Healthcare Matters

Not too long ago, and without admitting to any wrongdoing, Medtronic agreed to a settlement based on allegations that the company made false and misleading statements about its Infuse Bone Graft product.

Here’s a portion of the complaint:

• Specifically, the Defendants (Medtronic) misled shareholders regarding a near decade-long campaign to illegally promote its Infuse bone graft product for uses not approved by the Food and Drug Administration, or so-called “off-label uses,” and concealed from shareholders the fact that the reported sales and future growth of this business line and its associated revenues was driven by misconduct that invited, and ultimately brought about, the scrutiny of federal regulators and an abrupt decline in sales.

As we reported, in addition to the problems with off-label uses, even the integrity of the approval process for Infuse was called into question. It was alleged that scientists tasked with basic research responsibilities were either paid by Medtronic as consultants, bribed to keep quiet and/or encouraged to “massage” pertinent information about negative and identified potential side-effects.

Well, as it turns out a U.S. Senate Committee has completed its investigation and determined that Medtronic failed to disclose that it not only paid physicians to perform the Infuse studies, but that the company edited the  articles containing those studies that were ultimately published in various trade publications.  “The company’s significant role in authoring or substantively editing these articles was not disclosed in the published articles. Medical journals should ensure industry role contributions be fully disclosed,” said the report by the Senate Committee on Finance.

In reaction Medtronic said in a statement on its website that it “vigorously disagreed” with the allegations of influencing or authoring the publications or under-reporting adverse events.”In addition, the report’s characterization of payments received by physicians is also misleading and unfair,”

Medtronic said.Infuse, which was approved by the U.S. Food and Drug Administration in 2002 for spinal surgery, generated sales of about $800 million in the fiscal year 2011. Based on previous settlements paid by Medtronic and the current trajectory of this case, $800 million seems hardly worth the trouble.

—Tom Finn