New England Health Care Fraud Strike Force Secures Its First Corporate Resolution in Massachusetts Since Its Expansion

On March 5, the Department of Justice announced that it secured a Deferred Prosecution Agreement (“DPA”) with ExThera Medical Corporation after a former executive admitted to concealing the death of patients who were treated with ExThera’s products. This is the first corporate resolution since the New England Health Care Fraud Strike Force’s recent expansion into Massachusetts.

Fraudulent Scheme

ExThera manufactured a blood filtration device that was used to treat cancer patients. The device removed pathogens from a patient’s bloodstream. These devices were provided to cancer patients at clinics in Antigua. DOJ alleged that Sanja Ilic, ExThera Medical Corporation’s Chief Regulatory Officer, learned in March and April 2024 of the declining health and deaths of two patients treated with the device in Antigua within days of each other. Rather than report these adverse events to the Food and Drug Administration (“FDA”) as required, Illic concealed all information regarding the adverse events to avoid FDA scrutiny that could jeopardize clinical partnerships and ExThera’s and her own financial prospects. At the time, ExThera had secured $10 million in funding, with the potential for additional distribution revenues, and had also commenced its first U.S. clinical study involving cancer treatment. After public reporting and Ilic’s termination, ExThera filed several adverse event reports with the FDA related to cancer treatment outside the United States.

As part of the resolution, Ilic agreed to plead guilty to failing to file adverse event reports with the intent to defraud and mislead the FDA in connection with the blood filtration devices used on cancer patients in Antigua. Ilic faces up to three years’ imprisonment, one year of supervised release, a fine of the greatest of $250,000 or twice the gross gain or loss under 18 U.S.C. § 3571, forfeiture, and restitution.

Deferred Prosecution Agreement

As a result of the fraudulent scheme, ExThera entered into a three-year DPA in the District of Massachusetts. The DPA resolves a criminal information charging the company with failure to file adverse event reports with the intent to defraud or mislead the FDA. Under the DPA, ExThera admitted that, through Ilic, the company acted with intent to defraud and mislead the FDA. As part of its obligation under the DPA, ExThera agreed to do the following:

1. Ongoing cooperation and disclosures to the DOJ
2. To implement a compliance and ethics program addressing the Food, Drug, and Cosmetic Act’s adverse event reporting requirements
3. To report to DOJ on remediation and compliance implementation
4. To pay a $750,000 criminal penalty adjusted for ability to pay
5. To establish an escrow account and deposit $750,000 within 60 days for potential civil liabilities related to the conduct, and
6. To consent to a $5,694,750 forfeiture order

In reaching its resolution with ExThera, DOJ considered the nature and seriousness of the conduct, ExThera’s minimal remaining operations, the lack of voluntary self-disclosure, and credited the company for accepting responsibility, fully cooperating, and taking timely remedial measures.

Enforcement Context: New England Strike Force Expansion and First Corporate Resolution

The announcement marks the first corporate resolution by the Health Care Fraud Unit’s New England Strike Force since its recent expansion to Massachusetts. As previously reported in September 2025, the DOJ’s Health Care Fraud Strike Force Program is now operating eight strike forces in federal districts nationwide, including Massachusetts. Since March 2007, the Strike Force Program has charged more than 6,200 defendants who collectively billed federal health care programs and private insurers over $45 billion. ExThera’s DPA aligns with the DOJ’s broader nationwide strategy to intensify health care fraud enforcement.

Verrill’s Boston Office has a seasoned team of lawyers with extensive experience defending and advising participants in the healthcare industry in investigations and enforcement proceedings. For more information about this and other enforcement trends, please contact Annabel Rodriguez at (617) 357-3747 and arodriguez@verrill-law.com, Jay McCormack at (617) 357-3776  and  jmccormack@verrill-law.com, or Michael K. Fee at (617) 292-2866 and mfee@verrill-law.com.