Zimmer Durom Hip Lawsuit Reserves Increased to Cover Claims

During their fourth-quarter earnings report this week, Zimmer Holdings, Inc. announced that they have already set aside a total of $69 million to cover payments for potential lawsuits over their Durom Cup hip replacement parts, increasing their reserves by nearly 50%.

The reserves are have been designated to cover both known and anticipated Zimmer Durom hip lawsuit claims by individuals who have had problems with a hip replacement part sold since 2006 in the United States.

In July 2008, sales for the Zimmer Durom Acetabular Component, which is commonly referred to as a Durom Cup, were suspended in the United States after doctor’s reported high rates of patients who had their hip replacement fail after surgery. Reports involved loosening of the implanted hip replacement parts, causing many patients to require additional hip surgery.

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According to Zimmer’s own estimates, some doctors experienced failure rates as high as 5.7% in the United States. Even though only about 12,000 of the hip replacements were implanted since they were approved by the FDA in 2006, Zimmer could face hundreds of potential Durom hip lawsuit cases.

The Zimmer Durom hip replacement parts were reintroduced in August 2008, with revised warning information and new training program that surgeons were required to undergo about the special techniques not required with other types of hip replacements that are necessary to avoid the Zimmer Durom Cup problems.

Zimmer began setting aside funds to cover potential hip patient injury claims during the third quarter, with an initial reserve of $47.5 million.

On January 29, 2009, they announced that an additional $21.5 million has been set aside, bringing the total amount to $69 million. It is also possible that additional funds could be allotted in future quarters, as it is unlikely that the first Zimmer Durom hip lawsuit will reach trial before mid-2010.


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