Newsletter Signup
Stay up to date on all the latest news from Boston.com
Former top executives at Billerica company knowingly sold defective lead testing devices used by ‘tens of thousands of children,’ prosecutors say
Former officials at Magellan Diagnostics allegedly hid lead testing device malfunctions for years to boost profits.
Three former senior executives of Billerica-based medical device company Magellan Diagnostics, Inc. were arrested this week and accused of knowingly selling faulty lead testing devices for years. Their actions caused tens of thousands of children and other patients to receive inaccurate test results, U.S. Attorney Rachael Rollins’s office said Wednesday.
Amy Winslow, 51, of Needham; Reba Daoust, 66, of Amesbury; and Hossein Maleknia, 64, of Bonita Springs, Fla. face a series of fraud charges. They allegedly knew about the malfunctions and lied to preserve the sale of the company.
“According to the CDC, there is no safe level of lead in the blood. Additionally, young children and pregnant mothers from low-income households living in public housing are the most vulnerable to lead exposure. We allege that these defendants deceived customers and the FDA about the reliability of medical tests that detected lead levels. By doing so, we assert that they endangered the health and lives of incredibly vulnerable victims,” Rollins said in a statement.
Advertisement:
Lead can accumulate in the human body over time, and exposure is usually assessed by bloodwork. It is particularly harmful to young children, according to the World Health Organization.
The charges concern three devices produced by Magellan: LeadCare Ultra, LeadCare II, and LeadCare Plus. They are used to detect lead levels and lead poisoning in blood using either fingerstick samples or the withdrawal of blood from a patient’s arm. Specifically, the LeadCare II accounted for more than half of all blood lead tests conducted in the country from 2013 through 2017, officials said.
Winslow, Maleknia, and Daoust served as Magellan’s former CEO, COO, and Director of Quality Assurance and Regulatory Affairs, respectively. Prosecutors allege that they first learned about a malfunction in the LeadCare Ultra device during an FDA clearance process in or around June 2013. The malfunction could cause results that were inaccurately low.
Advertisement:
Winslow’s layer, BJ Trach, released the following statement to Boston.com regarding the allegations:
“We are extremely disappointed that the government chose to go forward with this misguided prosecution. Amy left Magellan amicably 5 years ago, and was a thoughtful, compassionate, and effective leader there through difficult times for the company. She did not commit any crimes, and this prosecution, inexplicably initiated so many years after the events at issue, should never have been brought. We look forward to Amy having her day in court, and we are confident she will be vindicated,” Trach said.
Despite this revelation, the LeadCare Ultra was released to the market in December 2013 and neither customers nor the FDA was told about the malfunction, prosecutors said. Customers independently discovered the malfunction several months later and complained about inaccurate results.
The defendants allegedly drafted false and misleading statements that were sent to customers about “recently identified cases” of the malfunction. They told customers that the malfunction was not observed in pre-release testing. Prosecutors say that the executives knew about the malfunction for more than a year at that point.
Testing done in 2013 also found that the same malfunction affected the LeadCare II, by far the highest-grossing product for Magellan, prosecutors said. Winslow and Maleknia were positioning Magellan for a sale at the time, and the malfunction could have put this in jeopardy. So Winslow allegedly told a Magellan employee to stop studying the LeadCare II malfunction because the company needed to maintain “plausible deniability.”
Advertisement:
Magellan was acquired by Meridian Bioscience, Inc. for $66 million in March 2016. After the acquisition, Winslow received a bonus of approximately $2 million and Maleknia received a bonus of approximately $448,000, officials said.
It was only after the sale was completed that the defendants notified customers and the FDA about the LeadCare II malfunction, according to Rollins’s office. The report to the FDA allegedly made false statements and concealed facts about the discovery of the malfunction.
“We believe these executives knew about this malfunction for years, but failed to come clean to their customers and the FDA about it in order to boost their company’s bottom line,” Joseph R. Bonavolonta, special agent in charge of the FBI’s Boston office, said in a statement. “The last thing sick children and their parents should have to worry about is whether diagnostic tests and devices live up to their manufacturer’s claims.”
The defendants only filed an FDA report for LeadCare Ultra after an outside consultant told Magellan that if the company did not notify the FDA, the consultant would. Magellan was contacted by the FDA in 2017 and asked about when the company first discovered the malfunction. A Magellan representative, at Daoust and Maleknia’s instruction, allegedly told the FDA that the company first discovered the problem after receiving customer complaints in late 2014, shortly before Magellan notified the FDA in 2015.
Advertisement:
Winslow also allegedly caused Magellan to send a false timeline to the FDA that omitted the company’s internal 2013 studies about the malfunction.
Ultimately, the FDA found that the LeadCare Devices could not accurately test venous samples, and a recall was issued for all LeadCare Devices using venous samples. The public was also warned not to use the LeadCare Ultra, LeadCare II, and LeadCare Plus for venous blood samples due to the malfunction.
Anyone who believes that they received an inaccurate blood lead test result from a LeadCare device between 2013 and 2017 should complete a questionnaire found on the FBI’s website.
“This office, along with our other law enforcement partners, will vigorously investigate and prosecute those who put corporate profits before patient health,” Rollins said in a statement. “Here, we allege the personal gain is at the expense of poor people, children, and individuals who are pregnant. We pledge to advocate on these victims’ behalf and hold bad corporate actors accountable.”
To comment, please create a screen name in your profile
To comment, please verify your email address
Conversation
This discussion has ended. Please join elsewhere on Boston.com