
Medtronic manufactures, among other things, various spinal devices, and spared no expense in bribing neurosurgeons to use its products in spinal surgery cases. The suit alleges that neurosurgeons such as Jeffrey Wang, now director of the Universityof California at Los Angeles's Comprehensive Spine Center, were taken to Memphis’s Platinum Plus strip club, which was eventually shut down because it ran a whore-house. Dr. Wang denies such trips.
Another surgeon named in the suit is Hallett Mathews. According to a former Medtronic attorney, Dr. Mathews was paid $450,000 a year under a sham“consulting agreement.” Apparently, Dr. Mathews brought so much money into the company by using its spinal devices that he was given a Medtronic credit card. Bribery is much easier when you cut out the middle man.
Then there were the Alaskan “think tank” trips. Here’s how these are alleged to have worked. First, Memphis neurosurgeon Maurice Smith was given a pre-paid 10 year “consulting” contract. His job duties had little to do with helping patients, however. Instead, he specialized in planning annual all-expenses-paid trips to Alaska. The doctors were supposed to present case studies during the trips but evidently they were too busy enjoying themselves to bother with such niceties. According the Journal:
Ms. Kelley [the former Medtronic attorney] alleges Medtronic sent physicians on lavish trips under the guise of medical conferences, but where little work was done. Her complaint claims that on a five-day, all-expenses-paid trip to Alaska in 2001, which was billed as a "think tank," doctors were supposed to present case studies. But, according to the complaint, little discussion of the case studies took place. One doctor scheduled to give a talk stood before the group, "said he was sorry, but he had not prepared anything," and "drinking then commenced in place of discussion," Ms. Kelley said in the suit. Medtronic picked up the cost of fishing guides and clothing for the doctors, the suit said. It said "women were also provided for the doctors," but didn't elaborate.
Evidently, spinal surgeons were partial to New Orleans, and Medtronic was happy to let the good times roll during Mardi Gras:
At a Medtronic-sponsored "discussion group" in New Orleans, according to the complaint, the company paid $20,000 to $25,000 to get a group of doctors on a Mardi Gras parade float and another $15,000 to supply doctors with Mardi Gras beads.
In this embarrassing statement responding to the article, Medtronic begins by scolding the Wall Street Journal for reporting the allegations, which were supposed to have remained hidden from the public in a “sealed” lawsuit. Then, they refuse to admit any wrongdoing, saying only that “allegations of inappropriate business practices described in the article are said to have occurred years ago.” Then, they assure us that “the company has put more rigorous systems and processes in place to assure alignment with these standards, identify any break from standards, and address behavior that is in violation.” But if they had done nothing wrong, why did they have to beef up their internal reviews? They don’t get around to answering this question in their statement.