President of DePuy Orthopedics Announces his Resignation

Johnson & Johnson recently announced that it had set aside about $1 billion to deal with potential settlements and litigation related to the recall.

Interestingly, just weeks after this announcement, the president of DePuy Orthopedics submitted his resignation . David Floyd, who has held the position since 2007, will be leaving the company at the end of March, 2011. DePuy has declined to release any specific reasons for the departure, only that he will “pursue other interests.”

Last year, DePuy Orthopedics generated $5.59 billion in sales. Of that, 9.1 percent total revenue went to Johnson & Johnson, according to data compiled by Bloomberg News. The costs and settlements are predicted to cut significantly into the companies’ profits. So far this year, Johnson & Johnson shares have declined 2.3 percent.

DePuy ASR Hip Failure Rates Multiply

In August of 2010, DePuy Orthopedics recalled  their ASR XL and ASR hip resurfacing systems. DePuy Orthopedics then warned of a failure rate between 12-13 percent within the first five years. According to a statement on the Johnson & Johnson website published at the time of the recall, the “majority of ASR hip replacement surgeries have been successful.”

Now, only six months after the recall, the failure rate expectancy is reported to be four times what was originally portrayed by Johnson & Johnson. U.K. doctors now estimate the failure rate to be as high as 49% after 6 years, and it is looking probable that the failed implants will eventually make up the majority.
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