The largest distributor of endoscopes in the U.S., Olympus, has settled with the U.S. Department of Justice (DOJ) for $646 million over a series of criminal and civil charges that state it rewarded and won business by making illegal payments to doctors and hospitals. In addition, the company has an ongoing compliance burden to demonstrate that it is not continuing such activities. The DOJ sees this as a systemic problem that it must continue to address within the medical device industry.
Last month, senators pointed to problems with duodenoscopes linked to superbug outbreaks and partly blamed an outdated FDA reporting system for not adequately monitoring the devices' safety. The lawmakers want to give the system a facelift, but they could face obstacles from hospitals and Medicare officials who are railing against some of the proposed changes.
Tokyo's Olympus announced that it is building a $12 million national service and distribution center in Bartlett, a suburb of Memphis, TN. It will result in the creation of 280 jobs. Construction on the 100,000 square foot facility is expected to begin in the spring.
Japan's Olympus, which has been the target of lawsuits in the United States and investigations in Europe, caught a break from the U.S. Food and Drug Administration last week when the federal regulator approved the company's duodenoscope with design changes and changes to its labeling.
The FDA has signed off on a new version of Olympus' controversial duodenoscope device, days after a cadre of lawmakers came down on the agency and the company for playing down early problems with the products that were linked to superbug outbreaks in the U.S.
Japanese medical device maker Olympus knew in early 2013 that its duodenoscopes--used by 85% of the market in the United States--could be a source of bacterial infection even after the device was cleaned, according to a U.S. Senate report this week.
Earlier this year, Olympus came under fire after its duodenoscope devices were implicated in superbug outbreaks at medical centers in the U.S. But the company's questionable practices regarding the products date further back, as Olympus played down an early report of a superbug outbreak linked to its device overseas.
The three manufacturers that market duodenoscopes in the U.S. have all been required by the FDA to submit postmarket surveillance plans to the agency within 30 days. This comes after all three received warning letters from the agency in August and an FDA committee panel took up the same issue in May.
Japan's Sony announced that what it claims is a revolutionary ultrahigh-definition endoscope system, developed since 2013 with Olympus, will reach markets in Japan and Europe next month.
Olympus and Sony are rolling out a high-definition endoscope, months after Sony--Olympus' largest shareholder--announced that it would sell off half its stake in the company amid growing scrutiny over Olympus' duodenoscope devices.