Zimmer mulls $250M in doc-contract buyouts

Tracy Staton — Mon, 19 May 2008 11:15:48 -0400

You've heard of sports teams buying out their coaches' contracts. Well, now there's a device maker considering buying out its deals with surgeons. In a move designed to clear up legal troubles over its contracts with doctors, Zimmer is considering cutting off royalty contracts with many of them. To get out of those long-term deals, the company would give those docs up-front payments. Though Zimmer won't say how much that's likely to cost, analysts estimate the buyouts might run to $250 million.

And that would come on top of a $169.5 million fine levied by the U.S. government last year, plus the $54 million Zimmer expects to spend on new compliance measures, such as disclosing doc payments in an online database.

- read the story in the Financial Times

Related Article:
Zimmer weeds out doc conflicts

Guidant wants J&J to refund breakup fee

Tue, 02 Oct 2007 06:59:54 -0400

Broken engagements can be so acrimonious. When Guidant bowed out of its takeover by Johnson & Johnson to hook up with Boston Scientific, it paid J&J a $715 million breakup fee. Now Guidant wants that money back.

You'll recall that J&J sued for $5.5 billion in damages from that failed deal, claiming that Guidant breached its agreement not to entertain other suitors. Guidant has filed a counterclaim in that suit, saying it didn't breach their contract--and even if it had, it doesn't owe J&J the termination fee.

- read the report from the Star Tribune

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J&J may drop Guidant deal. Report
Guidant, Boston Scientific sign deal. Report
Guidant bid deadline approaches for J&J. Report

medical device news

Zimmer mulls $250M in doc-contract buyouts

Guidant wants J&J to refund breakup fee