How to make a lot of money - sell defective product

http://www.nbcnews.com/id/3079876/ns/dateline_nbc/t/hip-replacement-investigation/#.VOO491Io61t

Aug. 12, 2003
Lea Thompson

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“Dateline NBC” has the results of a six-month investigation into a medical catastrophe. “Dateline” reviewed hundreds of documents, documents that show one of the largest manufacturers of medical devices was keeping information from the government, from doctors and from patients.

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Susie: “I slipped and that’s when I felt pain just go up my leg.”

Surgery was supposed to restore Susie’s active lifestyle.

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Susie’s doctor chose an innovative, top of the line implant called the “Inter-Op” hip made by Sulzer Orthopedics of Austin, Texas.

Thompson: “You went into surgery worried? Apprehensive?”

Susie: “I was really excited because I was in so much pain.”

Her surgeon, Michael Britt, had used the Sulzer implant successfully, dozens of times.

Britt: I felt it was a trustworthy product.

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Dr. Britt told Susie her new hip was expected to last up to 30 years. But it only took a few weeks to figure out something wasn’t right — Susie wasn’t getting any better.

Susie: “Oh, I was in pain. Oh my gosh. I had a burning pain in my hip that you could not imagine. [crying] And I was just taking pills after pills.”

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Naomi: “I became so despondent. I told my daughter, I don’t care whether I live or not if I have to go through this.”

Joel, once an agile rancher thought a new hip would put him back in the saddle again. But after surgery, he felt it was hopeless.

Joel: “If they have to take my leg off, you know, then let’s take it off. Let’s get it done and get it over with. I want out of this pain.”

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Living on pain pills, resigned to a life of misery, Joel and the others were soon stunned by a startling announcement. Seemingly out of the blue, Sulzer, the maker of all those hip implants, said, it was not the doctors’ or patients’ fault — the implants were defective.

Sulzer Tape: “I’m Gary Sabins, president of Sulzer Orthopedics... On December 5, 2000, our company began a voluntary recall of specific lots of our Inter-Op acetabular shells used in hip implants.”

So 40,000 artificial hips were recalled. But the problem was that 17,500 of them were already inside patients.

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But the patient’s tears would soon turn to anger as some of them began to hear whispers that Sulzer had known about problems with its hip implants long before it told anybody. What they heard was right. While Sulzer was telling patients in this video release it took action as soon as it saw a problem, “Dateline” has put together a timeline that shows the company knew far more than it let on publicly, months before it announced the recall.

In the summer of 2000, at least seven months before the recall, Sulzer started getting reports from doctors that its Inter-Op hips were failing. One doctor, an actual designer of the hip said, “something strange” was going on.

By late September, seven doctors were reporting 21 failed implants, but the company didn’t say anything — so surgeons were replacing defective Sulzer implants in people like Joel with, incredibly enough, another Sulzer hip made in exactly the same way.

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More than a month and a half before the recall, that same designer was telling the company, “I have a bit of an epidemic here.” And a month before the recall, 14 doctors were reporting hip failures. But still, there no warning bulletins to doctors. Instead, the company was writing memos to sales agents giving them kudos on hitting an all time sales record, “1500” implants sold in the past month.

Two weeks before the recall, 29 doctors were reporting problems, and internal documents reveal the company suspected a “cleaning problem” with the implants. But doctors were still putting them inside people’s bodies.

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By the time of the December recall, seven months after the first complaint, Sulzer knew of 110 hip failures, including 61 cases where the implant had to be removed.

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Parisien: “They were concerned about the competition, about their impression with the physicians, but not about the patients... If you’re not selling a safe and effective product, then you’re not in compliance with the law.”

And what is the law? The law says if a company gets a serious complaint about a medical device, it must investigate and report the problem to the FDA. If a company knows a product puts patients at risk, the law says it must stop selling the device, even if it doesn’t know why it’s failing.

But former FDA medical officer Parisien says based on her reading of the documents in this case, that is not what Sulzer did.

Parisien: “They were doing everything they could to try to hide that there was an issue going on with their device. They were trying to sell more hips.”

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For years, Sulzer hips were made by a subcontractor who had a good track record. That may explain why so many doctors were later caught off guard. After all, why would a part that was for years reliable, suddenly become defective? But what the doctors didn’t know, was that in order to cut costs, Sulzer decided to change the manufacturing process.

First, it decided to make all the hips in house, no more subcontractor. Then, to save money, Sulzer cut out a key step on the assembly line — a key step in the cleaning process that would have removed lubricating oil, used in the machining of parts, from the surface of the implants. And how much did that save the company?

Ironically, dropping that procedure only saved one dollar 15 cents per implant on a device for which patients are billed more than $9,000.

Michael Froehlich: “They were never satisfied with what their profits were.”

Froehlich worked as an inspector for Sulzer at the time.

Froehlich: “It was an ineffective process. They used the wrong cleaning process from the beginning.”

“Dateline” has discovered Sulzer never did any testing for oil contamination after it dropped the cleaning step, a clear violation of FDA rules. And Froehlich says a company engineer told him oil contamination on the implants might have also come from another source.

Froehlich: “They were handled improperly by machinists who were handling these parts with contaminated dirty, oily, gloves.”

An internal Sulzer report confirms workers “dropped implants on the floor,” “got oil on their hands” and “did not use gloves while handling parts.”

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As a result of this medical disaster, people like Susie Kuhn would have to have their failed hip implants removed and go through more, nightmarish surgery. And what brand of new hip was likely to be implanted? Believe it or not, another Sulzer. That’s because Sulzer brought back all those contaminated hips, not yet implanted in patients, re-cleaned them and promised doctors a safe product. No more oil, no more problems. Guess again.

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“Dateline” has uncovered several cases where patients did die of complications as a result of having defective Sulzer implants removed. The company, meanwhile was trying to cut its losses. Rather than destroying the recalled hips, Sulzer had those not yet implanted in patients returned to the plant. It announced it could re-clean them with a new, improved process that would get rid of the oil. Michael Froehlich worked as a parts inspector at the Sulzer plant.

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Unbelievable as it may sound, Susie’s supposedly oil-free hip implant failed in exactly the same way as the first hip.

Michael Froehlich isn’t surprised. He says the company, at least initially, never changed the cleaning process on the recalled hips, a process it knew by then was faulty.

Froehlich: “When they did bring in all the parts and tried to re-clean them, they immediately encountered problems. The plan that they set out to re-clean the parts failed.”

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But, former Sulzer employee Michael Froehlich differs with Sulzer’s account. He says, for instance, he was told by a supervisor to lie on company records.

Froehlich: “We falsified records, we falsified test results.”

Thompson: “Falsifying records is illegal.”

Froehlich: “It probably is, at the time I wasn’t informed of that. I understand it is now.”

Thompson: “Why did you do it?”

Froehlich: “I did it because the environment there in the plant was so pervasive with this kind of behavior, there just wasn’t any dissent. They assured me the shortcuts that we were taking would not affect the quality of the part.”

Froehlich says he finally went over the heads of his supervisors to top company management and told them what was going on, and he was fired. Sulzer says its investigation found Froehlich violated company procedures and falsified records on his own, not at the direction of supervisors.

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But wait, there’s even more. Sulzer also made artificial knees at that Austin plant. But at the time of the hip recall the company said the oil problem did not extend to any of its other products and told the government it was confident in the safety of its knees. Right on its Web site it said, “no other Sulzer Orthopedics products are suspect. Our other products do not go through the same manufacturing process.” But as “Dateline” has discovered, the company knew that wasn’t true.

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What Roger didn’t know was that months before his implant, a Sulzer vice president was telling his staff that “Word is beginning to spread” of loose knee implants. And e-mails from doctors were alerting Sulzer that failed knee implants “appeared to have the same symptoms” as the recalled hips.

Thompson: “When Sulzer recognized that it had a problem with hip implants did it also by definition have a problem with knee implants?”

Froehlich: “The knee implants which were produced in the same way as the hip implants, they should have definitely known that there would be a contamination risk with those lots of knees.”

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What really makes him furious is that just a month after his first surgery, the company abruptly stopped selling that knee implant, yet never called his doctor.

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According to court records, of the over 1,300 Sulzer knees implanted after it changed its cleaning process, at least 600 had to be removed. Still, there has never been any recall. The company says for business reasons — not safety — it pulled them off the market so there were no knees left to recall. And that is what Sulzer also told the FDA. But internal documents obtained by “Dateline” show at about the time Sulzer stopped selling knees, it knew of at least 20 failed knee implants already removed from patients and knew of more than 35 other suspect cases.

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Well it appears the FDA’s file in this case, obtained by “Dateline,” simply doesn’t contain much of the information in our report. Typical of cases involving a voluntarily recall, the government relied heavily on information supplied by the company.

Thompson: “Was Sulzer honest with the FDA?”
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Parisien: “Not from the documentation I’ve seen. They were not.”

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Parisien: “Yes, there was a cover-up by Sulzer to keep the information from the physician, and the public and the FDA.”

One reason Dr. Parisian believes there was a cover-up was because the company told the FDA it only heard about hip failures two and a half months before the recall, not seven months as “Dateline” has found.

And why didn’t Sulzer notify doctors and the FDA sooner? Sulzer contends it needed time to figure out the problem and until it knew the cause, alerting the public and the medical community would have been been irresponsible and caused widespread panic. Dr. Parisien says that’s no excuse.

Parisien: “And the minute they knew this product was not performing the way it was supposed to, that’s when they should have said, stop using this product, we’re doing a recall. The law doesn’t say you have to have the fix.”

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As for those manufacturing changes which led to the defective hips, the company says in addition to being a cost cutting move, it removed steps from the cleaning process because at the time, it didn’t think they were necessary. Sulzer also says it was trying to cut down on the use of hazardous chemicals in the plant.

So far, almost 4,000 defective implants have been removed from patients. Sulzer, which has since changed its name to Centerpulse

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