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FDA and DOJ Challenge St. Jude Medical About Off-Label Marketing; Other Firms Under Investigation

The U.S. Food and Drug Administration (FDA) has accused St. Jude Medical Inc. of illegally marketing its Epicor surgical ablation devices for off-label use.

FDA officials claim several of the marketing statements made by the St. Paul, Minn.-based company violate the federal Food, Drug and Cosmetic Act. One statement that particularly irked the FDA appeared on St. Jude’s website last year. In that declaration, the company claimed its Epicor system is “designed to safely, effectively and reproducibly create a classic box lesion in a single step,” according to an April 23 warning letter from the FDA.

FDA officials took issue with that statement because a box lesion is a type of burn that only would be used in atrial fibrillation surgery. The company’s Epicor LP Cardiac Ablation System and Epicor UltraCinch LP ablation device are approved only for general ablation during surgery; to promote the two products for ablation surgery, St. Jude would have to conduct additional, lengthy studies of Epicor.
A spokeswoman for St. Jude Medical told The Wall Street Journal that the company is “working diligently to address the points raised in the warning letter and to resolve the FDA’s concerns.” St. Jude executives do not expect the warning letter to affect sales of ablation devices.

The Epicor product line was acquired by St. Jude through the $185 million acquisition of Epicor Medical Inc. in June 2004. Cardiac ablation devices are used to treat a heart rhythm disturbance known as atrial fibrillation, or A-fib, by destroying the tissue causing the irregularity. About 25,000 patients underwent surgery last year to repair their faulty heart rhythms, according to industry estimates.

While the devices generate tens of millions of dollars in sales for companies such as St. Jude Medical, the agency has not approved them to treat atrial fibrillation. Rather, the devices were approved to treat “ablation,” or the destruction of tissue (which historically was done by sealing a wound to stop bleeding).
This discrepancy is the target of an investigation by the U.S. Department of Justice (DOJ). Though doctors often use devices or drugs for off-label treatments, companies are required to market them only for the uses for which they have been approved by the FDA. Such a restricting is meant to limit the number of U.S. patients exposed to experimental, largely untested treatments.

In the last year, the government has won settlements from two surgical ablation device makers over the improper marketing of its products. Estech, a medical device firm based in San Ramon, Calif., agreed to pay $1.5 million last year to settle allegations that it marketed its surgical ablation devices for the unapproved purpose of treating irregular heartbeats. It did not admit any wrongdoing.

AtriCure of West Chester, Ohio, agreed to pay $3.8 million to resolve similar allegations. It also did not admit any wrongdoing.

The DOJ is investigating St. Jude Medical, Boston Scientific Corp., and Medtronic Inc. regarding the marketing of their surgical ablation devices.

In addition to the warning letter about its surgical ablation device marketing, St. Jude Medical also received a “civil investigative demand” from the DOJ related to reimbursements for its implantable cardiac defibrillator products. The request seeks documents related to communications “by and within the company on various indications” for the devices, company officials said in a regulatory filing.

Siemens Reshapes its Medical Technology Unit

Industrial giant Siemens has reorganized its healthcare business to take advantage of different market segments and growth opportunities—particularly the convergence of imaging and therapy.

Effective immediately, the company’s Healthcare division will still consist of three units—Imaging and Therapy Systems, Clinical Products and Diagnostics. Sales and service will be bundled into one group.
Under the umbrella of the new unit, Munich, Germany-based Siemens intends to better leverage the synergies between the imaging equipment and therapy solutions. The CEO of the Imaging and Therapy Systems unit will be Bernd Montag, who currently heads the Imaging & IT group. The company’s imaging equipment offerings include computer tomographs, magnetic resonance imaging equipment, and PET systems. Therapy solutions include angiography systems, linear accelerators, particle therapy systems, and devices for minimally invasive procedures. These systems are already closely linked with imaging equipment, in particular in therapy planning.

The Clinical Products group will include X-ray and ultrasound equipment that until now has been run jointly with the large-scale medical device business. The market segment for these products has a different dynamic than the market for large-scale medical devices, company officials said. Besides innovative high-end-solutions, the development of cost efficient, less complex equipment that meets essential customer requirements will be a focus for the unit. Siemens officials plant to grow sales for these products, particularly in emerging economies. Clinical Products also will include the company’s components business. Norbert Gaus, who has been in charge of the ultrasound business, will be CEO of Clinical Products.

Diagnostics will continue to comprise the laboratory diagnostics business. This includes equipment for analyzing blood and other bodily fluids as well as the necessary reagents. Michael Reitermann, previously responsible for the healthcare business of Siemens in the United States, will follow Donal Quinn as CEO of the Diagnostics Division. Quinn is leaving the company for personal reasons.
Sales and service will be managed the company’s Customer Services arm. In addition, the business with hospital information systems will also become part of this unit, due to its highly regional focus. The CEO of the new Customer Solutions unit will be Tom Miller, who has been heading up the Workflow & Solutions Division.

Hermann Requardt, CEO of Siemens Healthcare, said the demands of the various customer groups in the healthcare market have changed over time. Increasingly, large hospitals and clinics are seeking to differentiate themselves through customized high-end solutions, and are experiencing a growing demand for therapy solutions. Smaller hospitals and physicians in private practice, especially in emerging economies with above-average growth, are looking for cost-efficient and less-complex equipment. The hearing aid business is being spun off within the company.

For fiscal 2009, Siemens’ healthcare holdings posted approximately $17 billion in sales.

Zimmer Unveils New Surgeon Training Center in New Jersey

Traditionally, clinicians and surgeons who sought training on specific orthopedic procedures or with certain types of implants had little control over their educational destinations. Those who primarily used implants made by Zimmer Holdings Inc., for instance, could choose between two training facilities in the continental United States—Warsaw, Ind., or Carlsbad, Calif.

Now surgeons have a third choice: Parsippany, N.J.

In late April, Zimmer executives and Parsippany Mayor James R. Barberio celebrated the official opening of a training center at the company’s Trabecular Metal Technology facility in the northern New Jersey community. The “Zimmer Institute at TMT” (as it is called in marketing materials) is the company’s first full-time BioSkills training center outside Zimmer’s headquarters in Warsaw.

The Institute encompasses more than 15,000 square feet within the 113,000-square-foot facility on Zimmer’s 10.94-acre TMT campus in Parsippany. According to executives, the Institute offers cadaveric-based training as well as intensive case study reviews, simulations and anatomical model workshops. Zimmer officials estimate that more than 1,000 orthopedic surgeons and dental clinicians could potentially be trained each year at the facility.

“The new Institute at Trabecular Metal Technology provides a convenient and progressive environment for training orthopedic surgeons and dental clinicians from across the tri-state area and the eastern seaboard,” Richard Stair, Zimmer’s senior vice president, Global Operations & Logistics, told an audience of company executives, workers and media at the Institute’s ribbon-cutting ceremony. “Its proximity to New York City makes this location ideal for surgeons around the world.”

Seventeen thousand surgeons (or medical professions), to be exact. Michael Collins, vice president for Research & Development at Zimmer Dental, provided that estimate as he led a tour of the Institute’s state-of-the-art dental facility that provides training to medical professionals in both oral surgery and prosthetics. Clinicians undergoing the two-day training program in the dental facility work on lifelike mannequins that simulate the bones and soft tissue in real patients.

Near the dental training center is a simulated operating room equipped with a high-definition camera system that can broadcast procedures over the Internet. Zimmer officials said the room was designed to emulate a bona fide operating room so surgeons would be able to practice new procedures in a near-authentic environment. That realism translates to the “patients” as well—surgeons operate (and assist as well) on cadavers, honing their skills in such procedures as shoulder replacements, primary hip and knee arthroplasty, and revision hip arthroplasty.

“We want to give every surgeon the opportunity to place an implant inside the body as well as assist on these procedures,” said Tim Hoeman, director of brand management for Zimmer Trabecular Metal Technology. “Most of the training courses will last one day. Surgeons will do a primary [implant] case and then rip out that implant and perform a revision [implant] case. We want their experience to be as close as possible to the real thing.”
Zimmer officials also want surgeons to be as close as possible to the Trabecular Metal manufacturing process (hence the reason for locating the company’s newest training center in Parsippany). Executives hope surgeons who attend training at the Institute will leave with a better understanding of the Trabecular Metal technology.

“In addition to the classroom and laboratory resources offered at this site, training at the Trabecular Metal facility gives surgeons the opportunity to get an inside look at the Trabecular Metal manufacturing process,” said Jeff Paulsen, group president of Zimmer’s Global Businesses. “We hope that the Zimmer Institute here will give surgeons a better understanding of what makes this advanced platform technology so unique.”

What makes the technology unique (according to Zimmer, anyway) is its cellular structure and composition. The material is highly porous, making it ideal for bone formation, tissue infiltration and strong attachment. “The pore size and high volume porosity of Trabecular Metal supports vascularization and rapid, secure soft tissue growth,” promotional materials on the company’s website read.

Since its introduction more than a decade ago, Trabecular Metal has been used by more than 300,000 surgeons worldwide, Zimmer executives claimed. Products that have incorporated the technology over the years include the acetabular [hip] cup, the revision shell, a humeral stem and a reverse shoulder system.

More Infusion Pump Woes for Baxter; FDA Order Recall

In a move reflective of its quest for greater infusion pump safety, the U.S. Food and Drug Administration (FDA) has ordered Baxter International Inc. to recall and destroy all Colleague brand pumps currently on the market. The command, according an FDA news release, is based on a “longstanding failure to correct many serious problems with the pumps.”

Agency officials estimate the recall could affect as many as 200,000 Colleague Volumetric Infusion Pumps, a device that Baxter stopped selling in 2005 due to various design flaws and software issues. The pumps have been the subject of several Class I recalls for battery swelling, inadvertent power shutdowns and service data errors.

Baxter executives estimate the recall could cost the company up to $600 million. Officials have pledged to work with the FDA to minimize the disruption in service to hospitals and other health care facilities that still use the Colleague pumps. Affected customers, according to the company, could be entitled to a refund or an exchange (at no charge) for Baxter’s Sigma Spectrum infusion pumps.

“The situation has languished far beyond what it should have,” Bob Parkinson, Baxter’s chairman and CEO, told shareholders during the company’s annual meeting earlier in May. He said the type of design improvements requested by the FDA were “close to impossible” to achieve without “fundamentally redesigning” the Colleague pump.

Baxter has been operating under a 2006 consent decree with the FDA that allowed the agency to recall the pumps. Though they remain on the U.S. market, the Deerfield, Ill.-based firm has not sold or distributed them in five years. During its last full year on the market, the device generated $170 million in sales for Baxter.

An avalanche of documented reports of safety problems with infusion pumps over the last decade or so prompted the FDA to launch a new initiative late last month to address pump safety. Part of the initiative requires manufacturers to perform more testing on the devices before they can be sold to customers. Infusion pumps deliver fluids, including nutrients and medications, into a patient’s body in a controlled manner. They are widely used in hospitals, other clinical settings and, increasingly, in the home because they allow a greater level of accuracy in fluid delivery.”

“Infusion pumps … have been the source of persistent safety problems,” according to the agency. Just how persistent is astounding: In the last five years, the agency received more than 56,000 reports of adverse events associated with the use of infusion pumps, with 500 of those events resulting in deaths. Between 2005 and 2009, 87 infusion pump recalls were conducted to address safety concerns, FDA data show.

“An FDA analysis of these adverse events has uncovered software defects, user interface problems and mechanical and electrical failures,” according to a statement from the FDA statement. “Problems with infusion pumps are not confined to one manufacturer or one type of device.”

Jeffrey Shuren, M.D., head of the FDA’s Center for Devices and Radiological Health said many of the problems with the pumps seem to be related to “deficiencies in device design and engineering” more often than user error.

Novel Cardio Technology Firm Secures More Funding

CardioMEMS Inc., the developer of an implantable device to measure and transmit pulmonary artery pressure, has raised $37.9 million in additional capital.

According to the Atlanta, Ga.-based firm, this latest round will provide capital to complete a clinical trial of its heart failure pressure management system, called Champion, with 550 patients through 65 heart centers in the United States. The trial started in 2007 with results expected later this summer.
The device is a wireless high-frequency sensor implanted in the artery using a catheter-based procedure. The pressure is measured and displayed on a proprietary monitoring system. Following the procedure, patients perform wireless measurements of the pulmonary artery pressure from home. The data is transmitted to a secure database for physician review on a proprietary website.

Using radiofrequency, the company’s sensors transmit real-time data to external electronic readers, which then communicate information to the patient’s physician.

Company officials have said that their model of on-demand, real-time monitoring of vital information enables proactive patient management, which in turn reduces hospitalizations, improves patients’ quality of life, and delivers more cost-effective healthcare.