Report: Olympus increased duodenoscope price amid UCLA multi-drug resistant outbreak

According to emails from the University of California at Los Angeles' (UCLA) Ronald Reagan Medical Center, Olympus refused a request by the hospital to lend it replacement endoscopic retrograde cholangiopancreatography (ERCP) duodenoscopes during a drug-resistant bacterial outbreak linked to the devices from 2014 to 2015, the Los Angeles Times reported Friday. The report said Olympus instead offered to sell UCLA 35 new scopes for $1.2 million, representing a 28-percent price increase from what it had charged the university months earlier.

Drug-resistant bacteria trapped inside the Olympus scopes have been tied to three patient deaths and five patients who were made ill at UCLA from October 2014 to January 2015, when the outbreak was confirmed. Olympus was later sued by a patient who accused the company of negligence for selling endoscopes prone to spreading bacteria. According to the Los Angeles Times, UCLA urgently needed replacement duodenoscopes at the time, adding that the eventual adoption of new cleaning measures left the medical centre with fewer available scopes.

However, the report cited emails in which Olympus sales manager Vincent Hernandez notified UCLA that its previous discounts no longer applied as "supplies are already low, where demand is high with all academic institutions expanding their inventories." Further, the report said the emails show Olympus continued to push sales of the devices linked to the outbreak, with the company recently posting a 13-percent increase in scope revenue for the nine months ending December 31.

Specifically, the Los Angeles Times cited an email from Randi Hissom, a business operations director at UCLA Health System, to Hernandez noting that "last February [2014], when we were acquiring the seven new TJF-Q180V scopes we have today, the price was $26 201 and our new quote is $33 470 [per] scope, which is an increase of 28 percent." Hernandez responded that the university could earn a discount if it ordered more duodenoscopes, warning that "with the number of scopes being requested, it is possible that we could go on a back order."

Meanwhile, shortly after the FDA had issued a safety communication about the ERCP duodenoscopes to all US hospitals in February 2015, Hernandez appeared to criticise two UCLA doctors in an email for failing to purchase the amount of equipment specified in their contract with Olympus, saying the company's salespeople "continued to run into a wall with acquiring orders" and that he "would like to arrange a meeting…to further review and discuss the compliance of the contract."

Commenting on the Los Angeles Times report, Olympus spokesman Mark Miller said the emails with UCLA "represent standard business discussions within Olympus and between company personnel and customers."

Last August, the FDA sent warning letters to Olympus, as well as to Pentax and Fujifilm, whose ERCP duodenoscopes have also been linked to drug-resistant bacterial infections at US hospitals, for failing to report problems with the devices and in some cases failing to ensure they could be adequately cleaned. In October, the FDA ordered Olympus America, Fujifilm Medical Systems and Hoya's Pentax Medical unit to conduct postmarket surveillance studies to better understand how the devices are reprocessed in real-world settings.

Earlier this year, the FDA cleared Olympus' TJF-Q180V duodenoscope with design and labelling modifications "intended to help reduce the risk of bacterial infections." The agency said at the time that "Olympus will voluntarily recall its original model currently being used in healthcare facilities and make the needed repair as quickly as possible." Meanwhile, a recent US Senate investigation blamed the FDA, device makers and hospitals for the outbreak of multi-drug resistant organisms following ERCP procedures, estimating that some 250 patients had fallen ill globally since 2012 and that the devices may have contributed to dozens of deaths.