Guilty in the media, but dropped for lack of evidence, was the conclusion of the US Justice departments off label marketing probe of Medtronic’s Infuse.
Last year, we reported that the U.S. Senate Finance Committee had begun an investigation regarding whether doctors with financial ties to medical device maker Medtronic were aware of serious problems with a widely promoted spinal fusion product, known as Infuse, but never disclosed potential health complications in articles in medical journals.
Infuse, which the Food and Drug Administration (FDA) approved in 2002, contains a genetically engineered version of a naturally occurring protein that can stimulate bone growth. It is an alternative to procedures like autologous grafting, where bone is taken from elsewhere in the patient’s body. Those procedures can cause lasting pain. Since its approval, Infuse has been implanted in more than 500,000 patients by more than 2,300 surgeons, and has Earned Medtronic millions of dollars in annual sales.
However, three years ago, concerns about unapproved use prompted the U.S. Department of Justice (DOJ) to issue a subpoena. In addition, the Finance Committee and the Senate Special Committee on Aging submitted their own inquiries into Medtronic. Since then, a series of reports in the Milwaukee Journal-Sentinel revealed ties between Medtronic and doctors who allegedly failed to disclose Infuse problems.
In July 2008, the FDA issued a warning letter about off-label use of the protein in InFuse. The agency said there had been reports of life-threatening complications associated the protein. “The reason why doctors saw fit to use the product off-label was because of heavy promotion activity from the company,” said Salvatore Graziano, who was lead counsel in a shareholder lawsuit filed in 2008. “The FDA actually approved InFuse for a very, very narrow application because of concerns for serious side effects.”
Consequently, DOJ recently closed its years-long criminal and civil investigation into Infuse. As noted by MassDevice, “The office of the U.S. Attorney for the District of Massachusetts and DOJ abandoned their civil and criminal probe into allegations of off-label marketing and concealed safety risks without finding evidence of wrongdoing.”
“After several years of investigation, we are pleased that the Dept. of Justice and the U.S. Attorney’s Office have come to the decision to close their investigation of the company related to Infuse bone graft,” restorative therapies group president Chris O’Connell said in prepared remarks.
A Medtronic spokeswoman said the government notified the company that DOJ and the U.S. Attorney for Massachusetts found no evidence of wrongdoing.
Although the federal investigation is over, Medtronic is still on the hook in a separate shareholder suit accusing it of inflating share prices using misleading statements about Infuse. In that case, the shareholders demanded confidential documents from an undisclosed witness who staunchly refused to reproduce them on the grounds that they presented “a real and appreciable danger of self-incrimination.”
At least four whistleblower lawsuits have been filed by former Medtronic employees alleging the company courted doctors with lavish perks and lucrative consulting deals.
The company is also still battling patient injury lawsuit, including a complaint unsealed this month that alleged that Medtronic installed a paid crony at the Journal of Spinal Disorders and Techniques in order to push positive – and possibly premature – data on its Infuse bone growth stimulant.
“Given the duration of the investigation, we are surprised that the DOJ walked away empty-handed,” Larry Biegelsen, a senior analyst with Wells Fargo Securities, said in a written comment to the Journal Sentinel. Biegelsen, who follows the company for investors, said he expected sales of the “beleaguered product” to continue to decline, but the end of the investigation could slow the drop.
In a statement, U.S. Sen. Chuck Grassley (R-Iowa), senior member of the Senate Finance Committee, said the Justice Department apparently was not able to meet the high burden of proof needed to justify criminal charges.
“Scrutiny will continue to ensure that mistakes aren’t repeated,” he said. He said payments made to doctors by Medtronic make a good case for implementing the Physician Payment Sunshine Act. The federal legislation will require that all payments made by drug and device companies to doctors be made public.
Interestingly, this is the second case over the past few months that DOJ has decided been unsuccessful with. As we noted back in March, an off-label case against Stryker Biotech Corporation went from thirteen felony charges into a settlement for a single misdemeanor plea and a fine of $15 million.