Doctors who get paid by makers of artificial implants for using their product must let patients know about it, according to a first-of-its-kind legal action by the Oregon Department of Justice.
Biotronik Inc, a German medical device company with a factory in Lake Oswego, is under Oregon Department of Justice scrutiny over payments to doctors. Here, a worker makes final inspection of a new and smaller implantable defibrillator.
Two Salem doctors, Matthew Fedor and Kyong Turk, agreed to pay $25,000 each to settle a DOJ civil case concerning pacemakers, defibrillators and related devices. DOJ continues to investigate
, Inc., the German device-maker with U.S. headquarters in Lake Oswego.
The case could ripple nationwide, exposing a little-known but common practice of payments to doctors from implant manufacturers. Locally, for instance, the practice is tolerated by the biggest hospitals in the state who do not require patients be informed of such payments. The DOJ case could do for the artificial-implant makers what similar court cases did for drug companies' payments to doctors, says
, a Harvard Medical School professor who has written about the ethics of undisclosed physician payments.
"The patient has a right to expect that whatever device is implanted or procedure is recommended is a decision that is based solely on what that patient would most benefit from," he said, calling the case "potentially so important."
Michael Crew, an attorney for the two doctors agreed the case sets a precedent, but says that's not a good thing. The case is "of questionable value" to the public interest, he said, adding that device-makers "look at this (training payments to doctors) as critically important for quality of patient care."
Secret payments, fight
The doctors, who both performed surgeries at Salem Hospital, were part of a Biotronik program to train and certify sales representatives to assist other doctors in programming and calibrating their products. Fedor and Turk "had the potential to be paid each time he selected a Biotronik device for his patients rather than another manufacturer's device," said the complaints against the doctors. The amounts paid for training weren't included in the DOJ documents.
Oregon's
requires that professionals disclose this sort of information when providing services. And by failing to, the doctors were leading the patient to believe they were free of any conflict of interest and doing the implants "for the exclusive benefit of the patient ... when this was not the case," according to the DOJ.
Fedor conducted training during implant surgery for 257 patients from 2007 to 2011. His office said he was out of the country and unable to comment. Turk trained company representatives during implants for 126 patients from 2006 to 2009, after which he retired to Hawaii. He did not respond to a request to comment.
Crew, their lawyer, says that in light of the DOJ action, Fedor, now at
, has halted the trainings and begun informing patients of conflicts, even though he did nothing wrong.
A DOJ spokesman declined to provide further details of the case, including details of the state's ongoing Biotronik investigation.
The secrecy is the result of a 15-month long Marion County Circuit Court battle between DOJ, the doctors and Biotronik. Much of the litigation has been sealed, according to public filings in the
. Settlements with the doctors and related documents were released to The Oregonian in response to a request.
Biotronik's representatives only would say they were aware of the case.
"Because Biotronik is not a party to those proceedings, or the ensuing judgement, we prefer not to comment at this time," wrote James Maldonado, the firm's corporate counsel, in an e-mail.
Aggressive growth
Biotronik is a privately owned company that focuses on implantable cardiac devices to manage heart rhythms, such as pacemakers and defibrillators. For decades it has based its U.S. operations and some manufacturing in Lake Oswego.
The firm has relied on marketing and litigation to build and protect its product, gaining steadily on its competitors, according to trade journal accounts.
Other medical device companies have been accused of
to doctors as consulting deals or research fees. And Biotronik's financial relationships with doctors have raised questions elsewhere, too. The firm's payments to doctors in Nevada led to
in sales, and triggered
, according to reports in the New York Times and elsewhere. A lawsuit in New Mexico accuses a doctor there who received payments from Biotronik of numerous unnecessary implants. The company
any improprieties.
The ethics of financial payments to doctors are muddy in Oregon, too. Locally, hospital system officials including at Legacy Health, Salem Health and Oregon Health & Science University say they do not require that patients be informed of potential financial conflicts before a procedure is done. Some of them say it's up to doctors.
-- Nick Budnick