Getting The Lead Out

Magellan executives lied about their blood-testing devices, putting thousands of lead-poisoning victims at risk

“When the rich rob the poor, it’s called business.” – Mark Twain

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Sometimes in business you’re faced with a difficult choice: Tell the truth and lose millions or lie and risk a federal prison sentence.

And just so you know: The lies in this particular situation will put thousands of mostly underprivileged children and low-income adults at risk. Can you live with that?

This is a tale of three executives who made the wrong choice. They ran Billerica, Mass.,-based Magellan Diagnostics, which manufactured devices that detected lead levels in fingerstick blood samples.

Its line of “LeadCare” devices performed more than half of all blood lead tests in the U.S. between 2013 and 2017. The only problem was that the results significantly undercounted the lead.

(Yeah, but don’t worry, mom. Your kid was probably learning-disabled anyway.)

[[Don’t Miss These Blunders]]

Here’s what Magellan’s blood tests apparently revealed: ‘Hey, we can make a lot of money off all these lead-poisoned children if we just keep quiet.” (Illustration: AI generated.)

Instead of immediately disclosing the glitches to their customers and the Food and Drug Administration, Magellan’s top executives struck a deal in 2016 to sell the company to Cincinnati-based Meridian Bioscience for $66 million.

Magellan’s CEO Amy Winslow, 53, bagged a $2 million bonus when the deal closed, according to the Justice Department. And chief executive Hossein Maleknia, 66, got a $448,000 bonus.

(Yay, team!)

Now it was Meridian’s problem. (Suckers!) After news of Magellan’s faulty devices broke, and the inevitable lawsuits mounted, Meridian’s stock went into free fall. (It’s now a privately held company.)

In May, Meridian agreed to pay $42 million to the Justice Department to settle criminal charges against the dodgy company that it had acquired and set up a victim’s compensation fund.

The FBI is still gathering information on victims. “What these three senior executives did was downright deceitful and dangerous,” said FBI agent Jodi Cohen in Boston.

On Tuesday, the three pleaded guilty to criminal charges:

• CEO Winslow of Needham Heights, Mass., pleaded guilty to one felony count of introduction of misbranded medical devices into interstate commerce. In exchange for her guilty plea, prosecutors have agreed to recommend a year and a day in prison and a $10,000 fine and to drop other fraud charges.

• COO Maleknia of Bonita Springs, Fla., pleaded guilty to two felony counts of introduction of misbranded medical devices into interstate commerce. Prosecutors agreed to recommend a year and a day in prison and a $20,000 fine and to dismiss other charges.

• Director of Quality Assurance and Regulatory Affairs Reba Daoust, 68, of Amesbury, Mass., pleaded guilty to one felony count of making false statements. Prosecutors have agreed to recommend six months in prison and to dismiss other charges.

“We trust that medical devices provide accurate results,” said U.S. Attorney Leah Foley. “These defendants eroded that trust by misleading regulators and customers about devices they knew could provide inaccurate results, and thereby knowingly endangered the health of children and other patients across the country.”