The Marketplace Report: Faulty Heart Defibrillators

Alex Chadwick talks to John Dimsdale of Marketplace about a New York Times report suggesting that medical device maker Guidant knowingly sold faulty heart defibrillators.

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ALEX CHADWICK, host:

Back now with DAY TO DAY. I'm Alex Chadwick.

One of the nation's leading makers of medical equipment, the Guidant Corporation, continued selling a popular heart defibrillator even after an electrical flaw had be identified in the device. That news, first reported in this morning's New York Times, has gotten the attention of regulators at the Food and Drug Administration. From the "Marketplace" Washington bureau, we're joined by John Dimsdale of "Marketplace."

John, what is the company saying about these defibrillators?

JOHN DIMSDALE ("Marketplace"): They discovered back in 2002 that these small devices that are implanted under the skin were somewhat prone to short-circuit. These defibrillators are battery-powered electrical devices that send a small shock to the heart when it's beating abnormally to bring it back into rhythm. In a small number of cases--26 out of 37,000 total devices before 2002--a short circuit could cause Guidant's defibrillator to fail.

CHADWICK: So that's a failure rate of less than one in a thousand, but these are devices that are supposed to keep you alive. So what did the company do when they discovered the flaw?

DIMSDALE: They fixed it. The separated the two parts that were short-circuiting, and they added some insulation. But it turns out the company continued to sell the old flawed devices even as they were putting the fixed ones into circulation.

CHADWICK: And how did this information come out?

DIMSDALE: Recently, a patient with one of the old defibrillators died. Doctors discovered that the young man had one of the old devices, and sure enough, it had short-circuited, causing his death. Confronted with the evidence, the company released a statement, saying, `Yes, we sold our products manufactured before the improvements, because the old devices remained a highly reliable life-saving product.'

CHADWICK: Not quite so reliable as the new devices, though, I guess. Is there any suggestion at the FDA that this may be illegal?

DIMSDALE: Well, they've started to investigate how the company handled the repairs. Guidant says all of this was revealed in the company's annual report to the FDA, filed in August of 2003, but for some reason, it didn't register with anyone that the company was continuing to sell the old devices even after they had identified and fixed this flaw.

CHADWICK: And who else might be at risk, John? And if you're packing one of these things, what should you do?

DIMSDALE: Yeah, there are still an estimated 24,000 people using the old units, but Guidant is advising doctors not to replace them, because the risks posed by the surgery that's needed to take out the old one and put in a new one outweigh the risks of a short circuit.

CHADWICK: All right, John. Well, thanks very much. What else coming up today on "Marketplace"?

DIMSDALE: Well, we're going to be looking at the big changes that are in store for the regulators at the Securities and Exchange Commission.

CHADWICK: Well, those are under way. Thanks you very much, John Dimsdale of public radio's daily business show "Marketplace," produced by American Public Media.

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