As of this writing, three patients remain alive and supported on the AbioCor totally implanted heart, made by Abiomed (Danvers, Massachusetts), as part of the company's FDA-approved five-patient clinical trial of the device. Shortly before this issue of The BBI Newsletter went to press, the trial recorded its second death on Dec. 13 — an unidentified man who was the fourth person to be implanted in the trial, that procedure taking place at UCLA Medical Center (Los Angeles, California). Though not identified by name, the patient was described as a 74-year-old male, and the UCLA implant team of Dr. Hillel Laks, Dr. Daniel Marelli and Dr. Jaime Moriguchi said that he succumbed not because of any problem with the AbioCor heart but because of "multiple organ failure."

Implanted with the AbioCor on Oct. 17, this fourth implanted patient lived 56 days on the device, and his death came just days after the death of Robert Tools, the first person in the trial, implanted at Jewish Hospital (Louisville, Kentucky) on July 2 and supported by the heart for 150 days. The 56 days of life for the unnamed patient came close to the clinical trial endpoint of two months that Abiomed unofficially has said indicates success of the AbioCor, and the 150 days of life on the heart for Tools was considered a clear positive by analysts covering this sector.

Greg Simpson, analyst for A.G. Edwards (St. Louis, Missouri), emphasized the human side of the Abiomed trial offered by Tools, who had become somewhat of a media personality, oft-interviewed on TV. Tools, Simpson told BBI, "put a face and a personality" to the clinical trial, a fact that made his death difficult to accept as a positive. But Simpson added that "in strict clinical terms," those additional months of life for Tools added up to "clearly, absolutely, a great success." Echoing that assessment, Kurt Kruger of Banc of America Securities (San Francisco, California) put Tools' death "more in the 'expected event' category," noting that the AbioCor had worked well.

Besides the two deaths in the first clinical trial, the first patient in a second five-patient trial died during AbioCor implantation Nov. 28 at St. Luke's Episcopal Hospital (Houston, Texas), with the surgical team from the Texas Heart Institute (also Houston), saying that the patient most likely succumbed from the effects of anticoagulation medication. In all three cases, the deaths were attributed to the debilitated condition of the patients going into the trials, rather than any malfunction on the part of the AbioCor. The very poor condition of those patients offers a case of the proverbial double-edged sword: While it undoubtedly will serve to reduce the amount of additional time each patient may have on the AbioCor device, it is a basic requirement for receiving the heart. Thus, in reacting to the mid-December death at UCLA, Dr. David Lederman, chief executive officer of Abiomed, issued a statement underlining a key criteria for patient inclusion: "That patients have biventricular heart failure with no viable treatment alternative and a high probability of death within 30 days." Lederman added, "All of us have known from the start that our initial clinical trial patients would of necessity be near death and extraordinarily fragile, and that we would face a broad range of clinical challenges." But each patient in the trial, he said, "provides us with new information that will potentially contribute to the saving of thousands of lives in the not-too-distant future." He expressed continued confidence in the AbioCor, saying that it "will prove to be a replacement heart that can provide both significant life extension and good quality of life for heart failure patients who would otherwise have no hope."

While restating the company's position of issuing limited information about the trial, Abiomed reported that the other three patients in the trial "remain alive and [are] recovering well with no meaningful clinical problems." At the time of that statement, they had been supported on the heart for 91, 77, and 37 days, respectively.

Wells named as implant mediator

John Calhoun Wells, who has settled some of the most bitter U.S. labor disputes, has been brought in as a mediator to try to settle the barrage of litigation that threatens to engulf Sulzer Medica (Winterthur, Switzerland), following recalls in the U.S. of hip and knee implants made by the company's Sulzer Orthopedics unit (Austin, Texas). Wells will attempt to negotiate a settlement for patients affected by the voluntary recall of the implants. He will retain a financial auditor to undertake a review of Sulzer Medica's financial status and suggest ways the company can finance any settlement.

Wells, who headed the Federal Mediation and Conciliation Service until 1998, masterminded settlement of a number of large and complex American labor disputes, including Boeing (1995), the trucking industry (1995), United Parcel Service (1997) and Caterpillar (1998). Since returning to the private sector, he has been heavily involved in arbitrating the size of the legal fees the U.S. tobacco industry must pay to lawyers who won a $246 billion settlement in 1998. He is well known both to Richard Scruggs, Sulzer Medica's legal advisor, and many of the plaintiffs' lawyers who have launched more than 1,800 lawsuits against the company.

The decision to bring in a mediator reflects the failure of the two sides to agree on a proposed $783 million settlement under which Sulzer Medica would compensate the patients by issuing them shares equal to one-third of the equity in the company and give them up to half the company's profits for an unspecified period. While that proposal is being welcomed by many of the plaintiffs' lawyers, who stand to gain up to a quarter of the total, it is being opposed by Sulzer Medica shareholders worried about dilution. The company, currently valued at $428 million, insists that it will not increase its $783 million offer, which it said aims to treat all patients fairly while ensuring that the company can stay in business.

Gen-Probe to spin off as public company

Roche Holding AG (Basel, Switzerland) said last month that it will pay about $1.6 billion to purchase a majority stake in Japan's Chugai Pharmaceutical (Tokyo). For the pharmaceutical sector, that deal ishugeg, serving to return Roche to a Top 10 ranking in the pharmaceuticals arena, plus entry to the world's second-largest drug market. But the deal also offers a secondary plot line, one of interest for the diagnostics and medical device sectors. To sidestep antitrust problems, prior to the merger Chugai will spin off its Gen-Probe (San Diego, California) subsidiary, which competes with Roche in diagnostics.

Chugai shareholders will directly own shares in Gen-Probe, which will then be listed on the American Stock Exchange and be managed by its current executive team, headed by Henry Nordhoff as president and chief executive officer.

Gen-Probe and Roche "have very similar business on the blood screening side," and their diagnostics businesses "go head-to-head on a number of products around the world," Nordhoff told BBI. The proposed spin-off, he said, "is very positive, very good for us and offers opportunities for expansion."

Currently, the "large bulk" of Gen-Probe's sales are in diagnostics, primarily reagents, Nordhoff said. Gen-Probe was the first company to introduce nucleic acid probe tests for clinical use and has developed the TIGRIS automated instrument for molecular testing, with focus on sexually transmitted diseases.

With the approval of new blood testing products now under development under the FDA's new drug indication guidelines, the company eventually will have half of its sales in blood screening products, Nordhoff predicted. The spin-off will require approval by Chugai shareholders, he noted, with that vote coming probably by next summer and the spin-off completed probably in August or soon after.