Lawyers See Lessons in ACell Criminal, Civil Cases

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Civil and criminal penalties in cases involving an ACell medical device deserve further study by other device companies, according to attorneys Anne Walsh and Adrienne Lenz (Hyman, Phelps & McNamara). In a blog post for their firm’s FDA Law Blog, the two first discuss two whistleblower cases alleging that the firm made false and misleading statements in off-label promotion of its MicroMatrix powder wound dressing. The company agreed to pay $15 million, plead guilty to a misdemeanor charge, implement extensive compliance activities, and be subject to a five-year corporate integrity agreement.

According to the post, the criminal plea was based on the company’s failure to report to FDA its decision to remove MicroMatrix from the marketplace, as required by Part 806 of agency regulations. It says that in 2012 ACell learned that some 30,000 units of the powder were contaminated with endotoxin levels that posed a risk to health. The company removed the devices, but concealed the reason for removal from healthcare providers and did not submit an 806 report to FDA.

On 6/11, the post says, the Maryland U.S. attorney charged ACell with a criminal misdemeanor, imposed a $3 million fine, and required the company to enact compliance reforms. The attorneys note that no company individuals were named in the plea, contrary to current Justice Department policy to go after responsible individuals, and the statement of facts both sides agreed the government could prove beyond a reasonable doubt at trial was expanded to include activities well beyond the single 806 reporting violation.“Medical device companies simply need to recognize the potential ramifications of the government’s enforcement of the 806 reporting obligations,” the post says.

On the marketing of the MicroMatrix product, the attorneys say the case turned on the “false and misleading” nature of the off-label promotion because no clinical data existed to support the claims. “Industry should not get too confident that off-label promotion investigations are bygone relics,” they say, “and as always should focus on ensuring there is proper substantiation for all product claims, whether on- or off-label.”

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