A Medical Device Daily

Tenet Healthcare (Dallas) reported that it has reached an agreement providing for a nationwide settlement of certain class-action lawsuits regarding prices that uninsured and some under-insured patients were charged for prescription drugs and other medical products and services at hospitals owned and operated by Tenet subsidiaries.

The settlement is subject to certain conditions, including court approval. Tenet has established a reserve that it believes will be sufficient to cover the claims and expenses associated with the settlement.

"The settlement reflects Tenet's ongoing commitment to provide fair treatment to patients without health insurance," said E. Peter Urbanowicz, Tenet's general counsel. "This settlement is another important step in resolving the legacy legal issues facing our company. We have said that where reasonable resolutions of legal issues can be reached, we will work hard to make those resolutions happen."

The settlement is consistent with Tenet's Compact With Uninsured Patients, which it announced in January 2003. The Compact, which includes offering discounted pricing to the uninsured, was the first effort by a major hospital company to provide solutions to the challenges faced by patients without insurance.

Separately, Tenet issued a statement in response to an order entered last week in U.S. District Court in San Diego in the case titled United States of America v. Barry Weinbaum, Tenet HealthSystem Hospitals Inc. and Alvarado Hospital Medical Center (San Diego).

The court's order granted the defendants' motion for acquittal on two specific counts of violating Medicare anti-kickback laws but denied their motion for acquittal on conspiracy and 17 other specific counts.

The company commented: "While we are gratified that the court has discarded two counts of this indictment because they were unsubstantiated by evidence, we are disappointed that it chose not to discard all the others, which we strongly believe are also unsubstantiated by evidence. After a four-month trial and testimony by more than 40 witnesses, a jury could not reach a verdict in this case. We continue to believe that it would serve no purpose to retry this case. If there is another trial, however, we will be fully prepared to defend ourselves."

The court declared a mistrial in the case last month after a jury could not reach a verdict after more than a week of deliberations.

AMS Homecare (Vancouver, British Columbia) said it has filed a Statement of Claim in British Columbia Supreme Court alleging the TSX Venture Exchange and certain of its employees acted deliberately to delay the company's reverse takeover (RTO) of Shoprider Canada Mobility between August 2000 and February 2002.

The company says the improper actions of the exchange cost it "significant business opportunities for planned business growth and expansion." Although a total damage amount is not specified, the company alleges that the delay of 12 to 15 months and the increased expense associated with the exchange's actions cost AMS the loss of opportunities to expand its business in Canada and to implement a planned expansion into the U.S. that alone resulted in the loss of C$75 million to C$100 million in revenue over five years.

The company said that because of the problems described in the statement of claim it will only begin its U.S. expansion in the next few months and in a manner significantly modified from its original plans. AMS Homecare estimates that it will seek damages including any potential penalties in an amount, approaching C$100 million, although it has yet to be finalized.

The suit also names a former company lawyer who is alleged to have breached his duties of loyalty and confidence to the company in communications with the exchange after the company had fired him and, which unknown to the company, were used by the exchange in its efforts to delay the RTO.

AMS Homecare's damage claim includes claims for conspiracy, abuse of the Exchange's public authority, bad faith, interference with economic relations and breach of contract. The company also claims unspecified special damages, punitive damages, court-ordered interest and special costs.

MDS (Toronto) and Atomic Energy of Canada Ltd. (AECL) said that the two companies have reached an agreement to seek a mediated resolution of the issues related to the construction, commissioning and operation of the MAPLE facilities in Chalk River, Ontario. Those facilities, when commissioned, will exclusively produce medical isotopes used globally for the diagnosis and treatment of disease.

Ontario Appeals Court Judge Stephen Goudge has been appointed as the mediator and will work closely with the two parties. The government of Canada has agreed to have a representative be a formal observer in this process.

"We see the initiation of this mediation process as a positive step towards the resolution of the issues related to this project," said MDS President and CEO John Rogers.

Robert Van Adel, president and CEO of AECL added, "We are entering into this voluntary mediation process with the spirit and intent of arriving at a satisfactory resolution to all of the outstanding issues and we look forward to the successful commissioning of the MAPLE reactors."

About 15 million to 20 million nuclear medicine procedures are performed each year around the world. MDS, through its isotopes division, MDS Nordion (Ottawa, Ontario), supplies more than half of the global supply of reactor-produced medical isotopes.