For Immediate Release - August 26, 2010

AG Coakley Announces $1.35 Million Settlement with Stryker Biotech

Consent Judgment Resolves Allegations that Stryker Biotech Violated Laws Intended to Protect Patient Safety

BOSTON - Stryker Biotech, a Hopkinton-based medical device company, will pay $1.35 million to the Commonwealth to resolve allegations that it marketed certain orthopedic products for uses that had not been reviewed and approved by the U.S. Food & Drug Administration (FDA) and misled health care providers about the appropriate uses of its products, Attorney General Martha Coakley announced today.

As a result of a multi-year investigation, the Attorney General's Office alleged that Stryker Biotech LLC (Stryker) violated the state's Consumer Protection Act by engaging in unfair and deceptive trade practices that boosted sales of certain products used in orthopedic procedures to strengthen and promote growth of bones. Under the terms of a settlement filed yesterday in Suffolk Superior Court, Stryker will pay $325,000 in civil penalties, $875,000 to fund efforts to combat unlawful marketing and other programs to benefit health care consumers, and $150,000 to cover attorneys' fees and investigative costs.

"Stryker Biotech subverted review procedures designed to safeguard patients and promoted uses of its products that were not shown to be safe or effective," AG Coakley said. "Our office will vigorously pursue any allegations that health care companies are compromising patient safety in pursuit of profits."

The Attorney General's investigation focused on the company's marketing of OP-1 Implant and OP-1 Putty, which are bone morphogenetic protein products designed to promote bone growth and are used to treat orthopedic conditions involving weakened or deteriorated bones. The OP-1 products were granted a limited approval by the FDA that restricted the use of the products. With this limited form of approval, the OP-1 products could only be used in patients after a hospital's Institutional Review Board reviewed and approved their use.

In a complaint filed in Suffolk Superior Court yesterday, the Attorney General's Office alleged that Stryker promoted OP-1 products for conditions that fell outside their very narrow FDA-approved uses and withheld information from health care professionals about the restrictions imposed on the use of the OP-1 products. The complaint also alleged that a Stryker salesperson falsified Institutional Review Board documentation for several Massachusetts hospitals, resulting in the use of OP-1 products in patients without adequate and required review.

In addition, the Attorney General's complaint alleged that Stryker promoted the use of its OP-1 products in combination with Calstrux, a bone void filler made by Stryker, even though the mixture of the two products had not been studied and had not been approved by the FDA. Stryker continued to promote the unproven and unstudied OP-1/Calstrux mixture even after company officials became aware of reports that the mixture had caused adverse effects in patients, including poor wound healing and inflammation, according to the complaint.

Today's settlement bars Stryker and related Stryker entities including Stryker Corporation, Stryker Sales Corporation and Howmedica Osteonics, from engaging in unfair and deceptive trade practices, including marketing Stryker products for uses that have not been reviewed and approved by the FDA and misleading health care providers about the appropriate uses of Stryker products.

The Massachusetts Consumer Protection Act gives the Attorney General broad authority to investigate health care companies for engaging in unfair and deceptive trade practices, including marketing products for unapproved or "off-label" uses, as well as failing to disclose critical information about the appropriate use and risks associated with health care products.

Today's settlement is the latest in a series of court actions brought by the Attorney General's Office in response to unfair and deceptive marketing activities by pharmaceutical companies and health insurers.

This investigation and resolution was handled by Assistant Attorney General Sarah Ragland with assistance from Assistant Attorney General Susan Brown and Division Chief Thomas O'Brien, all of AG Coakley's Health Care Division.

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