Boston Scientific said it would settle some 1,850 pending federal lawsuits that alleged the company sold faulty defibrillators and pacemakers. Boston Scientific acquired liability for more than 100,000 Guidant Corporation cardiac-assist devices when it purchased Guidant in 2006. The case was consolidated in the U.S. District Court in Minneapolis.

Boston Scientific estimated the lawsuits could cost the company $732 million. The company’s chief executive, James Tobin, said he was “pleased” with the agreement. The company still faces about 100 state product liability lawsuits not included in the federal settlement.

Source: Keith Winstein, “Boston Scientific Will Settle Federal Suits,” Wall Street Journal, July 14, 2007.

The New York Times reported today that Guidant Corporation, maker of the heart defibrillators that have been the subject of a wave of recent recalls due to short circuits and other defects, has filed reports with the U.S. Food and Drug Administration about three more deaths associated with defects in their devices since they were recalled. Including the most recent reports, the total number of deaths associated with flaws in Guidant heart devices has now reached seven.

The New York Times said doctors and families of heart patients might be more likely to have the units checked for problems because of the increased scrutiny on Guidant. Guidant received a U.S. Justice Department subpoena in October 2005 concerning some of the recalled devices and is currently a takeover target among competitors in the medical device market. Both Johnson & Johnson and Boston Scientific Corporation have made offers for the troubled company.

Source: Barry Meier, “More Deaths are Linked to Device,” New York Times, December 14, 2005; “Report: More deaths linked to heart devices,” Reuters, December 14, 2005.

Guidant Corporation’s Cardiac Rhythm Management group, now a subsidiary of Boston Scientific, has announced yet another recall of its implantable heart devices. It is recalling 22,600 of a specific subset of pacemakers and defibrillators that were not a part of any previous recall due to a defective part that may deplete the batteries of the devices or cause them to malfunction. Another 27,200 of the devices are already implanted in patients and may suffer from the same defect. People who have the devices currently implanted are urged to consult their doctors for tests to determine whether the devices are functioning properly.

This new batch of recalls includes cardiac resynchronization pacemakers and implantable cardioverter defibrillators that contain defective low-voltage capacitors. Some of the capacitors may lead to premature battery depletion or intermittent or permanent loss of therapy, leading to inappropriate sensing of heart rhythm. Five adverse events have been confirmed by Guidant’s CRM division with these devices, including two events where patients lost consciousness as a result. No deaths have been reported.

The devices included in this recall are:

• Guidant INSIGNIA pacemakers
• Guidant NEXUS pacemakers
• Guidant CONTAK RENEWAL TR cardiac resynchronization pacemakers
• Guidant CONTAK RENEWAL TR2 cardiac resynchronization pacemakers
• Guidant VITALITY implantable cardioverter defibrillators
• Guidant VITALITY 2 implantable cardioverter defibrillators
• Guidant VENTAK PRIZM 2 implantable cardioverter defibrillators

Boston Scientific and Guidant are advising doctors to schedule an in-clinic visit with patients as soon as possible to assess the function of their implanted devices in order to determine if they have this defect. While the companies have stated that it believes there may be only two to three additional devices out of this recall that may be defective, “We will have further recalls,” James Tobin, Boston Scientific’s chief executive, said. “I also know that everybody in the industry will have further recalls.”

Guidant has identified the supplier of the defective capacitors traced to this latest safety issue, but said it will not be able to complete an overhaul of its quality control systems by the fourth quarter of this year as demanded by the U.S. FDA in a January warning letter. Boston Scientific has decided to have independent auditors review its quality control changes before it has the FDA approve them, contributing to the delay.

Patients are advised to discuss any concerns with their doctors or contact Guidant Patient Services:

Guidant Corporation 4100 Hamline Ave. North St. Paul, MN 55112 1-866-GUIDANT (1-866-484-3268)

Sources: Sylvia Pagan Westphal, “Pacemakers Flagged in Fresh Recall,” Wall Street Journal, June 27, 2006; Barnaby J. Feder,” Thousands of Devices for Hearts are Recalled,” New York Times, June 27, 2006; FDA Release, June 26, 2006; Guidant Letter to Patients, June 23, 2006, accessed June 27, 2006.

Guidant Corporation announced August 1, 2005, that it has received approval from the U.S. Food and Drug Administration to relaunch its best-selling Contak Renewal 3 implantable defibrillator. The Contak Renewal 3 is currently implanted in about 40,000 patients worldwide an was previously recalled due to a faulty switch that could short-circuit, causing shocks to the patient as well as equipment failure that could render a patient unprotected from a potential heart attack.

The relaunched medical device will have a new switch that has been approved by the FDA. The company has faced intense criticism due to its failure to warn patients and doctors of defects found in its medical devices despite deaths attributed to them.

Source: “Guidant relaunches heart device,” Associated Press, August 2, 2005.

Guidant Corporation said today that a programming change it suggested to doctors in June for its Ventak Prizm, Vitality and Contak Renewal implantable defibrillators might actually increase the risk of malfunction in these models. Guidant ‘s Ventak Prizm, Vitality and Contak Renewal defibrillators are implanted in about 21,000 heart patients worldwide.

The company discovered that a malfunction occurred in one of the devices after it was reprogrammed. In that instance the patient was not injured but had to have the device replaced. Guidant is now investigating other reports of malfunctions, including a possible personal injury. Last month Guidant issued safety warnings on 11 defibrillator models after several deaths were linked to defective medical devices. The FDA went on to classify Guidant ‘s safety warnings as recalls.

On July 18, Guidant also issued warnings on 9 of its implantable pacemaker models, which the FDA classified as Class I recalls on July 22. Class I is considered the most serious recall class issued by the FDA and is reserved for devices that are likely to cause serious personal injury or even death. The company promised it would have a permanent fix available for its defective defibrillators, pending FDA review, in the fourth quarter of this year.

Sources: “Guidant’s defibrillator fix may raise other risks,” Associated Press, July 23, 2005; “Guidant revises recommendations on ICD fix,” Reuters, July 22, 2005.

An FDA analysis of Guidant implantable defibrillators written on June 16, 2005 stated that the devices may experience malfunctions leading to failures at a rate 10 times higher than that stated by Guidant within the next five years. The analysis was a confidential document unsealed this week in a product liability lawsuit involving Guidant’s products in Texas.

Guidant Corporation recalled over 100,000 implantable defibrillators last year after an electrical malfunction was revealed that could lead to the device failing. The devices are supposed to deliver an electrical shock in the event of abnormal heart rhythm to prevent atrial fibrillation, or pooling and clotting of the blood in the chambers of the heart. Atrial fibrillation leads to heart attacks, strokes and cardiac deaths.

After Guidant began its series of recalls, the company stated that no more than 292 of its units were likely to break down. The unsealed FDA document could damage the position of Boston Scientific, Guidant Corporation’s new parent company, which bought the company for $27.5 billion in April 2006. Boston Scientific said in a May 2006 regulatory filing that 340 personal injury lawsuits against Guidant are in the courts so far. The company anticipates as many as 3,000 more product liability and personal injury lawsuits to be filed.

Source: “Boston Scientific device woes grow,” Bloomberg News, June 23, 2006.

Guidant Corporation issued a warning to doctors nationwide Monday, March 13, 2006, that more of its implantable heart devices may be defective. The company has received 39 reports that its Contak Renewal 3 RF and Contak Renewal 4 RF implantable heart defibrillator devices that were tested before being implanted into patients had lower than expected battery voltage. The voltage decline is related to a sustained, low level current that can only occur during storage and shipment before implantation, according to the company. None of the 39 devices were put into patients.

About 4,000 Contak Renewal 3 RF and 4 RF devices have been implanted into patients worldwide. The U.S. Food and Drug Administration is reviewing whether to classify this latest Guidant problem as a product recall. Boston Scientific is still expected to continue its acquisition of Guidant Corporation. Both companies have continued to be plagued by problems with their medical devices.

Source: “Guidant cautions doctors to check some defibrillators,” Associated Press,” March 13, 2006.

In two long memos made public in a product liability lawsuit against Guidant Corporation filed in Texas, a paid consultant to the company told Guidant that he believed it had a clear ethical obligation to tell doctors about defects in its heart defibrillators, and that its decision to withhold such data was questionable. The consultant, Dr. Richard N. Fogoros, noted that Guidant was violating a “sacred obligation” it had to doctors by interposing its medical judgment for theirs, when it made the judgment call that patients faced greater risks from replacement surgery than from the flaws in their defibrillator units. In doing so, Guidant was working for a position in which it had a clear conflict of interest that would lead it to disclose product failures to doctors only when “absolutely necessary.”

The memos were written in May 2005, just after Guidant told a Minneapolis physician, Dr. Barry J. Maron that a patient of his had a type of Guidant defibrillator that had a flaw causing it to repeatedly short-circuit. Dr. Maron immediately urged Guidant to alert physicians worldwide about the device defect; when the company failed to do so, Dr. Maron and a colleague, Dr. Robert G. Hauser, contacted the New York Times. Soon after, Guidant began a wave of recalls that eventually applied to more than 100,000 devices.

Dr. Maron is now scheduled to testify before a Senate Judiciary Committee that is considering possible new legislation that would make it a federal crime for a corporate executive to knowingly distribute a defective product.

Source: Barry Meier, “Guidant Consultant Advised Company to Release Data on Defects,” New York Times, March 9, 2006.

On the same day that Guidant Corporation accepted a buyout order from Boston Scientific, Boston Scientific had to accept a warning order from the U.S. FDA. Stating that it may now take regulatory action against Boston Scientific without further notice, the FDA cited heart stents manufactured at the company’s Natick, MA, headquarters, Maple Grove, MN, and Spencer, IN, as not being made to quality and safety regulations despite previous quality control inspections and notices of violations.

The letter also cited continuing problems at sites where it had previously found shortcomings. Those production facilities are in Watertown, MA; Glen Falls, NY, and Quincy, MA. The letter blames management for failing to set up adequate systems to insure the quality of products manufactured at the six facilities, including artery-opening stents, catheters and needle electrodes.

In the summer of 2004, Boston Scientific was forced to recall nearly 100,000 units of its best-selling Taxus coated stent and another uncoated model because of a manufacturing defect that was not fixed, although the company claimed it was. In June 2005, Guidant Corporation recalled about as many implantable heart defibrillators.

Source: “FDA sends warning letter to Boston Scientific,” Associated Press, January 26, 2006; “US FDA warns Boston Scientific over broad problems,” Reuters, January 26, 2006.

The U.S. Food and Drug Administration (FDA) issued additional information to the public on July 1, 2005, concerning recalled heart defibrillators manufactured by Guidant Corporation. The agency classified the 11 devices recalled by Guidant according to classifications that indicate the probability that device failure could lead to adverse health effects.

Three Guidant defibrillators were classified as Class 1 devices, the most serious classification available. In a Class 1 recall, there is a reasonable probability that if a particular device is malfunctioning, the malfunctioning device will cause serious adverse health consequences, including death.

The Prizm 2 Model 1861, Contak Renewal Model H135, and Contak Renewal 2 Model H155 defibrillators were all classified as Class 1 devices. Two deaths have been associated with the estimated 20,600 of these devices still implanted into patients worldwide.

The FDA has classified the Ventak Prizm AVT, Vitality AVT, and Renewal AVT devices as Class II recalls. For a Class II recall, the malfunctioning product may cause temporary or medically reversible adverse health consequences. These three devices are subject to a memory error which may limit available therapy to a patient during a cardiovascular event. Two incidents have been confirmed with these devices, neither of which resulted in death or injury. Guidant is recommending that these devices be reprogrammed by the patient’s physician.

Contak Renewal 3, Contak Renewal 4, Renewal 3 AVT, Renewal 4 AVT, and Renewal RF devices have also been classified as Class II recalls. These devices are subject to a component failure: a magnetic switch may become stuck in the closed position, inhibiting the device’s ability to treat irregular heart rhythms. Four incidents have been confirmed out of approximately 46,000 defibrillators implanted worldwide. In all four of these cases, patients were alerted to the problem by audible device tones signaling the switch malfunction. Any patient who hears tones from their defibrillator device should immediately contact their physician or go to a hospital emergency room.

For more information, visit the FDA’s Talk Paper on Guidant Defibrillators.

A class action lawsuit has been filed in Canada on behalf of patients who received defective defibrillators manufactured by Guidant Corporation. The suit alleges that despite knowing its defibrillators were defective, Guidant continued to market the defibrillators without disclosing the problem to medical professionals and patients. Guidant’s defibrillators have been linked to at least four incidents of short-circuiting, including one which resulted in the death of a U.S. patient.

Guidant manufactures the defibrillators, which are devices used to control irregular heartbeats by delivering electrical shocks to the heart when irregular rhythm is detected. With the short-circuit defect, the defibrillator is no longer able to detect irregular rhythm. In May of this year, Guidant communicated the failure to physicians despite having received complaints about their products going back to 1994.

Source: “Guidant national class action commenced,” Yahoo!Finance, June 29, 2005.

An article published in the May 24, 2005, edition of the New York Times tells the story of 21-year old college student Joshua Oukrop, who was afflicted with a genetic heart disease and implanted with a defibrillator made by Guidant Corporation. In March Oukrop died on a bicycling trip when, after complaining of fatigue, he suddenly fell to the ground and died of cardiac arrest. Guidant acknowledges that its implanted device was responsible.

The defibrillator, marketed under the brand Ventak Prizm 2 Model 1861, is surgically implanted in the chest under the skin and sends out an electrical charge to try to shock a chaotically beating heart back into normal rhythm when it becomes erratic. Guidant’s defibrillators are implanted in an estimated 24,000 people in the United States.

A flaw in the device has caused a small number of those units to short-circuit and malfunction. Guidant said it had changed its manufacturing processes over three years ago to fix the problem but did not notify physicians about the defibrillators because the failure rate was “very low and replacing the devices might pose greater patient risks.” The short circuit problem was fixed in 2002. The problem has not appeared in devices manufactured since then.

In interviews, doctors who treated Oukrop were angered by Guidant’s decision not to notify physicians. They felt the company had received enough reports about flaws to establish a pattern, and because high-risk patients could suffer potentially catastrophic results. When told the New York Times was preparing to release an article about the device, Guidant suddenly issued an advisory to doctors.

Guidant is one of the largest makers of medical devices with a reported $3.8 Billion in sales, almost half of that coming from implantable defibrillators. One defibrillator can cost up to $25,000, and doctor and hospital costs for the surgery can run another $15,000. Defibrillators also need to be replaced every five or six years because their batteries drain.

Implantable defibrillators are among the fastest-growing group of medical devices. The New York Times reported that more than 200,000 patients are expected to receive the implant this year. In December of 2004, Johnson & Johnson announced plans to purchase Guidant in a deal worth over $25 Billion. Mr. Oukrop’s father said he is likely to hire a personal injury lawyer to redress his son’s death.

Source: Barry Meier, “Maker of Heart Device Kept Flaw From Doctors,” New York Times, May 24, 2005.

In a letter made public today, Guidant Corporation told doctors to stop implanting its Contak Renewal 3 and 4, Renewal RF, Renewal 3 AVT and Renewal 4 AVT heart defibrillators due to an electrical defect that could cause the devices to fail. Previously this week, Guidant announced a recall of its Prizm 2, Contak Renewal and Contak Renewal 2 defibrillators due to a similar defect. The newly detected defect is a magnetic switch that can become stuck, draining the battery and preventing it from being available when needed.

Guidant said 46,000 of these devices are affected and confirmed four incident reports of defibrillator failure, saying a fifth case is suspected but not yet confirmed. While no injuries have yet been reported, the U.S. Food and Drug Administration may issue a recall of these devices. This brings the number of defibrillator models by Guidantconsidered defective to 10. Over 100,000 defibrillators may be involved.

In the four cases mentioned in today’s announcement, patients were warned of device problems by audible tones from the devices. The tones signified that the magnetic switch was closed. Defibrillators were replaced in patients who heard the tones. Doctors were instructed to program new devices so that the “enable magnet use” function was turned to the “off” position to avoid switch malfunction.

Guidant faces legal liability in these recalls because it neglected to warn patients and doctors of the risks inherent in its devices after it discovered them.

Source: “Guidant tells doctors to halt use of defibrillators,” Bloomberg News, June 24, 2005.