July 24, 2008
By BARRY MEIER
Zimmer Holdings, the nation’s biggest producer of orthopedic devices,
says it will suspend sales of an artificial hip component that some
doctors have complained was failing at a high rate.
The company also lowered its earnings outlook as a result of the
suspension, and its shares fell sharply Wednesday.
In recent months, some doctors have complained that the device, a hip
socket known as the Durom cup, was failing in their patients, who then
had to undergo replacement surgery.
Zimmer said its investigation had determined that the product was not
defective. But it stated that even some experienced surgeons had found
it difficult to implant. The company said it expected to resume sales
once specialized training for doctors had begun.
Since it was first sold in the United States in 2006, the Durom cup has
been implanted in more than 12,000 patients. Zimmer said it expected
the overall need for early replacement in patients would be low. But
Zimmer data and interviews with doctors suggest that hundreds of
patients might need such procedures in coming years.
Some doctors said their patients had not had problems with the cup.
The company also said the sales halt would cut $20 million to $30
million from its sales estimates. Zimmer said it expected that earnings
for the year would be $4.05 to $4.10 a share, down from its earlier
forecast of $4.20 to $4.25 a share.
In composite trading on the New York Stock Exchange, shares of
Zimmer, which is based in Warsaw, Ind., fell $4.87 a share to close at
$66.01 a share. Bruce Nudell, an analyst at UBS who covers medical
devices, said that the company had not issued any warnings that sales
would be halted.
Complaints Undermine Hip Device - NYTimes.com Page 1 of 2
http://www.nytimes.com/2008/07/24/business/24hip.html?_r=1&oref=slogin&pagewanted... 7/24/2008
“They had given hints that there would not be a recall but this came as
a surprise,” Mr. Nudell said.
No comments:
Post a Comment