Stryker ($SYK) has agreed to shell out at least $4.38 billion to settle more than 4,000 lawsuits alleging the medical device giant sold faulty metal hip implants that hurt patients.
Stryker attorney Kim Catullo told a New Jersey judge on Monday the company will pay a base amount of $300,000 to each patient who had the devices surgically removed due to complications, Bloomberg News reported. Patients who underwent multiple surgeries due to the device could be awarded more compensation for their injuries, subject to certain conditions, attorneys said.
The Kalamazoo, MI-based company voluntarily recalled its Rejuvenate and ABG II metal hip implants in 2012 after higher-than-normal reports of problems surfaced. Patients complained of pain, swelling and tissue damage shortly after being implanted with the devices. When the recall was announced, the number of lawsuits swelled, triggering the consolidation of cases by a state court in New Jersey and a federal court in Minnesota.
"The health and well-being of patients is Stryker's top priority," Bill Huffnagle, president of the company's reconstructive division, said in a statement posted to a website that announced the settlement agreement. "Following our voluntary recall and our patient support program for recall related care, this Settlement Program provides patients compensation in a fair, timely and efficient manner."
The settlement comes after months of mediation and before any cases went to trial. As of the end of 2013, the recall effort cost the company $700 million in charges.
Stryker is not the only medical device company to face lawsuits alleging it made faulty metal hip implants. Johnson & Johnson's ($JNJ) DePuy arm is dealing with thousands of lawsuits over its now-recalled ASR-implants. The company made a $2.5 billion-plus settlement to resolve 8,000 of them last year, and was reported in October to be considering a $250 million settlement to resolve additional cases not covered in the prior agreement. Biomet is also dealing with hundreds of metal hip lawsuits.