Magellan Diagnostics to Pay $42M for Concealing Lead Test Device Malfunction

BOSTON – In a shocking turn of events, Magellan Diagnostics, Inc., a medical device company headquartered in Billerica, Mass., has agreed to plead guilty and pay a staggering $42 million to resolve criminal charges related to its concealment of a device malfunction that produced inaccurately low lead test results for potentially tens of thousands of children and other patients.

According to the Department of Justice, Magellan will plead guilty to violations of the federal Food, Drug and Cosmetics Act and pay a $21.8 million fine, $10.9 million in forfeiture, and a minimum of $9.3 million to compensate patient victims. The company will also enter into a deferred prosecution agreement to resolve felony conspiracy fraud charges.

Magellan’s devices, including LeadCare Ultra, LeadCare II, and LeadCare Plus, detected lead levels and lead poisoning in the blood of children and adults using either venous or fingerstick samples. LeadCare II, which was predominantly used to test fingerstick samples, accounted for more than half of all blood lead tests conducted in the United States from 2013 through 2017.

But here’s the kicker: Magellan has admitted that it misled its customers and the FDA about a serious malfunction that affected its LeadCare devices when they were used to test venous blood samples. By hiding the malfunction and later deceiving customers and the FDA about when the company discovered the malfunction, the nature, extent, and frequency of the malfunction, and the risks associated with the malfunction, Magellan caused an estimated tens of thousands of children and other patients to receive inaccurately low lead test results.

The malfunction, which was first discovered in 2013, was concealed by Magellan for over a year, including before the product release. The company’s testing also indicated that the same malfunction affected the LeadCare II device, which was by far Magellan’s highest-revenue product. Magellan did not notify its customers and the FDA about the LeadCare II malfunction until November 2016.

The FDA ultimately found that the LeadCare Devices could not accurately test venous samples, leading to a recall of all LeadCare Devices using venous samples and a warning to the public not to use LeadCare Ultra, LeadCare II, and LeadCare Plus for venous blood samples because of the malfunction.

According to the Centers for Disease Control and Prevention, there is no safe level of lead in the blood. Lead exposure may cause irreversible lifelong physical and mental health problems. Young children and pregnant women are most vulnerable to lead exposure, especially those from low-income households and those who live in housing built before 1978 because those homes are more likely to contain lead-based paint and have fixtures containing lead.

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