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Joseph H. Saunders
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Guidant Officials Worried About Device Defects

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When Guidant Corp. came under fire last year for not revealing to doctors it’s problems with its medical device, it remained positive in its public announcements. But newly released documents show that, inside Indianapolis-based Guidant, executives were struggling to contain a mounting crisis.
The records illustrate how a series of miscalculations by Guidant, like its misreading of doctors’ tolerance for being kept in the dark, as well as its initial decision not to recall devices, put the company on the defensive. As a result, company executives repeatedly changed course.

In a voice message to sales personnel on June 8, for example, R. Frederick McCoy Jr., the head of Guidant’s cardiac device unit, said he realized after speaking to doctors that Guidant’s initial decision not to provide free replacement devices “was not in the best interest of the company,” according to a transcript. The documents are part of a product-liability lawsuit against the company.
Early on, senior executives warned one another that scrutiny of Guidant might intensify if doctors or others started looking into a public database that showed product failures. And the documents show that sales representatives expressed alarm that some doctors were challenging Guidant’s ethics and had stopped implanting its devices.
Guidant executives, then and now, have defended their decision not to publicize certain device defects, arguing that to have done so would have exposed patients to the greater risks posed by replacement surgery. But some company executives quickly realized that to win back the trust of their customers — doctors — they had to change the way they disclosed problems, the records show.
Some physicians were particularly upset that Guidant had sold potentially flawed units out of inventory, rather than pulling them back so the units would not be implanted.
“I am not critical of Guidant’s device problems — these devices are so complex, issues are expected,” wrote one physician, Dr. Brian D. Jaffe of Traverse City, Mich., in a letter last July that was included in the court documents. “I will not, however, work with a company that put profit and image in front of good patient care and honesty in device manufacturing.”
The newly disclosed records, which come from the files of McCoy, could add to the company’s legal problems as it defends itself against allegations that it put patients at risk by not publicizing defects. At least seven patients have died in connection with short circuits in three models of Guidant defibrillators.
The documents also underscore the scope of the reclamation project facing Boston Scientific, which in January outbid Johnson & Johnson and agreed to buy Guidant for $27 billion.
To make the acquisition succeed, Guidant must rebuild its reputation with physicians and its battered market share. In late 2004, Guidant had about 35 percent of the heart device market; today, its share is hovering around 24 percent, according to analysts’ estimates.
A spokesman for Boston Scientific declined to comment Monday.
A spokesman for Guidant, Steven Tragash, said the company does not comment on matters related to ongoing litigation. The company has said that it did nothing wrong. On Thursday, Guidant dropped its claim of confidentiality to records produced in connection with a recent pretrial deposition of McCoy as part of a lawsuit in Texas.
The New York Times has filed a motion in the case, which is pending in state court in Corpus Christi, seeking the release of records related to public safety.
The Texas case is one of some 145 filed against the company since last year when Guidant recalled more than 100,000 implantable heart devices, including the three models tied to patient deaths. The company is also under investigation by the Department of Justice and the Food and Drug Administration.
The company’s crisis started last May after two doctors in Minneapolis, Dr. Robert G. Hauser and Dr. Barry J. Maron, learned from Guidant executives that an electrical flaw in a company defibrillator had played a role in the death two months earlier of a college student who was their patient.
They urged the company to alert doctors about the potential of the device, the Prizm 2 DR, to short-circuit. When Guidant hesitated, they contacted some other doctors and The Times.
After The Times published an article last May saying that Guidant had not told doctors for three years about the flaw, the FDA opened an investigation.
McCoy led the company’s response. He struck an upbeat rallying tone in many of his messages. After The Times article about the Prizm 2 DR appeared, McCoy jotted on a note pad: “Positive proactive visible,” summing up the company’s strategy. In another note, dismissing the controversy, he wrote, “Nobody calling our decision and action into question.”
But even as Guidant was assuring doctors that it did not plan to recall the device, executives inside the company were less sanguine.
On June 2, for example, Dr. Beverly H. Lorell, Guidant’s chief medical officer, sent an e-mail message to McCoy about other company devices that might attract outside scrutiny. Some data about them, she noted, were in a public FDA database.
“Parts of the data for each of the three trends are in public domain and thus amenable to further external scrutiny and discussion,” Lorell wrote. “It is possible that physicians and others may pull on these threads in the near future.”
As those threads began to unravel, executives like McCoy soon found themselves backtracking. With the FDA investigating, Guidant reversed course on the Prizm 2 DR, issuing an alert on June 17 about that device as well as two other defibrillators that also had repeatedly short-circuited, the Contak Renewal 1 and Contak Renewal 2.
Strikingly, some Guidant executives realized early, according to records, that the crisis might be contained if the company overhauled its disclosure practices and provided doctors with more detailed failure data.
But a draft news release, dated June 3, shows that Guidant planned to combine the announcement of such a policy change with a marketing initiative to promote a new product. The release apparently never went out, and five months passed before Guidant issued its new and detailed report on product failures.