Lawsuit Against Medtronic Alleges Racketeering Over Infuse Bone Graft

by Searcy Denney Scarola Barnhart & Shipley
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When one big industry sues another we learn a lot about how business as usual is conducted.

In this case Humana, a giant health insurer, has sued the medical device company Medtronic, maker of the Infuse bone graft.  In its lawsuit filed in federal court in Tennessee’s Western District, Humana accuses Medtronic of aggressively pushing the bone graft for off-label uses.

The action accuses Medtronic of RICO violations – Racketeer Influence & Corrupt Organizations- which can be leveled if a company allegedly lies to the public, conceals adverse events and changes the complication rates to make the product look less dangerous as part of a deliberate, deceitful campaign.

The Spine Journal’s June issue in 2011 was devoted exclusively to the adverse events being seen with the use of Infuse including an increased risk of cancer and male sterility, among other side effects.

“Defendants also aided and facilitated hospitals and physicians in obtaining payments from Humana through false statements and fraudulent omissions and concealment to obtain insurance payouts where Infuse and/or BMP was used. Humana would not have paid for Infuse if it had known the true facts regarding the uses of Infuse and/or BMP or the risks and efficacy of such uses” says the lawsuit.

In this case, Humana relied on the allegedly fraudulent literature created by the company written by doctors who were on the receiving end of consulting contracts with Medtronic and who published in professional journals for over a decade. Doctors pay attention to the endorsements by other doctors. Those who bought Infuse, along with hospitals, claim they were sold a bill of goods on the validity of the Infuse product and Medtronic allegedly promoted its use for purposes not approved by the Food and Drug Administration (FDA).

Humana says had it known the facts it would never have covered the medical costs for the Infuse bone graft product.  Medtronic tells MassDevice the allegations are not true and the lawsuit is “baseless.”

Infuse is a bone morphogenetic protein (BMP-2) which is a growth factor that stimulates bone growth. It is used to treat degenerative bone disease in the spinal disc, tibia fractures and for dental use but the risks of promoting it for off-label use are not understood. Infuse was approved by the FDA in 2002 to fuse the spinal lumbar and is intended to replace the need to harvest a patient’s own bone.

Medtronic makes about $700 million annually from the sale of Infuse.

A Senate committee and the Department of Justice launched an investigation into the spine surgery product which concluded with no fines or charges being issued. In 2012 a Senate report concluded Medtronic deliberately omitted evidence of complications while aggressively promoting Infuse for off-label use.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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