Local News in Brief : Pacemaker Firm in Sylmar Linked to Kickbacks to Doctor

A Sylmar pacemaker manufacturer, whose top executives were convicted last year of making illegal kickbacks to doctors, figures prominently in a recent grand jury indictment of a Rhode Island cardiologist, a spokeswoman for the U.S. Justice Department said Friday.

Pacesetter Systems Inc. of Sylmar, one of the nation’s largest pacemaker manufacturers, is one of two companies mentioned in a 14-count fraud, extortion and conspiracy indictment issued Thursday against Dr. Felix Balasco, according to Ellen Meltzer, a Justice Department lawyer.

Balasco, who will be arraigned next week, is accused of accepting $104,400 in kickbacks and loans from the Sylmar firm in violation of federal fraud, extortion and conspiracy laws, Meltzer said.

Meltzer said the case is an offshoot of a 1983 indictment of Pacesetter on charges of paying kickbacks to get doctors to use the company’s products. The company’s former president and vice president pleaded guilty and, in February, 1984, were fined a total of $42,500 and placed on probation.

In the indictment handed down Thursday, Balasco is accused of accepting laundered loans from Pacesetter and a Colorado firm in return for promises to implant the firms’ products in his patients, Meltzer said. Balasco is also accused of extorting cash payments from Pacemaker by threatening to stop using its products, she said.

Meltzer said no further charges will be filed against Pacesetter in connection with the alleged scheme. The 1983 indictment linked the company to $140,000 in illegal payments between 1979 and 1981.

The payments to Balasco were made in 1980, the latest indictment alleges.