Feds investigate Spectranetics customs practices, Nasdaq halts stock

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Makers of the excimer system to treat CV disease is under federal investigation. Image Source: Spectranetics  

The FDA and U.S. Immigration and Customs Enforcement (ICE) served medical device maker Spectranetics with a search warrant issued by the U.S. District Court of Colorado. When the announcement was made Sept. 4, Spectranetics' stock fell sharply, causing Nasdaq to temporarily halt trading of the company's stock.

The search warrant requested information and correspondence relating to: 

  • The promotion, use, testing, marketing and sales regarding certain of the company’s products for the treatment of in-stent restenosis, payments made to medical personnel and an identified institution for this application,
  • The promotion, use, testing, experimentation, delivery, marketing and sales of catheter guidewires and balloon catheters manufactured by certain third parties from outside of the U.S.;
  • Two post-market studies completed during the period from 2002 to 2005 and payments to medical personnel in connection with those studies; and
  • Compensation packages for certain of the company’s personnel.

Spokespersons from ICE, FDA and the U.S. Attorney's office in Denver all declined comment on the investigation. A joint statement said that no further information was available “since this is early into an ongoing investigation.”

The Associated Press reported that a Colorado Springs police spokesman Lt. David Whitlock said ICE agents told police that they were investigating whether parts from an international source had been improperly received.

In response to the federal investigation, Federman & Sherwood Wednesday launched an investigation of Spectranetics for possible misrepresentations or material omissions made by officers and directors with respect to the import and marketing of certain medical products manufactured outside the U.S.

The Colorado Springs, Colo.-based Spectranetics said it is fully cooperating with the appropriate authorities regarding the matter. The company said it currently expects that business operations will continue in the ordinary course.

However, the company confirmed that Nasdaq temporarily halted trading of its common stock.