Guidant Pacemaker and Defibrillator Recalls: $195 Million Settlement to be Paid

Minneapolis, MNBoston Scientific Corp. announced July 13 that it has agreed to pay $195 million to settle about 4,000 claims associated with defective Guidant pacemakers and defibrillators manufactured by the company it acquired last year, Guidant Corp. Since June, 2005, Guidant has issued safety warnings or recalled more than 88,000 defibrillators and about 200,000 pacemakers.

The company said in a statement that it reached the agreement during mediation sessions with U.S. Magistrate Judge Arthur J.Boylan in Minneapolis. The claims had been consolidated in federal court, with the first case due to start trial July 30. The settlement covers an unspecified number of other similar claims from across the country, but does not cover all outstanding claims over the defective devices.

"We are pleased by this resolution, which is in the best interest of all involved," Jim Tobin, president and chief executive officer of Boston Scientific, said in a statement. "It will better allow us to focus our time and resources on developing innovative products to serve physicians and patients."

The plaintiff in the first trial is a 73-year old Californian, Lepoldo Duron. He became so fearful when he learned about the recall of his implanted Prizm defibrillator that he wrote his own obituary, and eventually had surgery to have the device removed and replaced. Duron's case represented a group whose devices never malfunctioned, but who demanded compensation for anxiety and their unpaid medical expenses.

Guidant was criticized for dragging its feet in notifying doctors, patients and regulators about the problems which caused some of the devices to short circuit. The defective devices led to at least seven deaths. The final cost of these defective devices, both for patients who received the implants, and to Boston Scientific, is far from being known, as the lawsuits other than those consolidated in Minnesota are still proceeding.