Endo strikes back at medical funders in vaginal mesh cases: Reuters

Endo's vaginal mesh implants--Courtesy of Endo

Endo ($ENDP) has agreed to shell out billions to settle most of the cases claiming injuries from its vaginal mesh devices. But don't expect the company to pay inflated damages for women who were encouraged to pursue unnecessary removal surgeries, it said.

The company's American Medical Systems unit (AMS) is striking back at "a pyramid of businessmen, doctors and lawyers" who lured women into procedures to remove the implants and inflate their damages claims, it said in a West Virginia federal court filing seen by Reuters. AMS has evidence that at least four patients were pushed into getting surgeries that their own doctors did not recommend--and that funding was arranged by a lending company that worked with physicians.

The lenders, physicians and attorneys were "orchestrating the exploitation of unsophisticated medical and legal consumers and seeking to perpetuate a fraud," AMS said in its May 12 filing. Hundreds of other women may have also been coerced into the procedures, and the company should not have to pay for the surgeries, it said.

Now, AMS--which has stopped selling its implants--is trying to get court authorization to obtain more testimony from members of the alleged network, Reuters reports. A spokeswoman for Endo declined to comment to the news outlet.

The network is not owning up to any wrongdoing. Law Firm Headquarters, a Florida-based marketing company, told the news outlet that it acted in the best interests of patients who couldn't afford or access medical care.

AMS claims that Law Firm Headquarters perpetuated an "illicit enterprise" by pushing patients toward an intermediary, which then connected women with physicians who profited off removal surgeries.

But Law Firm Headquarters said that AMS is just avoiding its own liability by pointing fingers. The company's "tactics will only delay resolution of these cases, to the further detriment of those who have been injured," Abbe Lowell, an attorney for Law Firm Headquarters, told Reuters.

Endo is trying to lay its vaginal mesh saga to rest. In October 2014, the company said it would add $400 million to its $1.2 billion liability reserve to resolve "substantially all" suits over implants sold by AMS. The company will fund the payments through 2017, settling more than 10,000 suits for an average of $48,000 apiece.

"These settlements will allow us to continue to invest in the growth of our business segments and pursue accretive M&A opportunities. We believe these settlements will also allow the AMS business to continue its return to growth and enhance focus on the operations and profitability of this leading medical device franchise," Endo CEO Rajiv De Silva said at the time.

Last year, Endo said that it had "compromised and settled all claims" in about 360 cases in 12 joint motions to dismiss in a West Virginia federal court. The settlement included 30 cases with claims against other vaginal mesh makers such as Boston Scientific ($BSX) and C.R. Bard ($BCR).

- read the Reuters story

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