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Feds: Execs at Mass. company hid issue that produced inaccurate lead tests for thousands of kids

BOSTON — Three former executives at a company in Billerica are facing criminal charges after federal investigators say they concealed a medical device malfunction that allegedly produced inaccurate test results for tens of thousands of children.

Amy Winslow, 51, of Needham Heights, Reba Daoust, 66, of Amesbury, Maleknia, 64, of Bonita Springs, Florida, were all charged Wednesday with conspiracy to commit wire fraud, wire fraud, conspiracy to defraud an agency of the United States, and introduction of misbranded medical devices into interstate commerce with intent to defraud and mislead, according to United States Attorney Rachael S. Rollins.

Winslow and Daoust are slated to make an initial appearance in federal court in Boston Wednesday, while Maleknia is expected to make an initial appearance in federal court in Tampa.

Winslow, Maleknia, and Daoust, Magellan’s former CEO, COO, and Director of Quality Assurance and Regulatory Affairs, repeatedly misled customers and the FDA about a serious malfunction that affected Magellan’s LeadCare devices when they were used to test venous blood samples, prosecutors alleged in court documents.

By allegedly hiding the malfunction and later deceiving customers and the FDA about when they discovered the malfunction, the nature, extent and frequency of the malfunction, and the risks associated with the malfunction, the defendants caused an estimated tens of thousands of children and other patients to receive inaccurately low lead test results.

In a statement, Rollins said, “According to the CDC, there is no safe level of lead in the blood. Additionally, young children and pregnant mothers from low-income households living in public housing are the most vulnerable to lead exposure. We allege that these defendants deceived customers and the FDA about the reliability of medical tests that detected lead levels. By doing so, we assert that they endangered the health and lives of incredibly vulnerable victims...Here, we allege the personal gain is at the expense of poor people, children, and individuals who are pregnant. We pledge to advocate on these victims’ behalf and hold bad corporate actors accountable.”

The defendants first learned that a malfunction in their LeadCare Ultra device could cause inaccurate lead test results –specifically, lead test results that were falsely low – during the FDA clearance process in or around June 2013, according to prosecutors. Despite being aware of the malfunction, Magellan allegedly released LeadCare Ultra to the market in December 2013 without informing customers or the FDA.

Several months after the release, LeadCare Ultra customers independently discovered the malfunction and complained about inaccurate results. It’s further alleged that the defendants drafted and caused Magellan to provide false and misleading statements to customers that they “recently identified cases” of the malfunction and they did not observe the malfunction “in our clinical trials prior to the product release.”

According to court documents, the defendants were well aware of the malfunction for over a year, including before the product release.

Magellan’s testing in 2013 also indicated that the same malfunction affected the LeadCare II device, which was by far Magellan’s highest-revenue product, prosecutors said. Winslow and Maleknia, however, were positioning Magellan for sale, which could have been put in jeopardy if there was a malfunction affecting LeadCare II.

Winslow then allegedly told a Magellan employee to stop studying the malfunction in LeadCare II devices because Magellan needed to maintain “plausible deniability.” Only after Magellan was acquired by Meridian Bioscience, Inc. for $66 million in March 2016, did the defendants notify customers and the FDA about the LeadCare II malfunction, prosecutors said.

The defendants delayed notifying the FDA and then misled the FDA about the malfunction, and they only filed an FDA report for LeadCare Ultra after an outside consultant told Magellan that if they did not notify the FDA about the malfunction, the consultant would, according to prosecutors.

In 2017, the FDA says it contacted Magellan and asked when the company first discovered the malfunction. It’s alleged that, at Daoust and Maleknia’s instruction, Magellan’s representative falsely told the FDA that Magellan first discovered the problem after receiving customer complaints in late 2014 and shortly before Magellan notified the FDA in 2015 – even though Magellan actually discovered the malfunction almost four years earlier, in 2013. Winslow also allegedly caused Magellan to send a false timeline to the FDA, which omitted the company’s internal 2013 studies about the malfunction.

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.

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.

Anyone who believes they received an inaccurate blood lead test result from a LeadCare device between 2013-2017 is urged to complete a questionnaire located on the FBI’s website.

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