Venture Capital and the FDA: Is Fraud Baked In?

In 2011, Melayna Lokosky blew the whistle on what she perceived as fraud on the behalf of her employer, Acclarent, Inc., a medical device company owned by Johnson & Johnson. In July of 2016, the company’s former CEO and the former Vice President of Sales received a split decision in Federal Court in Massachusetts – acquittal on 14 felony counts but conviction on 10 misdemeanor counts of introducing adulterated and misbranded medical devices into interstate commerce. The following month, the Department of Justice reached an $18M settlement with Johnson & Johnson to settle outstanding civil claims.

Concurrent with her whistleblower work with the DOJ, Lokosky developed “The Sociopathic Business Model” to help the DOJ understand venture capital startup fraud and is the owner of MMpiHer (pronounced “Empire”) Strategic Consulting. Melayna joins Carol Roth to talk about how and why she became a whistleblower and how she helped get a dangerous $40 million/year medical device off the market. She shares her opinions on fraud being rampant in unicorn VC funding and other challenges faced in regulation for consumer safety.

She also shares how being a whistleblower is a career killer and why she did it anyway.

Plus, a “Now You Know” segment on FBI undercover code names.

You can connect with Melayna on Twitter @MelaynaLokosky or her website, Killing My Career.

The opinions expressed by Melayna Lokosky on this podcast are hers alone and do not reflect the opinions of Carol Roth, The Roth Effect and/or Ricochet.

Subscribe to The Roth Effect with Carol Roth in Apple Podcasts (and leave a 5-star review, please!), or by RSS feed. For all our podcasts in one place, subscribe to the Ricochet Audio Network Superfeed in Apple Podcasts or by RSS feed.

Please Support Our Sponsors!

Bambee

Now become a Ricochet member for only $5.00 a month! Join and see what you’ve been missing.

There are 3 comments.

Become a member to join the conversation. Or sign in if you're already a member.
  1. Ontheleftcoast Member

    Is fraud baked in?

    Yes. Next question?

    • #1
    • July 21, 2020, at 3:55 PM PDT
    • 2 likes
  2. mildlyo Member
    mildlyoJoined in the first year of Ricochet Ricochet Charter Member

    Great interview. That is one tough chica!

    • #2
    • July 24, 2020, at 12:00 AM PDT
    • Like
  3. Aaron Miller Member
    Aaron MillerJoined in the first year of Ricochet Ricochet Charter Member

    Communication and transportation technologies have shrunk the world since federal consumer protection agencies like the FDA were instituted. Why do we still need them? Why can’t we rely instead, wholly or largely, on private organizations like Blue Book, Consumer Reports, and various private review systems? 

    Consumers should be free to determine an acceptable level of risk or tradeoff for themselves. Government agencies are at least equally vulnerable to error, corruption, and overload as private feedback.

    • #3
    • July 24, 2020, at 12:57 PM PDT
    • Like