Stryker Biotech: OP-1, Calstrux and the Charges That Were Dismissed

Stryker Corporation reported in its February 2012 Form 10-K that Stryker Biotech resolved the OP-1 criminal case with one corporate misdemeanor. The filing said the Department of Justice dismissed all thirteen felony charges against the company and every charge against its then-current and former employees. The government’s indictment had alleged that the company promoted mixing OP-1 products with Calstrux and supplied instructions for shaping the mixture. For someone who knows how device instructions travel from a manufacturer to a surgical team, the telling detail is the recipe.

OP-1 and Calstrux: The Mixing Recipes

The government’s 2009 criminal indictment alleged that Stryker Biotech promoted combining OP-1 Implant and OP-1 Putty with Calstrux, a bone void filler. It alleged that the defendants gave surgeons, medical technicians and others recipes for preparing the combination.

Some of those allegedly untested recipes called for medical personnel to mold the mixture into cigars, tootsie rolls or vienna sausages.

The Humanitarian Exemption and the Patient Counts

OP-1 Implant and OP-1 Putty had authorization from the Food and Drug Administration under a humanitarian device exemption. The conditions described in the criminal case restricted the devices to a condition affecting fewer than 4,000 patients in the United States and prohibited selling them for a profit.

The humanitarian pathway waived the ordinary requirement to demonstrate effectiveness. Its purpose was to make devices available for a limited patient population, with the authorization turning on probable benefit weighed against risk.

The indictment also charged Stryker Biotech and its former president with false statements about how many patients the company treated annually with OP-1 Putty. That allegation concerned the information supplied to FDA about a restriction attached to the authorization itself.

For an employee working with regulatory submissions, that is a recognizable comparison: the patient-use information inside the company and the numbers sent to the regulator. We work with insiders who understand both sides of that comparison.

Why the Operating Room Matters

Device representatives supply products and help surgical teams use their equipment. That industry arrangement gives preparation instructions a direct route into the operating room.

A June 2011 Senate Finance Committee staff report describes manufacturers selling implants through employees or independent sales agents. Their services include ordering and delivery, stocking and restocking, sterilization, selecting and deploying instrumentation, and assistance to surgeons in the operating room.

The hospital buys the device, while the surgeon may strongly influence which product is chosen.

The American College of Surgeons’ statement on industry representatives describes their role as education and facilitation, with the operating surgeon controlling their presence. It places medical decisions with the clinical team.

The Stryker indictment alleged that recipes reached surgeons and medical technicians. The industry setting explains why an insider’s account of those exchanges can reveal how a product was prepared and used.

For a sales or clinical employee, those are familiar business interactions. For a whistleblower case, we examine how they connect to the product used and the care billed.

Genzyme’s Recipe Reached a Civil Claims Case

In its December 2013 settlement announcement, the Justice Department alleged that Genzyme’s instructions to dissolve Seprafilm into slurry for laparoscopic procedures caused nonreimbursable claims.

What Evidence Is Needed to Prove Fraud?

We work with the insider to assess which evidence connects product instructions, clinical use and government billing in a medical device False Claims Act case. The sales employee, regulatory specialist and hospital billing team may each see a different part of that story.

The Journal of Forensic and Investigative Accounting’s 2020 article on healthcare fraud laws puts the payment request at the center of its analysis. It examines whether a false statement helped induce the payment. Applied to a device case, that directs attention through the sales conversation to the provider’s bill.

The payment structure matters too. Medicare usually includes an implanted device in the payment for the procedure. A manufacturer’s sale, the surgeon’s product choice and the hospital’s payment claim are separate parts of the same commercial chain. Our work is to connect the conduct an insider saw to the claim and the reason it was false.

A sales employee may know who circulated a preparation instruction. A regulatory employee may understand the patient-use information behind an FDA submission. Someone working on reimbursement may understand the claims that followed. We assess those perspectives together, with medical device whistleblower lawyers who understand promotion and provider billing.

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

You Know How the Instructions Reached the Surgical Team

If you know who promoted a device mixture or how the company’s FDA reports compared with actual use, speak with our whistleblower experts. We build the case with you, connect the manufacturer’s decisions to the provider’s claims and bring in medical device whistleblower lawyers who know these promotion cases. We stay beside you as your knowledge becomes the foundation of the case.