The U.S. Food and Drug Administration (FDA) announced on Dec. 11, 2014 that a major medical device CEO had been convicted of severe criminal charges, which included withholding vital safety information concerning the company’s knee replacement implants.

Former OtisMed Corp. CEO Charlie C., was convicted of distributing unapproved orthopedic cutting guides for knee replacements as far back as 2009.

The investigation started after Stryker executive, Richard A., filed a knee replacement lawsuit against OtisMed for allegedly violating the False Claims Act, which allows citizens to sue corporations on behalf of the federal government.

Charlie had allegedly held a conference call with other executives on Sept. 9, 2009, regarding several ways of distributing their implants through various methods. For example, it was suggested that the knee replacements were taken to an off-site location by using his personal FedEx account and backdating shipment times.

This plan was initially successful, as 218 unapproved OtisMed knee replacements had been shipped and sold in September 2009 to surgeons across the country. At that time, Stryker Corporation had acquired OtisMed and had not been aware of the fraudulent actions.

However, Stryker had discovered this misconduct in August 2013, when its ‘Stryker ShapeMatch Cutting Guides’ had become the center of concern for health officials. These officials stated that these cutting guides, originally produced by OtisMed, could lead to a potential range of problems for the patient after knee replacement surgery.

The knee replacement side effects mentioned in the warning included: joint instability, loss of mobility, loss of motion, osteolysis, and the possible need for revision surgery. It is important to note that the FDA had rejected OtisMed’s 510(k) application for its implant.

If it had been approved, OtisMed’s ShapeMatch Cutting Guides would have been allowed to be sold without extensive preclinical trials, if it proved to work at an equivalent level of a similar product, already on the market. Its application had been rejected based on the fact that the company had failed to prove the device was safe.

The former OtisMed CEO ultimately pled guilty to three misdemeanor charges, with one felony count of selling a misbranded medical device. The criminal fines and forfeitures ultimately totaled $40 million, with an additional $41.2 million in civil liability charges for defrauding Medicare and insurers. The Stryker executive will receive $7 million from the payout.

Overview of Knee Replacement Complications

Knee replacement surgery is frequently practiced in the United States, due to the constant demand of elderly patients’ orthopedic requests. Ideally, this would allow the patients to return to their normal routine and maintain a healthy lifestyle, which would result in greater mobility and longevity.

Unfortunately, it has been recently alleged that knee implant manufacturers have prioritized their profit margin over the safety of patients. These patients have reported that their knee replacement implants had left them in worse shape than they had been before the surgery.

The knee replacement side effects mentioned in injury reports include the device prematurely loosening, severe pain, inflammation, limited mobility, infection, and bone or joint damage.

According to experts, artificial joints like knee replacement implants are expected to last at least 15 years for the patient. However, studies have indicated that newer knee implants are not able to outlast older models, and are actually weaker in some cases.

A number of these knee manufacturers are facing legal scrutiny for allegedly trying to hurry their products onto the market without proper medical testing due to the rapidly increasing elderly population. This is a major concern for the medical community, because defective knee implants can impose serious health risks for patients, including permanent joint damage.

This has resulted in an escalating legal movement, with claims of negligence, false advertising, concealing information, and misrepresenting a product.