Federal investigators recently launched an additional inquiry into Johnson & Johnson (NYSE:JNJ) and its DePuy Orthopaedics subsidiary, taking a closer look at marketing practices surrounding a line of recalled metal-on-metal hips.
J&J confirmed in regulatory filings last week that the U.S. State Attorney’s Office for the District of Massachusetts and the Civil Division of the U.S. Justice Dept. had made "informal requests" for information about the ASR XL Hip devices.
Initial requests were made in August 2012 and additional inquiries have been made since then, according to a regulatory filing.
"The government is investigating whether any person or entity submitted or caused to be submitted false claims or false statements affecting federal health care programs in connection with the marketing and use of the ASR XL Hip device," J&J reported. "DePuy Orthopaedics, Inc., DePuy Synthes, and Johnson & Johnson Services, Inc. have voluntarily produced documents in response to the government’s informal requests and are fully cooperating with the government’s civil investigation."
DePuy voluntarily recalled the ASR hip devices in August 2010 after receiving reports that a higher-than-normal number of patients required surgeries to correct or remove defective implants. The company said it was pulling the ASR XL Acetabular and ASR Hip Resurfacing systems from the market "due to the number of patients who required a second hip replacement procedure, called a revision surgery." More than 96,000 patients were been affected by the massive global recall.
As of Dec. 30, 2012, there remain about 10,750 plaintiffs in pending lawsuits regarding the ASR XL acetabular system and the DePuy ASR hip resurfacing system, according to J&J’s recent filing. There are also about 3,300 plaintiffs with claims against the Pinnacle acetabular cup system.
The Pinnacle device, which pre-dates DePuy’s ASR implant by a few years, is like its older cousin in that it’s been found to shed minute particles of metal as the hip’s ball joint wears on the metal cup. DePuy’s Pinnacle implants have not been the subject of a recall, but became the focus of heightened scrutiny amid the high-profile recall of the company’s metal-on-metal ASR implants, a move which spurred class action and multi-district lawsuits, public outcry and FDA scrutiny.
In August 2012 reports emerged that J&J had settled a trio of metal hip lawsuits out of court at a rate of about $200,000 per plaintiff.
J&J named the ongoing ASR hip implant recall among the primary drivers of a decease in profit margins for its medical devices & diagnostics business, which reported $7.19 billion in pre-tax profits for fiscal year 2012. Dealing with the ASR hip recall shaved $110 million off of the division, according to the regulatory filing.