Added Oct 18, 2011 – latest article on the COCHLEAR co. recall:
Latest recall of cochlear implants due to failure and listing of past known recalls and/or fines. NOTE: this post will be updated as more facts come in.
COCHLEAR, the co., announces it is recalling its “unimplanted” Nucleus CI500 range devices due to some failures. As a result Cochlear co. shares have dropped. Cochlear plunged 20 percent to A$57.77 as of 1:47 p.m. in Sydney, wiping A$820 million from the company’s market value. (google for the latest on the shares dive)
“The financial impact of the recall is “difficult to predict at this stage,” Cochlear said in the statement. The company, formed 29 years ago to develop a so-called bionic ear invented by Melbourne researcher Professor Graeme Clark, has about 70 percent of the global market for hearing devices implanted in the snail shell-like part of the inner ear.”
“This recall is potentially a big deal,” said Angus Gluskie, who manages more than $300 million at White Funds Management in Sydney. “The CI500 range is Cochlear’s primary implant device, and a recall may impact short-term earnings, as well as possibly damaging its reputation.”
NOTE: companies don’t voluntarily recall their products UNLESS they absolutely have to because a recall and end to a production line of this scale deals a huge blow to their stock, product marketability, productivity, profit, and reputation. Often the “voluntary” recalls are done to preserve the right to market their other brands, give the appearance of being proactive when in actuality it is in response to failures and concern that they will be fined and scrutinized more, and/or to get re-approval faster once the problem has been pinpointed and rectified.
To see more information – check the links at bottom.
ADDED 9/13 – article that has more details about how much COCHLEAR does not understand what is going on – why some of their cochlear implants are just shutting down. Last line of the article shows the great IRONY and dangers of believing propaganda. http://www.suntimes.com/business/7627305-420/bionic-ear-maker-cochlear-recalls-hearing-implants.html
Other unethical dealings, recalls, and faulty products by cochlear implant companies.
Cochlear Americas – (Colorado) – it is a branch of Cochlear ltd – was fined $880,000 by the US Department of Justice for insurance fraud (jacking up the cost of their cochlear implants for medicaid and medicare coverage) and kick backs (getting doctors, audiologists, hearing specialists, etc to recommend their brand of cochlear implants over other companies).
Advanced Bionics (California) has had several recalls and is awaiting approval from the Food and Drug Administration to resume sales in the U.S. after its latest recall due to a leakage that could lead to neural tissue damage. (ADDED: Note: on the same day that COCHLEAR announced its recall of their ci500 range cochlear implants, Advanced Bionics announced FDA had re-approved their Hi-Res 90K cochlear implant)
Previously, Advanced Bionics was fined the maximum fee of $1.1 million by the Food and Drug Administration for switching their supplier without notifying the FDA nor having the FDA approval. The cochlear implant was recalled “because of excessive moisture that could leak into the devices and cause device failure and possible surgery.” The CEO, Jeffery Greiner, was also fined $75,000.
Advanced Bionics also produced a cochlear implant with a positioner that had an increased number of people coming down with meningitis post surgery of which some people died from. Other Cochlear Implant manufacturers also have cases of meningitis post surgery.
Sonova, a Switz co. that brought Advanced Bionics, before the latest recall from its failing hot cochlear implant, filed a goodwill hardship due to losses from the world wide recall.
Otologics is a Colorado based cochlear implant company that was sued for trade secret theft and stealing talent away from a French cochlear implant company in its zest to try to produce the first 100% implantable cochlear implant. It was fined $5.9 Million dollars.
NOTE: With all these cochlear implant manufacturers in trouble – just as COCHLEAR cornered the market while Advanced Bionics was out of commission world wide and still is for the U.S. Market, perhaps Med-El (an Austrian based lower end cochlear implant producer) will pick up the market while Advanced Bionics, COCHLEAR and Otologics (which didn’t even have its 100% implantable CI completed yet) are out of commission for their new CIs in U.S. markets.
One thing is clear though – cochlear implants the devices and the industry is not the cash crop that many folks originally thought and the Bubble may have ka-boomed a bit.
Links about Cochlear the co. cochlear implants in the 500 range recall
The Australian Business with The Wall Street Journal
Wall Street Journal (you must sign up to subscribe)
Sydney Morning Herald
“The worst performing stock in the ASX 100 was Cochlear, which plunged 20.3 per cent, or by $14.68 to $57.50, after it announced it would recall of one of its hearing implant ranges. The implant manufacturer led the health care sector – the weakest on the market – to close 5.1 per cent lower.”