Abbott (NYSE:ABT) has reached a settlement with the U.S. Department of Justice over a False Claims Act lawsuit involving St. Jude Medical and its ICD batteries.
The lawsuit — filed in U.S. District Court in Maryland — claimed that St. Jude Medical knowingly sold ICDs with battery problems between November 2014 and October 2016. Abbott acquired St. Jude Medical for $25 billion in January 2017.
Without admitting liability, Abbott has agreed to pay $27 million to settle the case.
“Medical device manufacturers have an obligation to be truthful with the Food and Drug Administration (FDA), and the U.S. government will not pay for devices that are unsafe and risk injury or death,” said acting U.S. Attorney Jonathan F. Lenzner for the District of Maryland.
“The government contends that St. Jude knowingly caused the submission of false claims and failed to inform the FDA with critical information about prior injuries and a death which, had the FDA been made aware, would have led to a recall,” Lenzner said in a U.S. Department of Justice News release posted yesterday.
The government claimed that St. Jude Medical failed to disclose premature battery depletion problems involving its Fortify, Fortify Assura, Quadra and Unify devices — even though the company was aware as early as 2013 that lithium clusters formed on device batteries were causing the batteries to short.
By late 2014, St Jude Medical asked FDA to approve a change to prevent lithium clusters from draining batteries, saying at the time that there were no serious injuries or deaths, according to the DOJ. In fact, the company was aware of two reported serious injuries and one death, the government claims.
In August 2016, the company disclosed to FDA there had been 729 battery depletion events, with two deaths and 29 instances of loss of pacing. Within months, a Class I–level recall was underway, according to the government.