Bad to the bone: A medical horror story

By Mina Kimes, writer


FORTUNE -- On Nov. 16, 2011, Georgia Baddley, a 70-year-old woman living near Salt Lake City, received a shocking call from a special agent at the U.S. Department of Health and Human Services. The agent told her that the government had come across new information about her mother's death.

Baddley was speechless. Eight years before, her 83-year-old mother, Barbara Marcelino, had unexpectedly died during spine surgery. At the time, Baddley didn't question what had happened; surgery was always risky for a woman of that age. She was horrified when the agent told her that the surgeon had injected bone cement into her mother's spine and that the product -- which was not approved for that use -- may have played a role in her death.

The agent explained that the government had filed criminal charges against the maker of the cement, a company called Synthes, and four of its executives. After hanging up the phone, Baddley sat in stunned silence. "I was taken aback," she says. "I had no idea that anything like that had happened."

Most people have never heard of Synthes, a medical device maker headquartered in West Chester, Pa. But the company became part of one of the most recognizable names in health care in June when Johnson & Johnson (JNJ) completed the purchase of it for nearly $20 billion -- the largest acquisition in J&J's history. Market watchers cheered the deal, which will expand the company's stable of high-margin orthopedic products. J&J, which has endured a series of reputation-sullying recalls and lawsuits in recent years, specifically cited Synthes's "culture" and "values" as evidence of its appeal, even as former Synthes executives awaited sentencing on charges of grievous conduct.

http://features.blogs.fortune.cnn.com/2012/09/18/synthes-norian-criminal/?iid=HP_LN