Documentation.

  a.   The number of Sampling Units in the sample;     b.   The number of
Sampling Units for which an Error was identified and an explanation of the
Error;     c.   A copy of the printout of the random numbers generated by the
“Random Numbers” function of the statistical sampling software used by the IRO,
including the seed number; and     d.   A description or identification of the
statistical sampling software package used to select the sample.

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  3.   Results to be Included in Report. The following results shall be included
in each Promotional and Product Services Review Report:

  a.   A narrative explanation of the IRO’s findings and supporting rationale
(including reasons for Errors and patterns noted, etc.) based on the Inquiries
conducted as part of the Transactions Review.

  b.   A narrative explanation of the IRO’s findings and supporting rationale
regarding any weaknesses in Spectranetics’s systems, processes, policies,
procedures, and practices relating to the Inquiries, if any;     c.  
recommendations for improvement in Spectranetics’s systems, processes, policies,
procedures, and practices relating to the Inquiries; and     d.   a spreadsheet
identifying by Sampling Unit the results of each Inquiry.

  4.   Credentials. The names and credentials of the individuals who: (a)
designed the statistical sampling procedure for the Transactions Review and (b)
performed the Transactions Review.

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