Harsh Punishment on the Horizon for Company, and Perhaps its Executives, Who Failed to Warn

A federal judge in Minnesota has rejected a proposed plea agreement between the federal government and Guidant Corporation, in which Guidant had agreed to plead guilty to two criminal misdemeanors and to pay a $296 million fine for continuing to sell heart defibrillators after discovering that some might short-circuit and fail, The New York Times reports. Federal Judge Donovan W. Frank said, in his 37-page opinion [PDF], that provisions of the agreement were not in the best interest of justice and do not serve the public’s interest because they do not adequately address Guidant’s history and the criminal conduct at issue.”

The problems associated with Guidant’s defibrillators, which have reportedly been associated with 6 deaths, came to light in 2005 when The New York Times published an article based on interviews of two Minneapolis cardiologists who treated Joshua Oukrup, a 21-year-old college student who reportedly died when his Guidant defibrillator short-circuited as it was charging to send out its life-saving jolt. Although Guidant had reportedly become aware of the defect associated with its product, its representatives merely fixed the flaw in new devices without warning doctors or regulators about the problem. As such, patients continued to get the potentially flawed older devices because the company did not pull them from hospital shelves.

Guidant’s chief medical officer explained that “the company had not seen a compelling reason to issue an alert to physicians about the defibrillators because the failure rate was very low and replacing the devices might pose greater patient risks.”

Mr. Oukrup’s treating cardiologist said that this was “a statistical argument that has little to do with real people.” In fact, prior to Judge Frank’s April 27 ruling, Mr. Oukrup’s two treating cardiologists wrote a letter [PDF] to the court urging the judge to reject the plea agreement. The doctors wrote that they were “extremely dismayed” with the decision to enter such an agreement with the company rather than to “prosecute the company and the individuals responsible for this egregious act.”

Judge Frank noted in his ruling that it is up to prosecutors, not the court, to decide who should be prosecuted. But his rebuke of the proffered plea deal certainly calls into question: “Who should be held accountable when a company sells a flawed product that can injure or kill patients? Is it the company or the people who run it?”

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