Stryker Hip Lawsuit Settlement Funding
Pre Settlement Funding on Stryker Hip Recall Litigation
After two warnings issued by the Food and Drug Administration (FDA) and an increasing number of people who filed lawsuits against Stryker Homedica Osteonics, Stryker finally recalled two components for the Trident Hip Replacement last January 2008: the Trident Acetabular PSL Cup and the Trident Hemispherical Cups. Stryker said products are used for the socket portion of the hip implant but the FDA found that these products do not meet appropriate standards of sterility.
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The Need for Hip Implants
Hip replacement surgery is a very common orthopedic procedure. This can be performed as a total replacement or a half replacement. It involves components of the hip joint and the prosthetic / synthetic implant. People who are candidates for hip replacement surgery typically have one or more of the following conditions:
Traumatic arthritis (from serious fractures or injuries that cause damage to the articular cartilage)
Rheumatoid arthritis (often hereditary and causes inflammation of the synovial membrane)
Osteoarthritis (degenerative joint disease causing bone-on-bone movement, pain and stiffness)
Prompted by numerous complaints from patients, the FDA sent a first warning letter to Stryker on March 15, 2007 which cited several violations at the Ireland plant, including failure to meet deadlines about following procedures for testing defective products and documenting risk.
FDA Warnings About Stryker
According to the FDA, “This inspection revealed that these devices are adulterated within the meaning of section 501(h) of the Act (21 U.S.C. § 351(h)), in that the methods used in, or the facilities or controls used for, their manufacture, packing, storage, or installation are not in conformity with the Current Good Manufacturing Practice (CGMP) requirements of the Quality System (QS) regulation.”
Stryker Hip Replacement Recall
On November 28, 2007 a second warning letter was sent to Stryker which stated that a range of deficiencies have been detected, including Staphylococcus bacteria, the pathogen that causes staph infections and complaints from patients about squeaking ceramic-to-ceramic hip joints.
Under pressure from the FDA, Stryker issued a recall for two of its hip implant components in January 2008 wherein it stated “As a result of the deviation from internal specifications, the Company is initiating a voluntary recall of Trident PSL and Hemispherical Acetabular Cups manufactured in its Cork facility.”
All-metal implants were, at one point, one third of all hip replacements. However, there has been a significant decline in the demand and sales of these all-metal devices due to metal debris that damages tissues and muscles of the patients.
Stryker was initially unaffected by this significant decline. In fact, the company had increased sales because patients were opting to veer away from metal-on-metal devices. However, it was later found that the Stryker hip implants also had the same risks and complications as all-metal products because of the titanium alloy and cobalt chromium components of the medical devices.
Ever since the studies and data have shown adverse complications from the use of the Stryker Rejuvenate and ABG II Modular-Neck Hip Systems, Stryker also started receiving lawsuits from patients that suffered metal poisoning and/or severe pain that could only be resolved through revision surgery.
The company has promised patients and doctors about the benefits of the product — that it will not corrode or be subject to fretting. However, studies had also shown that these product claims from the manufacturer have proven to be untrue.
Stryker has thousands of lawsuits against them that are pending. This includes their ongoing multidistrict litigation in Minnesota and multicounty litigation in New Jersey. The company has set aside approximately $1.4 billion to settle these two litigations, along with other coming lawsuits. The estimated value is also expected to exceed the given figure due to more lawsuits that are incoming.
These lawsuits are swirling around the Rejuvenate Modular-Neck Hip System and the ABG II Modular-Neck Hip System with claims of faulty design, negligence, concealment of safety information and risks associated with the products. Plaintiffs are asking for compensation for medical expenses as well as pain and suffering, lost wages, and where applicable cases are affected, punitive damages, among many other claims.
Stryker Lawsuits and Litigation
When Stryker proceeded with its regulatory filing in October 2013, it was suggested that the company already expected a hefty amount of claims. Initially, the manufacturer expected to spend somewhere between $700 million and $1.13 billion. This amount did not include third-party insurance, litigation and other costs that were associated with the two recalled hip devices. In the same filing, Stryker stated that the basis for the initial amount is on the number and actual costs of patients seeking testing and treatment services, patients requiring revision surgeries, amount of third party insurance recoveries, and the number and actual costs to settle the lawsuits filed against the company.
As reported by The New York Times, in November 2014, Stryker announced that it had reserved $1.45 billion to settle claims with patients that were allegedly injured by the manufacturer’s implant systems, but are expecting the final costs to be much higher than the stated amount.
The settlement is intended to cover for patients that received the Rejuvenate Modular-Neck of the ABG II Modular-Neck devices, as well as patients that had to undergo revision surgery to correct complications that were a result of the faulty devices.
Under the same settlement, Stryker said that a base payment of $300,000 will be given to patients that received either one of the hip systems that had to go through revision surgery to remove and/or replace the devices by November 3, 2014. Of course, the base will vary per patient depending on the extent of damage of the complications that were a result of revision surgery, among other factors.
Patients who plan to file claims against the company may do so under the established settlement until March 2nd of 2015. The first payouts of the settlement are expected to occur in 2015. The billion dollar settlement also covers the New Jersey multicountry litigation and the Minnesota multidistrict litigation.
Plaintiffs are charging Stryker with claims that the Rejuvenate and ABG II models since its modular neck is susceptible to fretting, degradation, and fracture. Allegations in these lawsuits also include Stryker’s responsibility — that they knew or should have known that the devices were not safe for patients but still opted to pursue marketing and sales activities of the products.
In the lawsuits, patients are seeking compensation for pain and suffering, medical expenses inclusive of revision or replacement surgery, lost past and future wages, punitive damages, loss of consortium and other compensatory damages depending on the case of each plaintiff.
Other lawsuits also claim that the company misrepresented the devices regarding its promises (i.e. corrosion and fretting), was negligent in the design and safety testing of the devices, used deceptive sales and marketing activities, gave false claims regarding the device as a safe alternative to metal-on-metal devices, failed to respond to early failure reports, continued to sell the devices all the while knowing that the components had poor performance with each other, and failed to warn the public (or at least patients and medical surgeons) about that metal poisoning side effect of the devices.
Because of the large amount of lawsuits Stryker is currently facing, the multitude of lawsuits have been consolidated into different litigations in different states to further quicken the closing of these lawsuits due to the similar cases filed against the same defendant.
New Jersey Superior Court Judge Brian Martinotti is overseeing the multicounty litigation in the said state for over 2,000 cases of lawsuits against the company. The first lawsuit filed within this litigation was by Ellen Relkin in August 2012 of Weitz & Luxenberg.
Judge Martinotti ordered the first phase of mediation for the MCL in late 2013 in the Bergen County of New Jersey. Eight of the ten cases that were scheduled to go through the mediation process in December 2013 and January 2014 were settled with undisclosed amounts. The court, and the counsels of both plaintiffs and defendants were ordered to select cases for a second phase of mediation.
On the other hand, the multidistrict litigation in Minnesota has almost 1,700 lawsuits, presided by U.S. District Judge Donovan W. Frank. The litigation includes cases regarding the Rejuvenate and ABG II hip devices in spite of Stryker’s opposition, while the same litigation is expected to grow further.
Background on Stryker
Stryker Corporation is a Michigan-based, multibillion dollar company that markets 57,000 products around the world. The company garnered more than $8 billion in annual sales for the year of 2012. The subsidiary controls almost one fourth of the United States hip and knee implant market. When the controversy regarding all-metal hip implant devices plummeted sales for its competitors, Stryker’s market share increased since its products are not all-metal.
Stryker became a global competitor because of its innovative product line. What started as a new kind of hospital bed transitioned into cast cutters to hip implants, among many others.
Stryker Corporation became a major player in orthopaedics through its many acquisitions of many other corporations like Osteonics Corporation and Howmedica. The company is now the second highest and largest seller of orthopaedic medical devices.
Its subsidiary, Stryker Orthopaedics was created in 1998. It was ranked as one of the top 15 most profitable orthopaedic and spine device companies in the world by 2011.
Stryker Hip Replacement Systems
The Rejuvenate Hip System was out on the market in 2009, and the ABG II Hip System was sold a year later. The two products were marketed as the “next generation” and “latest evolution” in the hip replacement product category. Stryker’s metal-on-metal hip systems differ from those in the market in terms of its parts. While most hip implants have one-piece neck and stem systems, and a cup, the Stryker hip implants boast of its multiple neck and stem components that give surgeons more options to better suit the needs of each patient.
The two Stryker devices are not exactly considered as metal-on-metal devices because of the lack of a metal ball the rubs against a metal socket. But because the Rejuvenate and ABG II necks are also made of chromium and cobalt, and the stems are coated with titanium, the devices still have metal-on-metal junction that also has the tendency to release metal particles into the bloodstream and surrounding tissue.
The stems of the Rejuvenate and ABG II models are made of the titanium alloy, which is a mix of titanium, molybdenum, zirconium, and iron. Stryker claims that the titanium alloy prevented corrosion and fretting, saying that the alloy is closely resemblant of the bone and that their patented alloy is 20% stronger than other titanium alloys. However, data has shown that these claims are found to be untrue.
The Rejuvenate Modular-Neck Hip Systems have six stems and sixteen necks. The product was marketed to younger patients with the promise of longer-lasting devices with improved range of motion. On the other hand, the ABG II Modular-Neck System has eight right stems, eight left stems, and ten modular necks that were supposedly designed to give greater stability and minimal bone stress on patients.
Complications of the Stryker Hip Stems are the same as the common problems associated with metal-on-metal devices, such as metallosis, necrosis, osteolysis, pseudotumors and severe pain that would require revision surgery.
FDA Recalls, Warnings and Reports
Because the company did not conduct any form of testing on the safety and effectiveness of the two device before actually selling them, Stryker recalled the Rejuvenate Modular-Neck and the ABG II Modular-Neck in 2012. A factor in the recall was also the fact that the FDA obtained over 60 adverse event reports regarding metal toxicity that required revision surgery. The recall of the Rejuvenate and ABG II products was done in the United States, and the company also stopped sales and production of the devices in the rest of the world.
What’s notable about Stryker is their initiative to send out safety alerts and recommend proper action for patients. The company recommended that patients who were already implanted with modular-neck hip implant systems and were experiencing constant pain should go through medical evaluations such as X-rays, MRIs and blood tests, to check whether they have detrimental levels of metal ions.
Medical professionals have inferred that Adverse Local Tissue Reaction would generally necessitate operative intervention, and revision surgery with the use of ceramic-on-metal modular junction replacement as a highly recommended resolution. Revision surgery is not as easy as it may sound. It can cause trauma for the patient, and the procedure is very difficult for any surgeon to perform since revision surgeries pose the risk of femur fracture during the operation.
Three months prior to the recalls, the company had issued an Urgent Safety Alert to surgeons in April 2012 for the two hip implant systems. The safety alert was intended for surgeons and stated safety risks to patients regarding exorbitant amounts of metal debris and/or ion generation.
Stryker, in the same memo, also mentioned other complications that can result from the use of their implants, which are identical to other reported complications from various brands of devices such as metallosis, necrosis, osteolysis, and pain and loosening of the implanted device.
Postmarket data showed evidence of corrosion and fretting after the implantation of the devices, thus proving the company’s claims were false. The postmarket data and perseverance of the company’s postmarket surveillance studies were also factors in the device systems’ recall.
Stryker’s Rejuvenate and ABG II devices were not the only products of the manufacturer to be recalled. The Accolade TMZF Plus Hip Stem was also recalled in 2009, 2011, and again in 2013 for errors in packaging and manufacturing. Accolade is similar to Rejuvenate and ABG II in such a way that they all have the patented titanium alloy, named TMZF. The former product has a PureFix HA coating, which is designed to help bone growth around the implant.
Other Stryker products that have been recalled include Trident Acetabular PSL and Trident Hemispherical cups, which were manufactured in an Ireland facility. The Accolade Femoral Stem was also recalled in April 2012 because of high revision surgery rates.
The FDA’s 510(k) approval system has been evidently the cause of a lot of recalls and troubles for medical device manufacturers. The system basically approves a product that is substantially similar to an already approved product in the market, without having to go through clinical trials.
It may have been deemed more efficient for the institution, but have also shown the flaws of this program. Stryker is no stranger to the approval system whereas both the Rejuvenate and ABG II systems were approved due to this program. Because these products easily swifted through the approval process, Stryker only needed to worry about conducting the required postmarket surveillance studies.
Some studies have also found associations between the absorbed metal ions and neurological and heart problems, along with other damages to the lymph nodes, spleen, liver and kidneys.
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