SEC Probing Overseas Orthopedics Sales

Informal investigation looking to uncover whether Stryker, Zimmer, Smith & Nephew or Medtronic overseas sales violated the Foreign Corrupt Practices Act.

WASHINGTON (AP) — Several leading makers of knee, hip and other orthopedic implants revealed Friday that federal regulators are looking into possibly unlawful sales of their products in foreign countries.
Stryker Corp., Zimmer Holdings Inc., Smith & Nephew plc and Medtronic Inc. each said the Securities and Exchange Commission is conducting an informal inquiry into possible company violations of the Foreign Corrupt Practices Act, which outlaws bribing foreign officials to obtain or retain business. The SEC has brought civil charges under the act against a number of companies in recent years.
All firms said they would cooperate with the probe and do not believe they broke the law.
Stryker, which is based in Kalamazoo, Mich., and Zimmer both specialize in replacement implants for the knees, hips and other joints. Medtronic makes spinal implants to reduce pain and restore movement of the back and neck.
Last month Biomet Orthopedics Inc., Johnson and Johnson's Depuy Orthopedics, Smith & Nephew Inc. and Zimmer Holdings Inc. agreed to pay $310 to settle charges that they gave U.S. doctors kickbacks to boost product sales. Stryker was not charged in the case because it cooperated with Department of Justice investigators early in the investigation. All five companies will be monitored by the federal government through early 2009.
Zimmer spokesman Brad Bishop said the company does not believe the investigation into foreign sales practices is connected to the Department of Justice case.
A Stryker spokeswoman declined to comment on the nature of the probe.
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