Cardinal Health, FDA settle Alaris issue

February 12, 2007

Cardinal Health has reached an agreement with the FDA on a consent decree regarding its Alaris SE line of infusion pumps. The agreement, which is subject to approval by the U.S. District Court for the Southern District of California, outlines the process Cardinal Health will follow to resume the manufacture and sale of its Alaris SE pumps in the U.S. market. Cardinal will submit a plan to the FDA outlining corrections for the Alaris SE pumps currently in use by customers, submitting a remediation plan for the seized Alaris SE pumps, and engaging an independent expert to inspect Alaris SE pump facilities and certify Cardinal Health's infusion pump operations. The corrective action and remediation plans must be approved by the FDA prior to implementation by Cardinal Health. On Aug. 15, 2006, Cardinal Health initiated a voluntary field corrective action of the product as the result of information indicating that a sensitive keypad posed a risk of "key bounce" that could lead to the overinfusing of patients. As part of the field corrective action, Cardinal Health sent letters and warning labels to its customers. On Aug. 28, 2006, Cardinal Health suspended production, sales, and repairs of its Alaris SE infusion pumps after approximately 1,300 units were seized by the FDA. These actions did not require the return of products currently in use by customers. Servicing of Alaris pumps was resumed on Sept. 15, 2006, with agreement from the FDA. There have been approximately 140,000 Alaris SE infusion pumps distributed worldwide during the past 12 years, and the product line currently represents less than 1% of the annual revenue for Cardinal Health's Clinical Technologies and Services segment.

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