By Karen Gullo
Jul 2, 2014 4:20 PM CT
Johnson & Johnson (JNJ) will pay Oregon $4 million to
resolve deceptive
marketing claims over recalled metal-on-metal hip implants in its first accord with any
governmental unit involving the devices.
While the sum
is dwarfed by J&J’s earlier settlement of patient lawsuits linked to the
ASR hip, the agreement may lead the way for additional accords as federal and multi-state probes
continue into the company’s sales of the device.
“Oregonians in
need of a hip replacement deserve to know that the artificial hip they are
contemplating in fact has the qualities, and benefits, that a company
advertises,” Oregon
Attorney General Ellen Rosenblum said in a statement. “Doctors also need
to know that the products they suggest to their patients meet certain
standards.”
Oregon is at
the forefront of the investigations, Rosenblum said. A group of state attorneys
general is investigating how the hips were marketed, while the U.S. Justice
Department and the U.S. Attorney’s Office in Massachusetts are
probing whether the company made false claims or false statements about the
devices to federal health care programs, J&J said in a May regulatory
filing.
Oregon began
looking at the implants in 2011 and opened an investigation about a year before
a multi-state probe began, state Assistant Attorney General David Hart said
in a phone interview. J&J’s
DePuy, the maker of the devices, began settlement discussions with state
officials after they prepared a civil complaint, he said. DePuy sold 432 metal-on-metal, chromium and
cobalt hip devices in Oregon from 2005 to 2010, according to Rosenblum.
Unfair Practices
The payment to
the state resolves claims that the company violated Oregon’s unfair business practices
law by telling patients and doctors that the hips functioned properly when evidence showed they were
failing at unusually high rates.
“If other
government entities obtained similar payments from DePuy based on the number of
devices sold, it would be a very large number and significant deterrent,” Hart
said. He declined to comment on the multi-state probe.
DePuy
didn’t admit wrongdoing under the agreement, Mindy Tinsley, a DePuy spokeswoman, said
in an e-mail, declining to comment on the probes.
J&J has
voluntarily turned over documents responding to “informal” U.S. requests for
information related to the hip device and is fully cooperating with the
government’s civil investigation, the company said in the May regulatory
filing.
Patient Suits
The company
last year said it would pay at least $2.47 billion to resolve thousands of lawsuits over the
implants. The agreement resolved about 8,000 U.S. suits against DePuy brought
by patients who have already had artificial hips removed.
The New Brunswick, New
Jersey-based company
recalled 93,000 ASR hip implants worldwide in August 2010, saying 12 percent
failed within five years.
J&J had
touted the metal-on-metal implants, first sold in the U.S. in 2005, as a new design that would last 20
years and offer greater range of motion.
As failures
mounted, patients complained in lawsuits that the implants caused dislocations,
pain and follow-up surgeries known as revisions. They claimed that debris from the chromium and
cobalt device caused tissue death and increased metal ions in the bloodstream.
To contact the
reporter on this story: Karen Gullo in federal court in San Francisco at kgullo@bloomberg.net
To contact the editors responsible
for this story: Michael Hytha at mhytha@bloomberg.net
Fred Strasser, Stephen Farr
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