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In the interest of speed and timeliness, this story is fed directly from the Associated Press newswire and may contain spelling or grammatical errors.
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Guidant subsidiary to end production of aortic graft
Monday June 16, 2003
INDIANAPOLIS (AP) A subsidiary of medical device manufacturer
Guidant Corp. is ending production of an aortic abdominal graft,
only days after the unit pleaded guilty to criminal charges for
covering up problems with the product that may have led to 12
deaths.
Endovascular Technologies Inc., a subsidiary of
Indianapolis-based Guidant, pleaded guilty to 10 felonies last week
involving its Ancure ``stent-graft'' device, including shipping
misbranded products and making false statements to government
regulators.
Endovascular faces $92.4 million in federal penalties for
actions surrounding the device.
Guidant officials said Monday that Menlo Park, Calif.-based
Endovascular would cease ongoing operations other than continuing
to provide long-term services for patients who have received the
device. It will continue to ship the device until October.
Guidant officials said they expected the total after-tax loss
from the discontinued operations, including settlement charges and
operating losses to be $100 million to $125 million for 2003. The
majority of affected employees will be offered other positions
within Guidant, the company said.
In morning trading on the New York Stock Exchange, Guidant
shares were up 30 cents, or 0.8 percent, to $40.25.
The problems with the device, used during operations to treat
abdominal aortic aneurysms, were resolved after the device was
voluntarily recalled in March 2001 and before it was reintroduced
five months later, the company said.
The device, inserted through the groin, was designed to let
doctors patch the aneurysm without requiring risky surgery to open
the abdomen.
The criminal complaint against Endovascular alleged the company
misled federal regulators and reported only 172 malfunctions.
Prosecutors said Endovascular had records of 2,628 malfunctions,
including reports that the incidents may have led to 12 deaths and
57 surgeries to remove the device.
On the Net:
http://www.guidant.com
(Copyright 2003 by The Associated Press. All Rights Reserved.)
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