Medtech exec charged in $69M fraud scheme, allegedly misrepresented COVID-19 blood test: 5 details

Mark Schena, president of medical technology company Arrayit Corp., has been charged in a fraud scheme in which the company allegedly submitted false and fraudulent claims for COVID-19 and allergy testing.

Five things to know:

1. The federal complaint against Mr. Schena in the Northern District of California alleges that he misled investors to manipulate stock prices and conspired to commit healthcare fraud by submitting more than $69 million in false claims for COVID-19 and allergy testing, according to a June 9 press release.

2. Mr. Schena touted Arrayit as a lab that offered microarray technology to test for COVID-19 and allergies based on a drop of blood that is 250,000 times smaller than the technology Theranos created years ago. He then allegedly misrepresented the test sales, financial condition and future prospects to potential investors. Mr. Schena also sent press releases and tweets about non-existent partnerships with several organizations, including Fortune 500 companies and government agencies.

3. In or around 2018, the company began to extend bribes to recruiters and doctors to use the allergy screening test for 120 allergens on all patients regardless of medical necessity.

4. During the COVID-19 pandemic, Mr. Schena allegedly made false claims about the company's ability to provide accurate, fast and cheap COVID-19 test results that also complied with federal regulations. He then misrepresented the information to potential investors about COVID-19 tests and the company's prospects for future tests.

5. While the company's stock prices doubled in mid-March, Mr. Schena failed to disclose that there were questions about the validity of the data.