Medtronic: “Infuse lawsuits coming to a close”

Medical device company, Medtronic, has recently suffered a lengthy legal headache when the company faced allegations of defrauding shareholders by reportedly covering up negative side-effects of its Infuse bone growth product for 10 years.

Infuse is a genetically engineered protein that causes bones to fuse for use during lower spinal surgery; intended as an alternative to bone grafts. Thousands of patients complained that the product was used inappropriately and that it had caused permanent and devastating injuries.

These were allegedly covered up.

It’s possibly surprising that such a product could’ve been approved by regulators, yet it was granted approval in 2002. On 28^th June 2011 an article was published in the Spine Journal which revealed clinical studies alleging doctors who had financial ties to Medtronic understated the risks associated with the use of Infuse.

In October 2012, the U.S. Senate Finance Committee found that Medtronic had allegedly heavily influenced the content of the studies. This led to Medtronic’s shareholders suing the medical device company on 27^th June 2013, stating that its activities falsely inflated the company’s stock price.

When the news of the discoveries emerged, they lost hundreds of millions of dollars in share value.

Medtronic’s alleged misconduct

Circuit Judge Raymond Gruender said that shareholders pleaded that they relied on Medtronic’s alleged misconduct:

“…a company cannot instruct individuals to take a certain action, pay to induce them to do it, and then claim any causal connection is too remote when they follow through.”

Judge Gruender confirmed that Medtronic’s alleged manipulative conduct directly caused the biased clinical trial results that the shareholders and market relied on.

Settlements?

Last month, Medtronic said they were ready to settle one of its longest legal battles, but didn’t release the settlement figure amount. According to the Securities and Exchange Commission filing, Medtronic put aside $300 million (£228 million) for all legal settlements in the financial year ending April 2017.

Medtronic confirmed they’re still cooperating with Attorney Generals in California, Illinois, Massachusetts, Oregon and Washington to gather information on how the medical device company studied, marketed and sold Infuse.

Medtronic spokesman, Eric Epperson, stated the company’s eagerness to settle the issue:

“…we continue to cooperate in the State AG inquiries and are hopeful an acceptable resolution can be reached.”

Historically, Medtronic has denied wrongdoing and lawsuits from patients, investors and employees (whistle-blowers). They claimed that, for many years, the company promoted the sales of Infuse for surgeries even though there were never proven to be safe. Medtronic is reportedly on their way to reaching settlements in more than 4,000 patient lawsuits.

Offensive settlement offers?

The settlements have not proven to be favourable for some patients…

Pat Beaudry from Minnesota was left with debilitating pain on his left side after using Infuse during back surgery. To this day, he needs a cane to assist with walking and he’s unable to move his left leg. He also claims numbness in his left hand.

He reportedly relies on opioid drugs daily to relieve his nervous system of pain. Mr Beaudry expressed his disappointment with his compensation:

“…my settlement was based on $27,000 (£21,000). By the time it was done, I got $2,200 (£1,700).”