Feds Close Investigation Into Medtronic’s Infuse Product

The findings of a probe into Medtronic's marketing of its Infuse bone-graft product weren't released, but Medtronic said it is pleased that the investigation is closed.

Medtronic, Inc., announced Wednesday that federal prosecutors have closed an investigation into the Fridley-based company's marketing practices surrounding its Infuse bone-graft product.

An investigation by the U.S. Department of Justice and the U.S. Attorney's Office in Massachusetts began in 2008 and looked into whether Medtronic marketed the Infuse product for uses not approved by the U.S. Food and Drug Administration (FDA).

Infuse is approved for use in spinal, oral, and dental graft procedures, but it has reportedly also been used in neck surgeries and other procedures. While doctors can use drugs and medical products as they see fit, it is illegal for companies to market their products for uses not approved by regulators.

Medtronic spokeswoman Cindy Resman told Twin Cities Business that regulators notified the company that they completed the investigation and “closed the file without further findings.” But according to Resman, the government has not told Medtronic whether it found any wrongdoing.

Resman did say that “this probably means that Medtronic will not face any fines pertaining to this investigation.”

A spokeswoman for the U.S. Attorney's Office in Massachusetts declined to comment on the findings of the investigation.

“After several years of investigation, we are pleased that the Department of Justice and the U.S. Attorney's Office have come to the decision to close their investigation of the company related to Infuse bone graft,” Chris O'Connell, executive vice president and group president for Medtronic's restorative therapies division, said in a statement.

The Department of Justice investigation wasn't the only piece of controversy surrounding Medtronic's Infuse product.

In late March, Medtronic paid $85 million to settle a shareholder class-action lawsuit that was filed in 2008. The lawsuit claimed that Medtronic misled shareholders by not disclosing how much of the company's Infuse-related revenue was derived through uses that were not approved by the FDA. The lawsuit also accused Medtronic of illegally marketing the product for unapproved uses.

In mid-2011, medical publication The Spine Journal published two articles about Infuse, one that claimed the product may increase the risk of sterility in men, and another that claimed that the product's adverse effects were not properly reported in clinical research. The publication pointed out that researchers for 12 of the product's 13 industry-sponsored studies had multimillion-dollar “financial associations” with Medtronic.

Then in June of last year, two members of the Senate Finance Committee sent a letter to Medtronic, seeking information about the use of the Infuse product and payments that the company made to its clinical investigators. And in October, California Attorney General Kamala Harris issued a subpoena for documents related to the Infuse product.

Meanwhile, Medtronic in August announced that it provided a $2.5 million grant to Yale University for an independent investigation of the Infuse product.

Resman said that she couldn't comment on the Finance Committee inquiry or any ongoing litigation. She did say, however, that findings of the Yale University investigation will likely be released this fall.

Tim Nelson, an analyst in the Minneapolis office of Nuveen Asset Management, told the Pioneer Press that Medtronic's troubles with Infuse are far from over and that the company still faces civil lawsuits related to the product.

Medtronic is the world's largest medical device company and Minnesota's seventh-largest public company based on revenue, which totaled $15.9 billion for the fiscal year that ended in April 2011. The company will release financial results for its latest fiscal year next week.