A medical device company based in Upper Saucon Township agreed to pay $38.5 million to settle a federal claim over its allegedly faulty knee replacements, according to a news release.
Bone cement would frequently come loose after surgery with Vega Knee Systems replacement knees and require follow-up repairs, according to the release from the U.S. Attorney’s office.
Aesculap Implant Systems sold the devices even though the failure rate was higher than allowed, according to the release issued Monday.
Loosenings are an unavoidable risk for all knee implants and can happen due to surgical technique and patient-specific conditions, according to a statement from Aesculap. The company updated its surgical technique guide and provided training to doctors between 2018 and 2019 because some doctors weren’t following Aesculap or bone cement manufacturers’ instructions, the Aesculap statement says.
“(Aesculap) continues to maintain that it did not knowingly cause false claims of any kind to be submitted to the federal government and maintains the safety of its products,” Aesculap wrote.
The U.S Attorney’s office says Aesculap sold the failure-prone knee replacements from July 2010 through June 2023. The company no longer sells knee replacement devices in the United States as of April 2024, the U.S. Attorney’s office says.
U.S. Attorney David Metcalf said Aesculap misled doctors and regulators by concealing information about its product failures.
“Medicare and other federal programs should not be required to pay charges for devices that are unduly risky, and that may require painful and expensive surgeries to fix,” Metcalf said in a prepared statement.
The settlement also resolves allegations that the company made illegal payments to a doctor in Georgia. The doctor experienced problems with the Vega implant, and Aesculap allegedly gave him consulting payments, free international travel and entertainment to convince him to keep using the product.
Aesculap’s news release says the allegations about the Vega implants and the doctor were largely addressed in earlier product liability litigation, which resulted in more than half of the cases being dismissed without merit. Aesculap says it agreed to settle the remaining cases to avoid the delay and expense of more litigation.
Finally, Aesculap won’t be prosecuted for distributing two medical devices without required clearance from the U.S. Food and Drug Administration. Aesculap Regulatory Affairs Specialist Peter N. Stoll III was sentenced to a year in federal prison in January 2024 for faking federal clearances for two Aesculap products: a high-speed drill used to cut through bone, and a brand of metal containers used to sterilize surgical instruments.
About $123,000 worth of medical devices were sold between March and August 2017 without the proper clearances, court records say.
“Distributing such medical devices without FDA clearance … can put patients at risk,” said FDA Metro Washington Field Office Acting Special Agent in Charge Ronald Dawkins in a statement.
Aesculap fired Stoll and reported his misconduct to the FDA, according to the company statement. The government agreed not to prosecute Aesculap as part of the global settlement.
The investigations into Aesculap resulted from tips reported under the U.S. False Claims Act. Tips and complaints about potential fraud, waste, abuse and mismanagement can be reported to the U.S. Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
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