Oregon Department of Justice

Attorney General Ellen F. Rosenblum

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PHARMACEUTICAL COMPANY PAYS OREGON $167,000 TO RESOLVE ILLEGAL MARKETING ALLEGATIONS

May 11, 2011

Stryker Biotech will pay $167,000 to resolve allegations of unlawfully marketing several bone products

Attorney General John Kroger today announced a $167, 000 settlement with the Massachusetts-based biotechnology firm Stryker Biotech, LLC, (Stryker) over its alleged involvement in an unlawful scheme to promote bone growth products.

"We will not tolerate dishonesty by medical device and drug manufacturers," said Attorney General Kroger.

In 2009 Stryker was indicted by federal prosecutors on various fraud charges. Among other things, the company was charged with participating in an illegal marketing scheme to promote the firm's Stryker's OP-1 and Calstrux bone products.

The Oregon Department of Justice opened an investigation into Stryker in September of 2010, which yielded evidence that the company engaged in similar conduct, on a limited basis, with respect to marketing these particular products in Oregon. Specifically, DOJ alleges that Stryker promoted Calstrux as a carrier for OP-1 Implant and OP-1 Putty, a use not approved by the U.S. Food and Drug Administration (FDA). The prohibition against off-label promotion is intended to ensure that medical products are safe and effective for a particular use before a company markets them as such.

OP-1 and OP-1 Putty are morphogenic agents used to promote bone growth in limited circumstances when bones fail to mend. Calstrux is a bone void filler used to fill up unfilled space in a bone during various orthopedic procedures. Some surgeons found Stryker's OP-1 and OP-1 putty difficult to work with and the company introduced Calstrux, which had a more desirable consistency - as a vehicle to hold the OP-1, a purpose that the Federal Food and Drug Administration never determined was safe and effective. 

Stryker reportedly failed to disclose known safety risks or that the products were never studied or approved for use together. Calstrux was ultimately pulled from the market.

Although the Department of Justice concluded that only nine units of Calstrux had been sold in Oregon, Stryker agreed to pay $167,000 to resolve claims related to the off-label marketing and pay for the cost of Oregon's investigation. The settlement also includes injunctive terms prohibiting the company from making any claim regarding the safety or effectiveness of a product for uses unapproved by the FDA or misleading or deceiving healthcare professionals about the appropriate use of Stryker products. 

The case was handled by David Hart, Assistant Attorney in Charge of Financial Fraud/Consumer Protection, and Assistant Attorney General Merrill Maiano.

The Oregon Department of Justice is recognized as a national leader in the fight against health care fraud. In addition to prosecuting criminal health care fraud, the Department of Justice has filed lawsuits against pharmaceutical companies for conducing fraudulent marketing campaigns. In the past year alone, the Oregon Department of Justice's Medicaid and Financial Fraud units recovered $33.5 million for Oregon from companies like AstraZeneca, GlaxoSmithKline and Omnicare for defrauding Oregon consumers and the state Medicaid program.

Attorney General John Kroger leads the Oregon Department of Justice.  The Department's mission is to fight crime and fraud, protect the environment, improve child welfare, promote a positive business climate, and defend the rights of all Oregonians.

Contact:

Tony Green, (503) 378-6002 tony.green@doj.state.or.us |
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