Baxter paying $18M to settle federal case over sterile plant failings

Justice statue with sword and scales
Baxter International has admitted selling adulterated sterile products and agreed to pay more than $18 million in penalties.

Ignoring issues in a sterile manufacturing plant can lead to big problems, like FDA warning letters, which Baxter International received for a plant in North Carolina after mold was found in HEPA filters. But in rare cases, it can lead to even more severe penalties, like the $18 million-plus Baxter will pay to resolve a federal criminal case, as well as a civil matter brought by a whistleblower over the mold concerns.  

The Justice Department Thursday announced the deal, saying the Deerfield, IL company admitted that it distributed “adulterated” products and will pay $16 million in penalties and forfeiture as part of a deferred prosecution agreement. It also agreed to regularly report about improvements made to its manufacturing operations.

Baxter will pay another $2.158 million to resolve a civil whistleblower case brought by Baxter employee Christopher Wall who had reported to the mold problem to plant management. Wall's case alleged his concerns were overlooked and the plant continued to manufacture and sell product from the facility. An FDA inspection in 2012 that led to a warning letter. Wall gets $431,535.99 as his share of the settlement.


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The DOJ said there was no evidence that the mold affected the IV solutions made at the facility during the 2011 and 2012 time period in question.

Baxter in a statement said, “We took a number of actions to address these issues, including terminating several members of the facility’s management team and enhancing the training and compliance processes for employees throughout the facility. We also undertook a number of actions to remediate the line and ensure continued compliance with quality standards, including physical changes to the line and implementing enhanced measures for inspections and environmental monitoring. And we’ve made a number of organizational and operational changes since 2012 that have served to elevate and enhance our quality systems, measurement and documentation, and operational oversight, in order to ensure we have the structure and processes in place to consistently deliver the high quality products our patients need and our customers expect.”

The company also said that its “extensive monitoring systems” had not uncovered an increases in complaints or patient adverse events for the products made on the lines during this time period.

That said, mold has shown up in Baxter products that made it to the market. In 2014, the company recalled one lot of a peritoneal product used on dialysis patients that was contaminated with mold. There were customer complaints about the product and the FDA reported there were reported adverse events. Baxter at the time said no causal relationship between the mold and the reported events had been established.

The DOJ said the case represents the kind of penalties companies can face for failing to meet FDA manufacturing standards.

“Despite notification by an employee of potential contamination concerns, Baxter was poorly focused on instituting sufficient safety standards for their products,” U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina said in a statement. “Today’s resolution reflects WDNC’s commitment to hold accountable drug companies that violate manufacturing standards and wrongly profit from those violations.”

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