Unusual punishment for medical device crime
Wednesday, October 6th, 2010
A medical device company with US headquarters in West Chester pleaded guilty to using its product in unauthorized human experiments. As WHYY's health and science reporter Kerry Grens details, the punishment for its crime is unusual.
In an unprecedented move, the US Attorney in Philadelphia signed a plea agreement with the company Synthes that it must sell off its subsidiary, Norian. Norian was responsible for testing out its bone repair product on patients without approval from the FDA.
Aarti Shetty is an industry analyst at Frost and Sullivan. She says she's never seen a deal like it before where a company had to sell off a piece of itself.
Shetty: This is definitely something that's extreme in asking Synthes to sell Norian in a limited time frame. But I don't think of it as extremely unreasonable.
Shetty says a sale depends on what Norian has to offer, such as manufacturing facilities or distribution platforms.
Shetty: It's going to be a big hurdle to sell the company as such. Norian, it's a product in an emerging space but there have been so many problems with it that I'm just worried as to who would come up to the table and buy Norian.
Synthes must sell Norian by May 24, or start paying fines.