Zimmer Biomet says federal probe to extend past deadline

Zimmer Biomet (NYSE:ZBH) said last week that the U.S. Justice Dept.’s probe into alleged Biomet kickbacks schemes in Brazil and Mexico will extend past the deadline of a deferred prosecution agreement reached in 2012.

The DoJ alleged that Biomet and its subsidiaries paid out more than $1.5 million in illegal kickbacks to employees of state-owned health services in Brazil and China. Biomet paid $22 million in March 2012 to settle the case with the Justice Dept. and the U.S. Securities & Exchange Commission.

In July 2014, an SEC subpoena prompted Biomet to reveal other alleged improprieties at its operations in Brazil and Mexico. A year ago, Warsaw, Ind.-based Biomet said the DPA would be prolonged until March 26. Zimmer and Biomet merged in June 2015.

Zimmer Biomet said March 25 that its discussions with the Justice Dept. and the SEC are slated to continue into the 2nd quarter.

“The DOJ has informed Biomet that it retains its rights under the DPA to bring further action against Biomet relating to the conduct in Brazil and Mexico disclosed in 2014 or the violations set forth in the DPA. The DOJ could, among other things, revoke the DPA or prosecute Biomet and/or the involved employees and executives,” the company said in a regulatory filing.

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