The FDA has three classes of medical devices. Class I devices, such as dental floss and surgical gloves, are considered low risk and subject to the least amount of regulatory scrutiny. At the other end of the spectrum, Class III devices pose the highest risk and are therefore subject to the highest level of regulatory review.
OtisMed misled the FDA by claiming that it was a Class I medical device that did not need to be reviewed and approved by the FDA. The company, however, should have classified OtisKnee as a Class III medical device, which would have required it to be studied and reviewed by the FDA.
Because OtisMed classified the device as a Class I medical device, the FDA did not confirm or evaluate the company’s claims regarding the safety or effectiveness of the device.
Prior to the discovery of the fraud, surgeons throughout the country used the OtisKnee cutting guide during total knee arthroplasty (TKA), which is commonly referred to as knee replacement surgery. Between May 2006 and September 2009, OtisMed sold more than 18,000 OtisKnee devices, generating revenue for the company of approximately $27.1 million.
In December 2014, OtisMed agreed to pay more than $80 million to settle criminal and civil investigations launched by the Justice Department. In a press release, the government stated, “It is vital that products like the OtisKnee are subjected to the appropriate level of scrutiny.”