Medical Device Off-Label Modification: When a Sales Recipe Changes the Device

Medical device off-label modification can turn a manufacturer’s approved product into a different device through a recipe taught by its sales force. A sheet becomes a slurry. Bone products become a mixture shaped for surgery. The instructions may travel from one sales representative to another while a procedure is underway. If you work in sales, clinical support or regulatory affairs, you may know who supplied the recipe, what the company authorized and what actually reached the patient. Those connections are at the center of the Genzyme, Stryker Biotech and Norian cases.

What Is the FDA Definition of Off-Label Use?

Off-label use means using a device outside the labeling cleared or approved by the Food and Drug Administration. For a device that has been cut, dissolved or mixed with another product, the comparison also includes its physical form, composition and method of delivery. The package name is only the beginning.

The manufacturer’s part has its own evidence: who developed the mixture, who taught it, what the sales team represented and what authorization covered the changed product.

The Food and Drug Administration’s intended-use rule, effective September 1, 2021, expressly includes a product’s design or composition among the evidence of its intended use. The company’s statements and the circumstances of distribution also matter. That gives the physical product a place beside the sales presentation. In the cases below, the instructions reached beyond a discussion of what a surgeon might do. They described how to make the thing the surgeon would use.

Genzyme’s Seprafilm Became a Slurry

Genzyme admitted under its 2015 deferred prosecution agreement that preparing Seprafilm slurry transformed the approved film into a new and different Class III device whose safety and effectiveness the agency had not determined. The admitted facts in that criminal agreement explain both the physical change and the commercial reason for it.

Seprafilm was a thin film placed between tissues during open abdominal or pelvic surgery to reduce postoperative adhesions, the scar tissue that can make organs stick together. Its approved use depended on the surgeon having access through an open incision. As laparoscopic surgery became more common, the market for that approved use shrank.

The slurry made the film usable through the narrow access of laparoscopic surgery. Surgeons cut it into pieces and hydrated it with saline, producing a gel-like fluid that could pass through a catheter and trocar into the abdomen.

The company’s admitted facts put sales representatives inside that transformation. They guided surgical staff and directly participated in preparing slurry for patients. An email exchange recorded one representative advising another who was attending a procedure, followed by confirmation that the preparation had gone well. This was sales support reaching the operating table in real time.

The Written Policy and the Operating Room Told Different Stories

Genzyme’s agreement also recorded its efforts to stop slurry promotion. It trained representatives against guiding surgeons toward off-label use, later prohibited slurry discussions in the field, and eventually barred representatives from laparoscopic operating rooms. It reduced sales quotas to reflect the shrinking approved market and fired its most productive representative for promoting slurry before learning of the government’s investigation.

Yet the same admitted statement described how representatives kept guiding the preparation as part of their jobs and to help Genzyme’s sales. The policy, the quota reductions and the operating-room emails belong in the same account. A compliance presentation describes what the company told employees to do. An exchange during surgery shows what they did.

The admitted facts also addressed the literature behind a sales brochure. Genzyme acknowledged that a claim of proven benefit in radical pelvic surgery was misleading because the supporting study involved only fourteen patients. A small study had become a sweeping sales claim. For a clinical or medical-affairs employee, the study behind the approved promotional language can be as revealing as the recipe passed between representatives.

The Civil Allegation Followed the Recipe to the Hospital Claim

The Justice Department’s December 2013 civil settlement announcement says in its text that Genzyme agreed to pay $22.28 million over allegations that its slurry promotion caused false claims to federal and state health care programs. Its headline instead gives $22.38 million. The government alleged that representatives traded recipes, trained each other and taught doctors and staff how to prepare the mixture, causing hospitals and other purchasers to submit claims for uses that were not reimbursable. Two whistleblower lawsuits raised the allegations.

Patients received the altered device, and taxpayers allegedly paid for uses the government should not have covered.

Stryker Biotech’s Bone-Product Recipes

The criminal indictment against Stryker Biotech alleged that its sales effort supplied recipes for combining OP-1 products with Calstrux, a bone void filler. Surgeons, medical technicians and others allegedly received instructions to mold the untested mixtures into shapes described as cigars, tootsie rolls or Vienna sausages. The alleged sales instruction specified both the ingredients and the form the combined product would take.

OP-1 Implant and OP-1 Putty had been approved through a restrictive humanitarian device exemption. At the time, the pathway restricted the patient population and prohibited profitable sales of these products. The indictment also alleged false statements about the annual number of patients treated with OP-1 Putty.

Stryker Corporation’s February 2012 securities filing reported a corporate misdemeanor resolution, dismissal of the felony charges against Stryker Biotech and dismissal of all charges against its then-current and former employees.

Norian’s Test Market Included a Mixing Recipe

Norian’s alleged test market involved a manufacturer teaching surgeons to alter bone cement and then teaching more surgeons to use its products in the spine. The Justice Department’s June 2009 announcement of the criminal indictment described a commercial program built around an unapproved use.

According to the indictment, Synthes and Norian recruited selected surgeons to use Norian SRS in procedures for vertebral compression fractures. The company allegedly taught them to mix SRS with barium sulfate to make it more visible on X-rays, a process called back-table mixing. Those test-market surgeons were then enlisted to train other surgeons to use Norian XR for the spinal procedures.

The indictment charged that the company chose this test market instead of seeking Food and Drug Administration permission for clinical trials of the intended use. Norian XR’s cleared label expressly warned against that spinal use. The indictment also charged that the company wanted to reach the market ahead of competitors and generate published studies it could later use to persuade other surgeons.

That is an allegation about how clinical literature was to be produced and put to work. The proposed publications were part of the sales plan. The surgeons’ training, the mixing instructions and the planned studies connected the company to the use it wanted to expand.

The separate civil agreement with Synthes and Norian required Synthes to pay $138,000. It concerned allegedly false safety and effectiveness representations that caused government claims or purchases for spinal procedures involving 31 Medicare, TRICARE and Veterans Affairs beneficiaries. The government alleged that the use was not reasonable and necessary.

When a Device Change Needs FDA Review

A manufacturer’s significant change to a marketed device can require a new Food and Drug Administration submission. For a device using the 510(k) clearance pathway, this includes changes that could significantly affect safety or effectiveness, such as a different material, composition or design. A major change in intended use also requires a new submission.

For a device with premarket approval, a change affecting safety or effectiveness generally needs the agency’s approval before it is made. The manufacturer is responsible for deciding whether that review is needed. An authorized plan for future changes covers only the changes specified in that plan. The actual recipe has to fit that scope.

For an insider, the comparison is concrete. The original label describes the product and use the agency reviewed. The change assessment records what the manufacturer thought the alteration would do. A submission or authorized plan shows what change went through review. The operating-room instructions show what the sales team helped put into practice.

When the Modified Device Reaches a Government Claim

A False Claims Act case connects the manufacturer’s instruction to the clinician’s decision and the hospital or provider’s claim. In Genzyme, the government expressly alleged that teaching slurry preparation caused claims for nonreimbursable uses. In Norian, the civil allegations connected safety and effectiveness representations to government-funded spinal procedures.

Medicare generally includes implanted and inserted devices in the payment for the hospital procedure or stay. A hospital’s claim can identify a device and report its charge while the payment remains bundled. The manufacturer receives a purchase payment from the hospital. The hospital submits the healthcare claim. The payment question concerns the procedure the government paid for: Norian’s civil agreement alleged that the spinal use was not reasonable and necessary. That is why the sales instruction and the provider’s billing records need to meet in the same investigation.

A Forensic Accountant’s Guide to the Most Potent Federal Laws Used Against Healthcare Fraud, published in the Journal of Forensic and Investigative Accounting in 2020, separates false information, knowledge, influence on the government’s decision and causation in its analysis of a False Claims Act case. Applied to a device recipe, those questions connect what the company taught, what it knew about the changed product, and why the resulting claim sought money the government should not have paid.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

The Records Behind the Sales Instruction

Sales representatives and clinical specialists may know how a recipe moved from a training session into an operating room. Regulatory and quality staff may know how the same alteration was described internally. Billing and hospital purchasing staff see the procedure, the product purchased and the claim. Together, those accounts can connect a commercial instruction to a particular use and payment.

Genzyme’s admitted facts show why the comparison reaches beyond a polished slide deck. Quota decisions reflected the shrinking approved market. Training restricted slurry discussions. Emails during surgery recorded representatives helping prepare the mixture. Each document answered a different part of the question of what the company knew and what its employees did.

The sales record itself can also become part of the allegation. In a whistleblower’s complaint concerning Therakos’s promotion of its photopheresis systems for unapproved uses, the whistleblower alleged that management changed the database used by representatives:

The allegation makes the database change itself worth examining alongside the sales notes it stopped collecting. With a device recipe, the people who saw the instruction move between departments may be able to explain a connection that no single file shows.

You Know Who Supplied the Recipe

If you know how a sales instruction changed the device used in surgery, talk to our whistleblower experts about the recipe and the people behind it. We work with you to connect the manufacturer’s decisions to the clinical use and government claims, and build the strongest case those facts support. We bring in medical device fraud whistleblower lawyers who understand device authorization and federal healthcare payment, and stay with you throughout the case.