Business Week
The U.S. Department of Justice filed charges against Boston Scientific Corp.'s Guidant division Thursday, saying Guidant did not fully disclose problems with its devices to regulators.
The charges are part of a previously announced agreement for Boston Scientific Corp. to plead guilty to the two misdemeanor charges.
The company, based in Natick, Mass., agreed in November to plead guilty to the two counts, which had not yet been filed, and pay $296 million to resolve the investigation.
The investigation concerned three implantable heart devices. The Justice Department said Guidant discovered in 2002 that its Ventak Prizm 2 DR was prone to electrical arcing, which could keep the device from responding when the patient suffered irregular heart rhythms.
Guidant changed the design of the device in November of that year, but in August 2003, it told the Food and Drug Administration that the changes did not affect the safety or effectiveness of the device.
In early 2004, the company allegedly found a similar problem with two other devices. A patient died in July 2004, and the Justice Department says that death was related to a short circuit.
Following the death, Guidant knew the instructions for responding to a short circuit in the device were false and misleading, the Justice Department says. As a result, the company sent out new information that was described only as a product update. The charges say Guidant broke the law by not notifying the FDA about the change within 10 days.
In June 2005, Guidant issued safety advisories on the three devices. The FDA determined these were Class I recalls, which are the most serious type of device recall because there is a reasonable change the devices could cause serious health problems or death.
Boston Scientific acquired Guidant for $26 billion in 2006.
The charges are part of a previously announced agreement for Boston Scientific Corp. to plead guilty to the two misdemeanor charges.
The company, based in Natick, Mass., agreed in November to plead guilty to the two counts, which had not yet been filed, and pay $296 million to resolve the investigation.
The investigation concerned three implantable heart devices. The Justice Department said Guidant discovered in 2002 that its Ventak Prizm 2 DR was prone to electrical arcing, which could keep the device from responding when the patient suffered irregular heart rhythms.
Guidant changed the design of the device in November of that year, but in August 2003, it told the Food and Drug Administration that the changes did not affect the safety or effectiveness of the device.
In early 2004, the company allegedly found a similar problem with two other devices. A patient died in July 2004, and the Justice Department says that death was related to a short circuit.
Following the death, Guidant knew the instructions for responding to a short circuit in the device were false and misleading, the Justice Department says. As a result, the company sent out new information that was described only as a product update. The charges say Guidant broke the law by not notifying the FDA about the change within 10 days.
In June 2005, Guidant issued safety advisories on the three devices. The FDA determined these were Class I recalls, which are the most serious type of device recall because there is a reasonable change the devices could cause serious health problems or death.
Boston Scientific acquired Guidant for $26 billion in 2006.
