From time-to-time, Dr. D stumbles across articles that that should make every medical device industry executive cringe. You see, the Chief Jailable Officers (CJOs) that the doctor frequently mentions in the Devine Guidance (DG) blog actually face the threat of some serious jail time for certain indiscretions. For this week’s guidance, Dr. D will briefly discuss the trials and tribulations that two former Acclarent executives are about to face.
“William Facteau, 45, of Atherton, California, and Patrick Fabian, 48, of Lake Elmo, Minnesota, were recently indicted on one count of conspiracy, three counts of securities fraud, four counts of wire fraud and 10 counts of introducing adulterated or misbranded medical devices into interstate commerce.” Although the securities and wire fraud counts are serious accusations, the 10 counts associated with entering “adulterated or misbranded medical devices” into commerce is worthy of an eventual trip to hades in the afterlife, in Dr. D’s humble opinion. Willing to take risks with the general health and well-being of the American population in exchange for lining one’s pockets with the almighty dollar is never acceptable. When this case finally reaches the courts, the doctor hopes that the judge hands down a rhadamanthine (look-it-up) punishment to the defendants (if they are found to be guilty in a court of law – the doctor’s disclaimer). Please keep in mind these gentlemen are innocent until proven guilty in a court of law. Enjoy!
According to the indictment, the defendants allegedly began marketing the “Relieva Stratus MicroFlow Spacer” (a.k.a. a sinus cannula) for uses not cleared in the original 510(k) (K083574). The initial indication for use was for “use as a postoperative spacer to maintain an opening to the frontal sinuses within the first 14 days following surgery. The MicroFlow Spacer also helps to prevent obstruction.” However, the defendants’ allegedly launched a program that marketed the device for steroid delivery. The FDA refused Acclarent’s request for an expanded indication for use as a “drug delivery device.” Unfortunately, the defendants allegedly continued to market the device as a drug delivery system after the FDA said NO! Folks, when the FDA says no, they mean NO! Allegedly (remember the defendants are not guilt as of this DG posting), Facteau and Fabian continued down their precarious path in an effort to drive up projected revenue streams to make Acclarent appear as a viable acquisition target. In 2010, Ethicon (a Johnson & Johnson subsidiary) acquired Acclarent for $785 million. As a result of the acquisition, Facteau received approximately $30 million and Fabian received $4 million. The doctor hopes that the defendants still have some of their dollars remaining as their legal expenses are about increase exponentially.
For this week’s guidance, the doctor will leave the readers with just one takeaway. If the FDA fails to clear or approve a medical device or an expanded indication for use, “No means No!” A device establishment cannot market or enter into commerce some Class I, most Class II, and all Class III devices;. If the agency says “no”, trust Dr. D when he says, your CJO will know when the FDA says no!
In closing, thank you again for joining Dr. D, and I hope you find value in the guidance provided. Until the next installment of DG – cheers from Dr. D. and best wishes for continued professional success.
Code of Federal Regulation. (2014, April) Title 21 Part 820: Quality system regulation. Washington, D.C.: U.S. Government Printing Office.
Devine, C. (2011). Devine guidance for complying with the FDA’s quality system regulation –21 CFR, Part 820. Charleston, SC: Amazon.
Devine, C. (2013). Devine guidance for managing key attributes of a FDA-compliant quality management system – 21 CFR, Part 820 Compliance. Charleston, SC: Amazon.
Former Acclarent, Inc. executives charged with securities fraud and crimes related to sale and
distribution of medical devices. (2015, April). US Department of Justice. Retrieved April 17, 2015, from http://www.justice.gov/usao-ma/pr/former-acclarent-inc-executives-charged-securities-fraud-and-crimes-related-sale-and-0