Stryker Biotech Indicted for Fraudulent Promotion of Surgical Medical Devices

Stryker Biotech and its top management have been indicted by the U.S. Department of Justice (DOJ) on charges that they committed fraud and illegally promoted medical devices used for bone surgery, which resulted in serious medical problems for some patients.

The indictment was handed down Wednesday and charges the Stryker Corp. subsidiary, its former president, Mark Philip, and its current sales managers, William Heppner, David Ard and Jeff Whitaker, with fraudulently marketing the OP-1 putty bone implant. The defendants were charged with five counts of wire fraud and one count of conspiracy. In addition, the company and Philip face charges of making false statements to the FDA, and the company, Ard and Whitaker have been charged with misbranding.

The allegations stem from the company’s use and marketing of the OP-1 bone implant, a bone putty which has limited FDA approval for use in a condition that affects less than 4,000 people in the U.S. The product could not be sold for profit.

The FDA and DOJ allege that the defendants illegally promoted OP-1 for other, unapproved uses, including mixing the putty with a bone void filler called Calstrux, and providing recipes to healthcare professionals on how to use the two items together for bone surgeries, even though such use has never been studied in clinical trials or approved by FDA. The defendants also allegedly lied to FDA about how many patients were using OP-1 bone implants.

A DOJ press release states that some patients suffered serious medical problems as a result of the use of OP-1 and Calstrux bone surgeries, but does not detail the types of injuries or the number of incidents.

The charges come just days after Stryker claimed that it was making headway on several concerns raised by the FDA in recent warning letters to the company. Stryker Biotech said it had resolved all the issues in an April 2008 letter from FDA, in which agency inspectors determined Stryker did not get the proper FDA approval for the OP-1 implant. In that warning, regulators also expressed concerns over Institutional Review Board (IRB) documents that appeared to have been falsified by Stryker sales personnel.

Philip, Ard and Whitaker face up to 20 years in prison and more than $250,000 in fines as a result of the charges, and Stryker Biotech could face fines in excess of $500,000, or double the company’s gross gain through its allegedly fraudulent practices.