Synthes
Encyclopedia
Synthes Holding AG is a multinational
medical device
manufacturer based in Solothurn
, Switzerland
and West Chester
, Pennsylvania
, United States
. It is the world's largest maker of implants
to mend bone fracture
s, and also produces surgical
power tool
s and advanced biomaterial
s. Synthes is controlled by chairman
, former CEO
and largest shareholder Hansjörg Wyss
, who is ranked 121st on the 2010 Forbes
list of richest people in the world. The company's shares are listed on the SIX Swiss Exchange and the firm is a constituent of the SMI index
.
of the non-profit
institute Arbeitsgemeinschaft für Osteosynthesefragen
(Association for the Study of Internal Fixation, AO/ASIF), which was applied to internal fixation implants produced under licence
by its industrial partners, Straumann Group
and Mathys Medizinaltechnik. In 1975 Synthes USA, a firm founded by Harvard
graduate Hansjörg Wyss, became the third company to form an alliance with AO/ASIF, while Straumann and Mathys expanded their coverage around the rest of the world throughout the decade.
In 1990 Straumann spun off
its implant business into a separate privately owned company, Stratec Medical. Stratec partially listed its shares on the SWX Swiss Exchange
through an initial public offering
six years later, while Synthes USA and Mathys remained in private hands. Three years later, however, Stratec and Synthes USA merged
to form a new publicly-traded company
named Synthes-Stratec. After the merger Hansjörg Wyss became, and remains today, the majority shareholder
of the enlarged company. The third of the original AO/ASIF partner companies, Mathys, sold its osteosynthesis department to Synthes-Stratec in 2004, although the firm's German
division was divested
to satisfy competition authorities. The company subsequently dropped the "-Stratec" suffix
to become simply Synthes. The company's shares were added to the benchmark Swiss Market Index
for the first time in September 2004.
In 2006 the company acquired the rights to the Synthes brand name and most of the related intellectual property
, including patent
s, from the AO/ASIF foundation for around CHF
1 billion. AO also acquired a stake in Synthes. The two organisations continue to collaborate on relevant issues.
In October 2010, Synthes and its subsidiary Norian both pled guilty to crimes relating to illegally implanting bone cement without FDA approval. Norian will admit to a felony charge of conspiracy to impede FDA functions and pay a $23 million dollar fine. Synthes will then divest Norian.
In November 2010, Synthes acquired USA based privately owned surgical tools maker The Anspach Effort, Inc, purchase price was not disclosed.
On April 27, 2011 Synthes and Johnson and Johnson agreed to a merger deal. The merger will create the world's largest orthopedic corporation.
and related instruments for the treatment of physical trauma
, spinal injuries
and CMF (craniomaxillofacial
) trauma, as well as for osteotomy
in animals such as horse
s and dog
s. Synthes' other business segments are the production of surgical
power tool
s and biomaterial
s used to fill bone defects.
The indictment charges Synthes Inc. with a total of 52 felony counts: conspiracy to impair and impede the lawful functions of the FDA and to commit crimes against the US; 7 counts of making false statements in connection with an FDA inspection; and 44 counts of shipping adulterated and misbranded Norian XR in interstate commerce with intent to defraud.
The parent company, Synthes, is charged with 44 misdemeanor counts of shipping adulterated and misbranded Norian XR in interstate commerce, and the four executives, Michael D. Huggins, Thomas B. Higgins, Richard E. Bohner and John J. Walsh, are each charged with one misdemeanor count of shipping adulterated and misbranded Norian XR in interstate commerce. Synthes Inc. acquired N Spine Inc. in 2007.
According to a copy of the indictment, obtained by MM&M, from May 2002 until fall 2004 Norian conspired with others, including Synthes and the four named executives, to conduct unauthorized clinical trials of Synthes's medical devices, Norian XR and Norian SRS, in surgeries to treat vertebral compression fractures of the spine (VCFs), a painful condition commonly suffered by elderly individuals.
These surgeries were allegedly performed despite a warning on the FDA-cleared label for Norian XR against this use, and in the face of serious medical concerns about the safety of the devices when used in the spine.
According to the indictment, before the marketing program began, pilot studies showed the company that the bone cement reacted chemically with human blood in a test tube to cause blood clots. The research also showed, in a pig, that such Norian-caused clots became lodged in the lungs. Notwithstanding this knowledge, the company allegedly proceeded to market the product for VCFs without putting it through FDA-required testing. The company, it is alleged, did not stop marketing the product until after a third patient had died on the operating table.
Multinational corporation
A multi national corporation or enterprise , is a corporation or an enterprise that manages production or delivers services in more than one country. It can also be referred to as an international corporation...
medical device
Medical device
A medical device is a product which is used for medical purposes in patients, in diagnosis, therapy or surgery . Whereas medicinal products achieve their principal action by pharmacological, metabolic or immunological means. Medical devices act by other means like physical, mechanical, thermal,...
manufacturer based in Solothurn
Solothurn
The city of Solothurn is the capital of the Canton of Solothurn in Switzerland. The city also comprises the only municipality of the district of the same name.-Pre-roman settlement:...
, Switzerland
Switzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
and West Chester
West Chester, Pennsylvania
The Borough of West Chester is the county seat of Chester County, Pennsylvania, United States. The population was 18,461 at the 2010 census.Valley Forge, the Brandywine Battlefield, Longwood Gardens, Marsh Creek State Park, and other historical attractions are near West Chester...
, Pennsylvania
Pennsylvania
The Commonwealth of Pennsylvania is a U.S. state that is located in the Northeastern and Mid-Atlantic regions of the United States. The state borders Delaware and Maryland to the south, West Virginia to the southwest, Ohio to the west, New York and Ontario, Canada, to the north, and New Jersey to...
, United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
. It is the world's largest maker of implants
Implant (medicine)
An implant is a medical device manufactured to replace a missing biological structure, support a damaged biological structure, or enhance an existing biological structure. Medical implants are man-made devices, in contrast to a transplant, which is a transplanted biomedical tissue...
to mend bone fracture
Bone fracture
A bone fracture is a medical condition in which there is a break in the continuity of the bone...
s, and also produces surgical
Surgery
Surgery is an ancient medical specialty that uses operative manual and instrumental techniques on a patient to investigate and/or treat a pathological condition such as disease or injury, or to help improve bodily function or appearance.An act of performing surgery may be called a surgical...
power tool
Power tool
A power tool is a tool that is actuated by an additional power source and mechanism other than the solely manual labour used with hand tools. The most common types of power tools use electric motors. Internal combustion engines and compressed air are also commonly used...
s and advanced biomaterial
Biomaterial
A biomaterial is any matter, surface, or construct that interacts with biological systems. The development of biomaterials, as a science, is about fifty years old. The study of biomaterials is called biomaterials science. It has experienced steady and strong growth over its history, with many...
s. Synthes is controlled by chairman
Chair (official)
The chairman is the highest officer of an organized group such as a board, committee, or deliberative assembly. The person holding the office is typically elected or appointed by the members of the group. The chairman presides over meetings of the assembled group and conducts its business in an...
, former CEO
Chief executive officer
A chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
and largest shareholder Hansjörg Wyss
Hansjörg Wyss
Hansjörg Wyss is a Swiss entrepreneur and businessman. As of 2008, Wyss ranks #164 on the Forbes list of billionaires, with a net worth of approximately $6 billion, making him the second richest person in Switzerland.-Life and career:...
, who is ranked 121st on the 2010 Forbes
Forbes
Forbes is an American publishing and media company. Its flagship publication, the Forbes magazine, is published biweekly. Its primary competitors in the national business magazine category are Fortune, which is also published biweekly, and Business Week...
list of richest people in the world. The company's shares are listed on the SIX Swiss Exchange and the firm is a constituent of the SMI index
Swiss Market Index
The Swiss Market Index is Switzerland's blue-chip stock market index, which makes it the most important in the country. It is made up of twenty of the largest and most liquid SPI large- and mid-cap stocks...
.
History
Synthes was originally established in 1960 as a trademarkTrademark
A trademark, trade mark, or trade-mark is a distinctive sign or indicator used by an individual, business organization, or other legal entity to identify that the products or services to consumers with which the trademark appears originate from a unique source, and to distinguish its products or...
of the non-profit
Non-profit organization
Nonprofit organization is neither a legal nor technical definition but generally refers to an organization that uses surplus revenues to achieve its goals, rather than distributing them as profit or dividends...
institute Arbeitsgemeinschaft für Osteosynthesefragen
Arbeitsgemeinschaft für Osteosynthesefragen
Arbeitsgemeinschaft für Osteosynthesefragen , also AO Foundation, commonly called AO is a non profit organization dedicated to improving the care of patients with musculoskeletal injuries and their sequelae through research, development, education and quality assurance in the principles, practice,...
(Association for the Study of Internal Fixation, AO/ASIF), which was applied to internal fixation implants produced under licence
License
The verb license or grant licence means to give permission. The noun license or licence refers to that permission as well as to the document recording that permission.A license may be granted by a party to another party as an element of an agreement...
by its industrial partners, Straumann Group
Straumann
Headquartered in Basel, Switzerland, the Straumann Group acts in implant and restorative dentistry and oral tissue regeneration.Recently, Straumann entered the fast-growing field of restorative dentistry through the acquisition of etkon, an emerging force in CAD/CAM based tooth replacement...
and Mathys Medizinaltechnik. In 1975 Synthes USA, a firm founded by Harvard
Harvard University
Harvard University is a private Ivy League university located in Cambridge, Massachusetts, United States, established in 1636 by the Massachusetts legislature. Harvard is the oldest institution of higher learning in the United States and the first corporation chartered in the country...
graduate Hansjörg Wyss, became the third company to form an alliance with AO/ASIF, while Straumann and Mathys expanded their coverage around the rest of the world throughout the decade.
In 1990 Straumann spun off
Spin out
A spin-out, also known as a spin-off or a starburst, refers to a type of corporate action where a company "splits off" sections of itself as a separate business....
its implant business into a separate privately owned company, Stratec Medical. Stratec partially listed its shares on the SWX Swiss Exchange
SWX Swiss Exchange
SIX Swiss Exchange , based in Zurich, is Switzerland's principal stock exchange . SIX Swiss Exchange also trades other securities such as Swiss government bonds and derivatives such as stock options.The main stock market index for the SIX Swiss Exchange is the SMI, the Swiss Market Index...
through an initial public offering
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...
six years later, while Synthes USA and Mathys remained in private hands. Three years later, however, Stratec and Synthes USA merged
Mergers and acquisitions
Mergers and acquisitions refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or...
to form a new publicly-traded company
Public company
This is not the same as a Government-owned corporation.A public company or publicly traded company is a limited liability company that offers its securities for sale to the general public, typically through a stock exchange, or through market makers operating in over the counter markets...
named Synthes-Stratec. After the merger Hansjörg Wyss became, and remains today, the majority shareholder
Shareholder
A shareholder or stockholder is an individual or institution that legally owns one or more shares of stock in a public or private corporation. Shareholders own the stock, but not the corporation itself ....
of the enlarged company. The third of the original AO/ASIF partner companies, Mathys, sold its osteosynthesis department to Synthes-Stratec in 2004, although the firm's German
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
division was divested
Divestment
In finance and economics, divestment or divestiture is the reduction of some kind of asset for either financial or ethical objectives or sale of an existing business by a firm...
to satisfy competition authorities. The company subsequently dropped the "-Stratec" suffix
Suffix
In linguistics, a suffix is an affix which is placed after the stem of a word. Common examples are case endings, which indicate the grammatical case of nouns or adjectives, and verb endings, which form the conjugation of verbs...
to become simply Synthes. The company's shares were added to the benchmark Swiss Market Index
Swiss Market Index
The Swiss Market Index is Switzerland's blue-chip stock market index, which makes it the most important in the country. It is made up of twenty of the largest and most liquid SPI large- and mid-cap stocks...
for the first time in September 2004.
In 2006 the company acquired the rights to the Synthes brand name and most of the related intellectual property
Intellectual property
Intellectual property is a term referring to a number of distinct types of creations of the mind for which a set of exclusive rights are recognized—and the corresponding fields of law...
, including patent
Patent
A patent is a form of intellectual property. It consists of a set of exclusive rights granted by a sovereign state to an inventor or their assignee for a limited period of time in exchange for the public disclosure of an invention....
s, from the AO/ASIF foundation for around CHF
Swiss franc
The franc is the currency and legal tender of Switzerland and Liechtenstein; it is also legal tender in the Italian exclave Campione d'Italia. Although not formally legal tender in the German exclave Büsingen , it is in wide daily use there...
1 billion. AO also acquired a stake in Synthes. The two organisations continue to collaborate on relevant issues.
In October 2010, Synthes and its subsidiary Norian both pled guilty to crimes relating to illegally implanting bone cement without FDA approval. Norian will admit to a felony charge of conspiracy to impede FDA functions and pay a $23 million dollar fine. Synthes will then divest Norian.
In November 2010, Synthes acquired USA based privately owned surgical tools maker The Anspach Effort, Inc, purchase price was not disclosed.
On April 27, 2011 Synthes and Johnson and Johnson agreed to a merger deal. The merger will create the world's largest orthopedic corporation.
Products
The company's product offering spans six divisions, of which four produce implantsImplant (medicine)
An implant is a medical device manufactured to replace a missing biological structure, support a damaged biological structure, or enhance an existing biological structure. Medical implants are man-made devices, in contrast to a transplant, which is a transplanted biomedical tissue...
and related instruments for the treatment of physical trauma
Physical trauma
Trauma refers to "a body wound or shock produced by sudden physical injury, as from violence or accident." It can also be described as "a physical wound or injury, such as a fracture or blow." Major trauma can result in secondary complications such as circulatory shock, respiratory failure and death...
, spinal injuries
Spinal cord injury
A spinal cord injury refers to any injury to the spinal cord that is caused by trauma instead of disease. Depending on where the spinal cord and nerve roots are damaged, the symptoms can vary widely, from pain to paralysis to incontinence...
and CMF (craniomaxillofacial
Oral and maxillofacial surgery
Oral and maxillofacial surgery is surgery to correct a wide spectrum of diseases, injuries and defects in the head, neck, face, jaws and the hard and soft tissues of the oral and maxillofacial region. It is an internationally recognized surgical specialty...
) trauma, as well as for osteotomy
Osteotomy
An osteotomy is a surgical operation whereby a bone is cut to shorten, lengthen, or change its alignment. It is sometimes performed to correct a hallux valgus, or to straighten a bone that has healed crookedly following a fracture. It is also used to correct a coxa vara, genu valgum, and genu varum...
in animals such as horse
Horse
The horse is one of two extant subspecies of Equus ferus, or the wild horse. It is a single-hooved mammal belonging to the taxonomic family Equidae. The horse has evolved over the past 45 to 55 million years from a small multi-toed creature into the large, single-toed animal of today...
s and dog
Dog
The domestic dog is a domesticated form of the gray wolf, a member of the Canidae family of the order Carnivora. The term is used for both feral and pet varieties. The dog may have been the first animal to be domesticated, and has been the most widely kept working, hunting, and companion animal in...
s. Synthes' other business segments are the production of surgical
Surgery
Surgery is an ancient medical specialty that uses operative manual and instrumental techniques on a patient to investigate and/or treat a pathological condition such as disease or injury, or to help improve bodily function or appearance.An act of performing surgery may be called a surgical...
power tool
Power tool
A power tool is a tool that is actuated by an additional power source and mechanism other than the solely manual labour used with hand tools. The most common types of power tools use electric motors. Internal combustion engines and compressed air are also commonly used...
s and biomaterial
Biomaterial
A biomaterial is any matter, surface, or construct that interacts with biological systems. The development of biomaterials, as a science, is about fifty years old. The study of biomaterials is called biomaterials science. It has experienced steady and strong growth over its history, with many...
s used to fill bone defects.
Controversy
In 2009 Synthes announced a settlement with the state of New Jersey, over concerns that clinical investigators did not disclose their financial interests. In November 2009 Synthes pleaded guilty to allegations of shipping “adulterated and misbranded” products as part of unlawful clinical trials.The indictment charges Synthes Inc. with a total of 52 felony counts: conspiracy to impair and impede the lawful functions of the FDA and to commit crimes against the US; 7 counts of making false statements in connection with an FDA inspection; and 44 counts of shipping adulterated and misbranded Norian XR in interstate commerce with intent to defraud.
The parent company, Synthes, is charged with 44 misdemeanor counts of shipping adulterated and misbranded Norian XR in interstate commerce, and the four executives, Michael D. Huggins, Thomas B. Higgins, Richard E. Bohner and John J. Walsh, are each charged with one misdemeanor count of shipping adulterated and misbranded Norian XR in interstate commerce. Synthes Inc. acquired N Spine Inc. in 2007.
According to a copy of the indictment, obtained by MM&M, from May 2002 until fall 2004 Norian conspired with others, including Synthes and the four named executives, to conduct unauthorized clinical trials of Synthes's medical devices, Norian XR and Norian SRS, in surgeries to treat vertebral compression fractures of the spine (VCFs), a painful condition commonly suffered by elderly individuals.
These surgeries were allegedly performed despite a warning on the FDA-cleared label for Norian XR against this use, and in the face of serious medical concerns about the safety of the devices when used in the spine.
According to the indictment, before the marketing program began, pilot studies showed the company that the bone cement reacted chemically with human blood in a test tube to cause blood clots. The research also showed, in a pig, that such Norian-caused clots became lodged in the lungs. Notwithstanding this knowledge, the company allegedly proceeded to market the product for VCFs without putting it through FDA-required testing. The company, it is alleged, did not stop marketing the product until after a third patient had died on the operating table.