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News | March 13, 2023

Two Biotech Firms & Co-Founder to Pay over $10 Million for Mischarging Federal Grants

By DCAA Staff Writer

DCAA auditor Maria Rosalinda Perez-Rivera and Supervisory Auditor Fei Lincoln provided assistance in a case involving two biotech firms and allegations of improper billing to federal grants.

Dr. Paul Andrew Rhodes and the biotechnology companies he co-founded iSense, LLC and Specific Diagnostics, Inc. entered into a settlement agreement to resolve allegations that the firms mischarged federal grants. The scheme consisted of billing for costs incurred by another business not covered by grants and for compensation in amounts exceeding authorized federal limits. The settlement also resolves allegations of backdating services and cost-sharing agreements and knowingly presenting a backdated agreement to the United States. Under the terms of the settlement amount of $10,068,875, the companies will each pay $4 million and Dr. Rhodes will pay $2,068,875.

DCAA’s auditors supported law enforcement partners by reviewing and analyzing costs claimed in the incurred cost proposals and other accounting records to assist all aspects of the investigation.

Read the Department of Justice press release.