Guidant (NYSE:GDT)
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Guidant Corporation (NYSE:GDT) has received the Report
on findings and recommendations from the Independent Panel that the
company convened in August 2005 to address various issues arising out
of the actions taken by Guidant's Cardiac Rhythm Management (CRM)
business in mid 2005. The Panel was asked to study and analyze the CRM
policies and actions regarding postmarket device evaluation of cardiac
device-related performance and communications of reliability and
patient safety information to physicians and patients. Based on its
observations, the Panel recommends guidelines for enhanced evaluation
of postmarket devices and communication of information to physicians
and patients about these life-sustaining implantable devices. Dr.
Robert J. Myerburg, Professor of Medicine and Physiology at the
University of Miami, chaired the Panel that included 11 other
distinguished experts covering a broad range of disciplines. Dr.
Myerburg personally presented the report yesterday to the Chief
Executive Officer and Board of Directors of Guidant Corporation.
The Panel's report in its entirety and background information
regarding the Panel can be viewed at http://www.guidant.com/panel/.
James M. Cornelius, Chairman of the Board and Chief Executive
Officer of Guidant Corporation, stated, "I want to express our deep
appreciation to the Independent Panel for its careful analysis, as
well as for the incisive and thorough recommendations contained in the
Panel's report. The Panel has presented Guidant with a blueprint for
improvement and enhancement of our postmarket evaluation of product
reliability and communications procedures regarding the performance
and safety of our devices. We intend to implement the recommendations
to further benefit patients and physicians. We are already working
closely with Boston Scientific to ensure a smooth transition of these
recommendations following the completion of the pending merger between
Guidant and Boston Scientific."
Dr. Myerburg commented, "I, and the other Panelists, were pleased
that Guidant Corporation executives assiduously honored their
commitment to unencumbered access to information, in the form of
documents, interviews, and site visits, resulting in our ability to
clearly understand the problems that led to the current stresses. We
found overall device reliability to be well within acceptable
performance expected of devices of that type, but internal and
external communications methods burdened the company's ability to
manage and communicate low frequency malfunctions. As a result, we are
gratified that the Panel's work has been able to lead to a series of
recommendations that we believe will improve the company's ability to
manage warning signals regarding potential malfunctions - a
fact-of-life for any manufactured product - and improve transparency
and the communication process between Guidant, physicians and
patients. I want to express my appreciation to each Panel member who
participated in this complex project for dedicating their time and
expertise to this important effort. The Panel noted that the company
now has an opportunity to transform a painful experience into a
benefit for itself and others in its industry who must confront
similar problems. By taking the appropriate actions, Guidant can
emerge as an industry leader in responding to the evolving societal
expectations for transparency and enhanced communications regarding
product performance and safety. Although many of the details of the
recommendations are specific to Guidant, the general principles
embodied in the statements will likely be applicable to the cardiac
rhythm management industry in general."
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The Panel made the following major recommendations to Guidant:
1. Establish an external committee of experts to serve as advisors
to Guidant regarding evaluation of product performance and health
risk assessment, potential actions to be taken in regard to device
failures and malfunctions, and guidance on when and how to
communicate with physicians and patients.
2. Designate or hire an in-house physician whose primary
responsibility is patient safety and who will participate in
product performance analysis, health hazard analysis, internal
communications and external communication policies and procedures.
3. Strengthen management links between the Corporation and its CRM
business unit, with specific attention to postmarket product
performance, patient safety issues and communication policies.
4. Enforce the general policy of the CRM business on the primacy of
patient safety by better integrating patient safety concerns into
the factual and statistical analysis of product performance and
performance failures.
5. Ensure that the CRM business, and the Company generally, implement
and enforce policies of transparency of information regarding
product performance and health hazard risk both to physicians and
the general public as new information is emerging.
6. Develop processes for confronting the challenge of achieving
more effective surveillance of marketed devices, in conjunction
with others in the industry, the Heart Rhythm Society, and the FDA.
7. In addition to the analysis of product performance and safety
event trends, develop processes to identify and act on even a
single event when it is associated with risk of death or serious
injury, has a suspected or defined basis for the malfunction or
failure, and is likely to be systematic and to occur in other
patients.
8. When a life-threatening defect has been identified and mitigated in
a specific product line, Guidant Corporation and its CRM business
should expedite review for immediate consideration of ceasing
shipments of unmitigated devices, and retrieving those in
possession of the sales force or in hospital inventories.
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"Guidant has already begun to implement changes that will address
some of these recommendations, including taking steps to provide
enhanced information through the expanded Product Performance Report
we now make available to physicians and patients on our website. This
Guidant initiative will be supplemented by additional communication
recommendations made by the Panel. And, as an immediate response to
one of the Panel's major recommendations, the company is actively
recruiting for the newly created position of Chief Medical and Patient
Safety Officer at CRM, a physician who will be responsible for
overseeing all issues relating to patient safety," Cornelius
continued.
Cornelius added, "Clearly, this has been a challenging time for
our patients, customers and our employees. Our commitment has always
been and always will be to saving and improving lives through
innovative medical technologies. We are pleased that the Panel
recognized in its report that 'the function and reliability of
products manufactured by the CRM business have made it a respected
leader in its industry.' We recognize that the environment has
changed, not just for Guidant but also for our industry as a whole and
we are taking the necessary steps to improve surveillance of device
performance and safety, as well as physician and patient
communications.
"I am enormously proud of Guidant's decades-long tradition of
innovation and commitment to quality. The people of Guidant are
conscientious professionals of the highest integrity, pride and
ability. Nothing is more important to them or to me than keeping and
maintaining the trust of the public and physicians. I am confident
that the talented men and women of Guidant will help us achieve that
goal," concluded Cornelius.
Guidant Corporation pioneers lifesaving technology, giving an
opportunity for better life today to millions of cardiac and vascular
patients worldwide. The company develops, manufactures and markets a
broad array of products and services that enable less-invasive care
for some of life's most threatening medical conditions. For more
information, visit www.guidant.com.
Boston Scientific and Guidant have filed a definitive
prospectus/joint proxy statement with the SEC in connection with the
proposed transaction. The material contained herein is not a
substitute for the definitive prospectus/joint proxy statement or any
other documents that Boston Scientific and Guidant have filed or will
file with the SEC. Investors and security holders are urged to read
the definitive prospectus/joint proxy statement and any other relevant
documents filed or to be filed by Boston Scientific or Guidant,
because they contain or will contain important information about the
proposed transaction. The definitive prospectus/joint proxy statement
is, and other documents filed or to be filed by Boston Scientific and
Guidant with the SEC are or will be, available free of charge at the
SEC's website (www.sec.gov) or from Boston Scientific by directing a
request to Boston Scientific Corporation, One Boston Scientific Place,
Natick, Massachusetts 01760-1537, Attention: Milan Kofol, Investor
Relations, or from Guidant by directing a request to Guidant
Corporation, 111 Monument Circle, 29th Floor, Indianapolis, Indiana
46204, Attention: Investor Relations.
Boston Scientific, Guidant and their respective directors,
executive officers and other employees may be deemed to be
participants in the solicitation of proxies from the security holders
of Boston Scientific or Guidant in connection with the proposed
transaction. Information about Boston Scientific's directors and
executive officers is available in Boston Scientific's Annual Report
on Form 10-K for the year ended December 31, 2005, and information
about Guidant's directors and executive officers is available in
Guidant's Annual Report on Form 10-K for the year ended December 31,
2005. Additional information about the interests of potential
participants is included in the definitive prospectus/joint proxy
statement referred to above.
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Guidant Independent Panel
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Robert J. Myerburg, M.D., Professor of Medicine and
Chairman, Independent Panel Physiology
Division of Cardiology
American Heart Association
Chair in Cardiovascular
Research
University of Miami Miller
School of Medicine
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George E. Apostolakis, Ph.D. Professor of Nuclear Science
and Engineering, and
Professor of Engineering
Systems
Massachusetts Institute of
Technology
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George A. Beller, M.D., MACC, FAHA Professor of Cardiology
University of Virginia Health
System;
Past President of American
College of Cardiology
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John P. DiMarco, M.D., Ph.D., FACC, FAHA Professor of Medicine
University of Virginia Health
System
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David W. Feigal, M.D., MPH Research Professor Arizona
Biodesign Center at Arizona
State;
Past Director of Center for
Devices and Radiological
Health (CDRH),
United States Food and Drug
Administration
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Kenneth Goodman, Ph.D. Associate Professor of
Medicine and Philosophy, and
Director of the Bioethics
Program
University of Miami Ethics
Program
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Sharon A. Hunt, M.D., FACC Professor of Medicine
Stanford University School of
Medicine
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Bruce D. Lindsay, M.D., FACC Associate Professor of
Medicine, and
Director of Clinical
Electrophysiology Lab
Washington University
School of Medicine
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Edward W. Maibach, Ph.D., MPH Professor and Director of the
Public Health Communication
Program
School of Public Health and
Health Services
George Washington University
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Gerald V. Naccarelli, M.D., FACC, FAHA The Bernard Trabin Chair in
Cardiology
Professor of Medicine
Chief of Division of
Cardiology
Director of the
Cardiovascular Center
Penn State University College
of Medicine
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M. Jane Teta, Dr.PH, MPH Principal Scientist and
Practice Director of Health
Sciences at Exponent, Inc.
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Joel I. Verter, Ph.D. Senior Investigator
Statistics Collaborative,
Inc.
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Counsel to the Panel: Senior Partner
Peter O. Safir, Esq. Covington & Burling
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